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Arrow Electronics Inc. has a market cap of $4.61 billion; its shares were traded at around $41.29 with a P/E ratio of 8.1 and P/S ratio of 0.2. Arrow Electronics Inc. had an annual average earning growth of 7.6% over the past 10 years.
Highlight of Business Operations:Selling, general and administrative expenses increased $335.6 million, or 21.6%, in 2011, compared with 2010, on a sales increase of 14.1%. Selling, general and administrative expenses, as a percentage of sales, was 8.8% and 8.3% for 2011 and 2010, respectively. The increase in selling, general and administrative expenses in excess of the sales increase was driven by certain recent acquisitions which have a higher operating cost structure relative to the company's other businesses and was offset by higher profit margins for those businesses. For the year ended December 31, 2011, the dollar increase in selling, general and administrative expenses attributable to acquisitions was approximately $285 million.
Selling, general and administrative expenses increased $251.4 million, or 19.3%, in 2010, compared with 2009, on a sales increase of 27.7%. The dollar increase in selling, general and administrative expenses was primarily due to higher selling, general and administrative expenses to support the increased sales, the reinstatement of certain employee-related costs that were temporarily suspended during the global economic downturn, and higher selling, general and administrative expenses as a result of acquisitions. These increases were offset, in part, by the impact of a stronger U.S. dollar on the translation of the company's international financial statements for 2010 compared with the year-earlier period. Selling, general and administrative expenses, as a percentage of sales, was 8.3% and 8.9%, for 2010 and 2009, respectively. This decrease was primarily due to the company's continuing efforts to streamline and simplify processes and the company's ability to better leverage its existing cost structure to manage the increased level of sales relative to the year-earlier period.
The company recorded operating income of $908.8 million, or 4.2% of sales, in 2011 compared with operating income of $750.8 million, or 4.0% of sales, in 2010. Included in operating income for 2011 and 2010 were the previously discussed restructuring, integration, and other charges of $37.8 million and $33.5 million, respectively. Also included in operating income for 2011 was the previously discussed charge of $5.9 million related to the settlement of a legal matter.
The company recorded operating income of $750.8 million, or 4.0% of sales, in 2010 compared with operating income of $272.8 million, or 1.9% of sales, in 2009. Included in operating income for 2010 and 2009 were the previously discussed restructuring, integration, and other charges of $33.5 million and $105.5 million, respectively.
Working capital, as a percentage of sales, was 14.9%, 12.6%, and 12.1% in 2011, 2010, and 2009, respectively.
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