SCSC ScanSource Inc

ScanSource, Inc. (NASDAQ:SCSC), the leading international distributor of AIDC (automatic identification and data capture), point of sale, communications, and electronic security products for the reseller market, today announced complete financial results for its fourth quarter and fiscal year ended June 30, 2010.

“The ScanSource teams delivered excellent results for the June quarter across all product lines,” said Mike Baur, CEO, ScanSource, Inc. “This quarter we sold to an increasing number of customers and were pleased to see a resurgence of big deals.”

Quarter ended June 30, 2010:     Fiscal Year ended June 30, 2010:  

Net sales     $582 million

Net sales     $2,115 million

Net income  $14.0 million

Net Income  $48.8 million

Diluted EPS $0.52 per share Diluted EPS $1.82 per share

For the quarter ended June 30, 2010, net sales increased 32% to $582 million compared to $441 million for the quarter ended June 30, 2009. Operating income also increased by 5% to $21 million from $20 million in the comparable prior year quarter. Net income increased 12.4% to $14 million for the quarter ended June 30, 2010 versus $12.5 million for the quarter ended June 30, 2009. The effective tax rate for the quarter was 33.1%, compared to 37.4% for the fourth quarter of the prior year. Diluted earnings per share increased 10.6% to $0.52 in the current quarter compared to $.47 in the fourth quarter of the prior year.

For the year ended June 30, 2010, net sales increased $267 million, or 14.4% to $2.1 billion, compared to the prior year ended June 30, 2009. Fiscal year operating income also increased 2.2% to $75.8 million from $74.1 million for the prior fiscal year. Net income increased 2.4% to $48.8 million compared to $47.7 million for the prior fiscal year. The effective tax rate for the year was 35.6% compared to 37.0% for the prior fiscal year. Diluted earnings per share increased 1.7% to $1.82 compared to $1.79 in the prior fiscal year.

Forecast for Next Quarter

The Company announced its revenue forecast for the first quarter of fiscal 2011. ScanSource expects net revenues for the September 2010 quarter could range from $555 million to $575 million.

Safe Harbor Statement

This press release contains comments that are “forward looking” statements that involve risks and uncertainties; these statements are subject to the safe harbor created by the Private Securities Litigation Reform Act of 1995. Any number of important factors could cause actual results to differ materially from anticipated results, including, but not limited to macroeconomic circumstances that could impact our business, such as currency fluctuations, continued adverse capital and credit market conditions and a prolonged economic downturn. For more information concerning factors that could cause actual results to differ from anticipated results, see the Company’s annual report on Form 10-K for the year ended June 30, 2009 filed with, and the Company’s annual report on Form 10-K for the year ended June 30, 2010 to be filed with, the Securities and Exchange Commission.

About ScanSource, Inc.

ScanSource, Inc. (NASDAQ:SCSC) is a leading international distributor of specialty technology products, consisting of seven sales units in North America, Latin America and Europe.

ScanSource POS and Barcoding in North America, Latin America and Europe delivers AIDC and POS solutions; Catalyst Telecom in the U.S. and ScanSource Communications in North America and Europe, provide voice, video and converged communications equipment; and ScanSource Security in North America offers physical security solutions. Founded in 1992, the company ranks #881 on the Fortune 1000. For more information, call the toll-free sales telephone number at 800.944.2432 or visit www.scansourceinc.com.

    ScanSource, Inc. and Subsidiaries Condensed Consolidated Balance Sheets (Unaudited) (in thousands)   June 30, June 30, 2010 2009* Assets Current assets: Cash and cash equivalents $ 34,605 $ 127,664 Accounts receivable, less allowance of 357,749 291,037 $21,907 at June 30, 2010 $16,883 at June 30, 2009 Inventories 346,610 216,829 Prepaid expenses and other assets 16,762 18,032 Deferred income taxes   12,066     8,735 Total current assets 767,792 662,297   Property and equipment, net 23,528 21,035 Goodwill 33,785 34,087 Other assets, including identifiable intangible assets   34,645     31,212 Total assets $ 859,750   $ 748,631   Liabilities and Shareholders' Equity Current liabilities: Current portion of long-term debt $ - $ - Short-term borrowings - - Accounts payable 287,864 228,408 Accrued expenses and other liabilities 35,027 30,443 Income taxes payable   7,948     3,799 Total current liabilities 330,839 262,650   Deferred income taxes - - Long-term debt 30,429 30,429 Borrowings under revolving credit facility - - Other long-term liabilities   11,631     10,106 Total liabilities   372,899     303,185   Shareholder's equity: Common stock 111,951 104,461 Retained earnings 386,634 337,822 Accumulated other comprehensive income   (11,734 )   3,163 Total shareholders' equity   486,851     445,446 Total liabilities and shareholders' equity $ 859,750   $ 748,631   * Derived from audited financial statements at June 30, 2009.   ScanSource, Inc. and Subsidiaries Condensed Consolidated Income Statements (Unaudited) (in thousands, except per share information)         Quarter ended Twelve months ended June 30, June 30, 2010 2009 2010 2009 *   Net sales $ 582,342 $ 441,236 $ 2,114,979 $ 1,847,969 Cost of goods sold   525,519     387,753     1,896,052     1,639,121   Gross profit   56,823     53,483     218,927     208,848     Operating expenses: Selling, general and administrative expenses   35,840     33,505     143,151     134,730   Operating income 20,983 19,978 75,776 74,118   Other expense (income): Interest expense 365 366 1,472 2,176 Interest income (228 ) (286 ) (1,387 ) (1,405 ) Other, net   (150 )   (78 )   (50 )   (2,307 ) Other expense (income)   (13 )   2     35     (1,536 ) Income before income taxes 20,996 19,976 75,741 75,654 Provision for income taxes   6,947     7,473     26,929     27,966   Net income $ 14,049   $ 12,503   $ 48,812   $ 47,688     Per share data: Net income per common share, basic $ 0.53   $ 0.47   $ 1.83   $ 1.80   Weighted-average shares outstanding, basic   26,669     26,542     26,605     26,445     Net income per common share, diluted $ 0.52   $ 0.47   $ 1.82   $ 1.79   Weighted-average shares outstanding, diluted   26,937     26,704     26,869     26,588     * Derived from audited financial statements at June 30, 2009.