Document and Entity Information
Document and Entity Information Document - shares | 6 Months Ended | |
Dec. 31, 2022 | Jan. 25, 2023 | |
Document and Entity Information [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Dec. 31, 2022 | |
Document Transition Report | false | |
Entity File Number | 1-4224 | |
Entity Registrant Name | AVNET, INC. | |
Entity Incorporation, State or Country Code | NY | |
Entity Tax Identification Number | 11-1890605 | |
Entity Address, Address Line One | 2211 South 47th Street | |
Entity Address, City or Town | Phoenix | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85034 | |
City Area Code | 480 | |
Local Phone Number | 643-2000 | |
Title of 12(b) Security | Common stock, par value $1.00 per share | |
Trading Symbol | AVT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 91,379,483 | |
Entity Central Index Key | 0000008858 | |
Current Fiscal Year End Date | --07-01 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2022 | Jul. 02, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 324,778 | $ 153,693 |
Receivables | 4,789,402 | 4,301,002 |
Inventories | 4,972,898 | 4,244,148 |
Prepaid and other current assets | 216,487 | 177,783 |
Total current assets | 10,303,565 | 8,876,626 |
Property, plant and equipment, net | 378,269 | 315,204 |
Goodwill | 755,030 | 758,833 |
Operating lease assets | 229,537 | 227,138 |
Other assets | 263,473 | 210,731 |
Total assets | 11,929,874 | 10,388,532 |
Current liabilities: | ||
Short-term debt | 209,401 | 174,422 |
Accounts payable | 3,106,667 | 3,431,683 |
Accrued expenses and other | 688,643 | 591,020 |
Short-term operating lease liabilities | 52,944 | 54,529 |
Total current liabilities | 4,057,655 | 4,251,654 |
Long-term debt | 2,979,823 | 1,437,400 |
Long-term operating lease liabilities | 198,986 | 199,418 |
Other liabilities | 263,747 | 307,300 |
Total liabilities | 7,500,211 | 6,195,772 |
Commitments and contingencies (Note 7) | ||
Shareholders' equity: | ||
Common stock $1.00 par; authorized 300,000,000 shares; issued 90,735,161 shares and 95,701,630 shares, respectively | 90,735 | 95,702 |
Additional paid-in capital | 1,679,399 | 1,656,907 |
Retained earnings | 3,088,989 | 2,921,399 |
Accumulated other comprehensive loss | (429,460) | (481,248) |
Total shareholders' equity | 4,429,663 | 4,192,760 |
Total liabilities and shareholders' equity | $ 11,929,874 | $ 10,388,532 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) (Parenthetical) - $ / shares | Dec. 31, 2022 | Jul. 02, 2022 |
Stockholders' equity: | ||
Common stock, par value (in dollars per share) | $ 1 | $ 1 |
Common stock, shares authorized | 300,000,000 | 300,000,000 |
Common stock, shares, issued | 90,735,161 | 95,701,630 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Income Statement [Abstract] | ||||
Sales | $ 6,717,521 | $ 5,865,217 | $ 13,467,654 | $ 11,449,912 |
Revenue, Product and Service [Extensible List] | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember |
Cost of sales | $ 5,933,421 | $ 5,152,182 | $ 11,915,381 | $ 10,077,185 |
Cost, Product and Service [Extensible List] | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember | us-gaap:TechnologyServiceMember |
Gross profit | $ 784,100 | $ 713,035 | $ 1,552,273 | $ 1,372,727 |
Selling, general and administrative expenses | 485,127 | 501,363 | 962,764 | 987,540 |
Restructuring, integration and other expenses | 5,272 | |||
Operating income | 298,973 | 211,672 | 589,509 | 379,915 |
Other income, net | 1,476 | 1,737 | 1,800 | 1,327 |
Interest and other financing expenses, net | (59,020) | (21,630) | (104,118) | (44,474) |
Gain on legal settlement (Note 7) | 61,705 | 61,705 | ||
Income before taxes | 303,134 | 191,779 | 548,896 | 336,768 |
Income tax expense | 59,248 | 40,958 | 120,749 | 74,629 |
Net income | $ 243,886 | $ 150,821 | $ 428,147 | $ 262,139 |
Earnings per share: | ||||
Basic | $ 2.67 | $ 1.52 | $ 4.62 | $ 2.64 |
Diluted | $ 2.63 | $ 1.50 | $ 4.55 | $ 2.60 |
Shares used to compute earnings per share: | ||||
Basic | 91,192 | 99,032 | 92,621 | 99,340 |
Diluted | 92,755 | 100,286 | 94,195 | 100,701 |
Cash dividends paid per common share | $ 0.29 | $ 0.24 | $ 0.58 | $ 0.48 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 243,886 | $ 150,821 | $ 428,147 | $ 262,139 |
Other comprehensive income (loss), net of tax: | ||||
Foreign currency translation and other | 243,252 | (48,982) | 41,589 | (78,018) |
Pension adjustments, net | 333 | 4,010 | 10,199 | 8,022 |
Total comprehensive income | $ 487,471 | $ 105,849 | $ 479,935 | $ 192,143 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands | Common Stock | Additional Paid-in Capital | Retained Earnings | AOCI Attributable to Parent [Member] | Total |
Stockholders' Equity Attributable to Parent, Beginning Balance at Jul. 03, 2021 | $ 99,601 | $ 1,622,160 | $ 2,516,170 | $ (153,747) | $ 4,084,184 |
Shares issued Beginning Balance at Jul. 03, 2021 | 99,601,000 | ||||
Net income | 111,318 | 111,318 | |||
Translation adjustments and other | (29,036) | (29,036) | |||
Pension liability adjustment, net | 4,012 | 4,012 | |||
Cash dividends | (23,893) | (23,893) | |||
Repurchases of common stock | $ (275) | (10,228) | (10,503) | ||
Repurchase of common stock (in shares) | (275,000) | ||||
Stock-based compensation | $ 10 | 9,507 | 9,517 | ||
Stock-based compensation (in shares) | 10,000 | ||||
Shares issued Ending Balance at Oct. 02, 2021 | 99,336,000 | ||||
Stockholders' Equity Attributable to Parent, Ending Balance at Oct. 02, 2021 | $ 99,336 | 1,631,667 | 2,593,367 | (178,771) | 4,145,599 |
Stockholders' Equity Attributable to Parent, Beginning Balance at Jul. 03, 2021 | $ 99,601 | 1,622,160 | 2,516,170 | (153,747) | 4,084,184 |
Shares issued Beginning Balance at Jul. 03, 2021 | 99,601,000 | ||||
Net income | 262,139 | ||||
Pension liability adjustment, net | 8,022 | ||||
Shares issued Ending Balance at Jan. 01, 2022 | 98,430,000 | ||||
Stockholders' Equity Attributable to Parent, Ending Balance at Jan. 01, 2022 | $ 98,430 | 1,642,521 | 2,686,018 | (223,743) | 4,203,226 |
Stockholders' Equity Attributable to Parent, Beginning Balance at Oct. 02, 2021 | $ 99,336 | 1,631,667 | 2,593,367 | (178,771) | 4,145,599 |
Shares issued Beginning Balance at Oct. 02, 2021 | 99,336,000 | ||||
Net income | 150,821 | 150,821 | |||
Translation adjustments and other | (48,982) | (48,982) | |||
Pension liability adjustment, net | 4,010 | 4,010 | |||
Cash dividends | (23,749) | (23,749) | |||
Repurchases of common stock | $ (921) | (34,421) | (35,342) | ||
Repurchase of common stock (in shares) | (921,000) | ||||
Stock-based compensation | $ 15 | 10,854 | 10,869 | ||
Stock-based compensation (in shares) | 15,000 | ||||
Shares issued Ending Balance at Jan. 01, 2022 | 98,430,000 | ||||
Stockholders' Equity Attributable to Parent, Ending Balance at Jan. 01, 2022 | $ 98,430 | 1,642,521 | 2,686,018 | (223,743) | 4,203,226 |
Stockholders' Equity Attributable to Parent, Beginning Balance at Jul. 02, 2022 | $ 95,702 | 1,656,907 | 2,921,399 | (481,248) | $ 4,192,760 |
Shares issued Beginning Balance at Jul. 02, 2022 | 95,702,000 | 95,701,630 | |||
Net income | 184,261 | $ 184,261 | |||
Translation adjustments and other | (201,663) | (201,663) | |||
Pension liability adjustment, net | 9,866 | 9,866 | |||
Cash dividends | (26,998) | (26,998) | |||
Repurchases of common stock | $ (3,445) | (144,457) | (147,902) | ||
Repurchase of common stock (in shares) | (3,445,000) | ||||
Stock-based compensation | $ 72 | 8,939 | 9,011 | ||
Stock-based compensation (in shares) | 72,000 | ||||
Shares issued Ending Balance at Oct. 01, 2022 | 92,329,000 | ||||
Stockholders' Equity Attributable to Parent, Ending Balance at Oct. 01, 2022 | $ 92,329 | 1,665,846 | 2,934,205 | (673,045) | 4,019,335 |
Stockholders' Equity Attributable to Parent, Beginning Balance at Jul. 02, 2022 | $ 95,702 | 1,656,907 | 2,921,399 | (481,248) | $ 4,192,760 |
Shares issued Beginning Balance at Jul. 02, 2022 | 95,702,000 | 95,701,630 | |||
Net income | $ 428,147 | ||||
Pension liability adjustment, net | $ 10,199 | ||||
Shares issued Ending Balance at Dec. 31, 2022 | 90,735,000 | 90,735,161 | |||
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 31, 2022 | $ 90,735 | 1,679,399 | 3,088,989 | (429,460) | $ 4,429,663 |
Stockholders' Equity Attributable to Parent, Beginning Balance at Oct. 01, 2022 | $ 92,329 | 1,665,846 | 2,934,205 | (673,045) | 4,019,335 |
Shares issued Beginning Balance at Oct. 01, 2022 | 92,329,000 | ||||
Net income | 243,886 | 243,886 | |||
Translation adjustments and other | 243,252 | 243,252 | |||
Pension liability adjustment, net | 333 | 333 | |||
Cash dividends | (26,307) | (26,307) | |||
Repurchases of common stock | $ (1,629) | (62,795) | (64,424) | ||
Repurchase of common stock (in shares) | (1,629,000) | ||||
Stock-based compensation | $ 35 | 13,553 | $ 13,588 | ||
Stock-based compensation (in shares) | 35,000 | ||||
Shares issued Ending Balance at Dec. 31, 2022 | 90,735,000 | 90,735,161 | |||
Stockholders' Equity Attributable to Parent, Ending Balance at Dec. 31, 2022 | $ 90,735 | $ 1,679,399 | $ 3,088,989 | $ (429,460) | $ 4,429,663 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Jan. 01, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 428,147 | $ 262,139 |
Non-cash and other reconciling items: | ||
Depreciation | 39,411 | 43,876 |
Amortization | 4,294 | 8,964 |
Amortization of Operating Lease Assets | 26,414 | 27,426 |
Deferred income taxes | (15,581) | (4,451) |
Stock-based compensation | 21,338 | 19,556 |
Other, net | 7,199 | 10,281 |
Changes in (net of effects from businesses acquired and divested): | ||
Receivables | (469,650) | (558,702) |
Inventories | (686,884) | (359,755) |
Accounts payable | (341,210) | 328,574 |
Accrued expenses and other, net | 20,021 | (41,117) |
Net cash flows used for operating activities | (966,501) | (263,209) |
Cash flows from financing activities: | ||
Borrowings under accounts receivable securitization, net | 352,200 | 190,400 |
Borrowings under senior unsecured credit facility, net | 1,132,245 | 109,669 |
Borrowings (repayments) under bank credit facilities and other debt, net | 47,712 | (1,550) |
Repurchases of common stock | (221,282) | (45,570) |
Dividends paid on common stock | (53,304) | (47,642) |
Other, net | (1,048) | (6,069) |
Net cash flows provided by financing activities | 1,256,523 | 199,238 |
Cash flows from investing activities: | ||
Purchases of property, plant and equipment | (111,436) | (22,116) |
Other, net | (16,279) | 68,270 |
Net cash flows (used) provided by investing activities | (127,715) | 46,154 |
Effect of Exchange Rate on Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations | 8,778 | (14,056) |
Cash and cash equivalents: | ||
increase (decrease) | 171,085 | (31,873) |
Cash and cash equivalents at beginning of year | 153,693 | 199,691 |
Cash and cash equivalents at end of year | $ 324,778 | $ 167,818 |
Basis of presentation and new a
Basis of presentation and new accounting pronouncements | 6 Months Ended |
Dec. 31, 2022 | |
Basis of presentation and new accounting pronouncements | |
Basis of presentation and new accounting pronouncements | 1. Basis of presentation and new accounting pronouncements In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments necessary to present fairly Avnet, Inc. and its consolidated subsidiaries’ (collectively, the “Company” or “Avnet”) financial position, results of operations, comprehensive income and cash flows. All such adjustments are of a normal recurring nature. Certain reclassifications have been made to fiscal 2022 balances to correspond to the fiscal 2023 consolidated financial statement presentation. Preparing financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Actual results may differ from these estimates and assumptions. Interim results of operations do not necessarily indicate the results to be expected for the full fiscal year. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 2, 2022. Recently adopted accounting pronouncements In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Recently issued accounting pronouncements In September 2022, the FASB issued ASU No. 2022-04, Liabilities (subtopic 405-50): Supplier Finance Programs |
Receivables
Receivables | 6 Months Ended |
Dec. 31, 2022 | |
Receivables | |
Receivables | 2. Receivables The Company’s receivables and allowance for credit losses were as follows: December 31, July 2, 2022 2022 (Thousands) Receivables $ 4,895,907 $ 4,414,904 Allowance for Credit Losses (106,505) (113,902) The Company had the following activity in the allowance for credit losses during the first six months of fiscal 2023 and fiscal 2022: December 31, January 1, 2022 2022 (Thousands) Balance at beginning of the period $ 113,902 $ 88,160 Credit Loss Provisions 4,803 8,391 Credit Loss Recoveries (456) (321) Receivables Write Offs (12,476) (4,930) Foreign Currency Effect and Other 732 (1,726) Balance at end of the period $ 106,505 $ 89,574 |
Goodwill and intangible assets
Goodwill and intangible assets | 6 Months Ended |
Dec. 31, 2022 | |
Goodwill and intangible assets | |
Goodwill and intangible assets | 3. Goodwill and intangible assets Goodwill The following table presents the change in goodwill by reportable segment for the six months ended December 31, 2022. Electronic Components Farnell Total (Thousands) Carrying value at July 2, 2022 (1) $ 291,526 $ 467,307 $ 758,833 Foreign currency translation 569 (4,372) (3,803) Carrying value at December 31, 2022 (1) $ 292,095 $ 462,935 $ 755,030 (1) Includes accumulated impairments of $1,482,677 from prior fiscal years. Intangible Assets The net book value of intangible assets were $8.2 million as of December 31, 2022, which is not material to the consolidated financial statements. Intangible asset amortization expense was $1.5 million and $3.8 million for the second quarters of fiscal 2023 and 2022, respectively, and $4.3 million and $9.0 million for the first six months of fiscal 2023 and 2022, respectively. |
Debt
Debt | 6 Months Ended |
Dec. 31, 2022 | |
Debt | |
Debt | 4. Debt Short-term debt consists of the following (carrying balances in thousands): December 31, July 2, December 31, July 2, 2022 2022 2022 2022 Interest Rate Carrying Balance Other short-term debt 4.85 % 2.09 % $ 209,401 $ 174,422 Short-term debt $ 209,401 $ 174,422 Other short-term debt consists primarily of various committed and uncommitted lines of credit and other forms of bank debt with financial institutions utilized primarily to support the ongoing working capital requirements of the Company, including its foreign operations. Long-term debt consists of the following (carrying balances in thousands): December 31, July 2, December 31, July 2, 2022 2022 2022 2022 Interest Rate Carrying Balance Revolving credit facilities: Accounts receivable securitization program (due December 2024) 5.21 % 2.55 % $ 650,000 $ 297,800 Credit Facility (due August 2027) 4.37 % — 1,189,742 — Public notes due: April 2026 4.63 % 4.63 % 550,000 550,000 May 2031 3.00 % 3.00 % 300,000 300,000 June 2032 5.50 % 5.50 % 300,000 300,000 Long-term debt before discount and debt issuance costs 2,989,742 1,447,800 Discount and debt issuance costs – unamortized (9,919) (10,400) Long-term debt $ 2,979,823 $ 1,437,400 In December 2022, the Company amended and extended for two years its trade accounts receivable securitization program (the “Securitization Program”) in the United States with a group of financial institutions. The Securitization Program allows the Company to transfer, on an ongoing revolving basis, an undivided interest in a designated pool of trade accounts receivable, to provide security or collateral for borrowings of up to a maximum of $650 million. The Securitization Program does not qualify for off balance sheet accounting treatment and any borrowings under the Securitization Program are recorded as debt in the consolidated balance sheets. Under the Securitization Program, the Company legally sells and isolates certain U.S. trade accounts receivable into a wholly owned and consolidated bankruptcy remote special purpose entity. Such receivables, which are recorded within “Receivables” in the consolidated balance sheets, totaled $1.28 billion and $1.12 billion at December 31, 2022, and July 2, 2022, respectively. The Securitization Program contains certain covenants relating to the quality of the receivables sold. In August 2022, the Company amended and extended its five-year $1.25 billion revolving credit facility (the “Credit Facility”) with a syndicate of banks, which expires in August 2027. It consists of revolving credit facilities and the issuance of up to $200.0 million of letters of credit and up to $300.0 million of loans in certain approved currencies. As of December 31, 2022, and July 2, 2022, there were $ As of December 31, 2022, the carrying value and fair value of the Company’s total debt was $3.19 billion and $3.08 billion, respectively. At July 2, 2022, the carrying value and fair value of the Company’s total debt was $1.61 billion and $1.55 billion, respectively. Fair value for the public notes was estimated based upon quoted market prices (Level 1) and, for other forms of debt, fair value approximates carrying value due to the market based variable nature of the interest rates on those debt facilities (Level 2). |
Leases
Leases | 6 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | 5. Leases Substantially all the Company’s leases are classified as operating leases and are predominately related to real property for distribution centers, office space, and integration facilities with a lease term of up to 15 years. The Company’s equipment leases are primarily for automobiles and equipment and are not material to the consolidated financial statements. The components of lease cost related to the Company’s operating leases were as follows (in thousands): Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 Operating lease cost $ 16,917 $ 17,129 $ 33,482 $ 34,975 Variable lease cost 5,715 6,733 12,028 12,851 Total lease cost $ 22,632 $ 23,862 $ 45,510 $ 47,826 Future minimum operating lease payments as of December 31, 2022, are as follows (in thousands): Fiscal Year Remainder of fiscal 2023 $ 32,757 2024 53,201 2025 42,838 2026 33,816 2027 22,376 Thereafter 114,900 Total future operating lease payments 299,888 Total imputed interest on operating lease liabilities (47,958) Total operating lease liabilities $ 251,930 Other information pertaining to operating leases consists of the following: Six Months Ended December 31, January 1, 2022 2022 Operating Lease Term and Discount Rate Weighted-average remaining lease term in years 8.4 8.9 Weighted-average discount rate 3.8 % 3.8 % Supplemental cash flow information related to the Company’s operating leases was as follows (in thousands): Six Months Ended December 31, January 1, 2022 2022 Supplemental Cash Flow Information: Cash paid for operating lease liabilities $ 28,463 $ 29,456 Operating lease assets obtained from new operating lease liabilities 29,640 13,478 |
Derivative financial instrument
Derivative financial instruments | 6 Months Ended |
Dec. 31, 2022 | |
Derivative financial instruments | |
Derivative financial instruments | 6. Derivative financial instruments Many of the Company’s subsidiaries purchase and sell products in currencies other than their functional currencies, which subjects the Company to the risks associated with fluctuations in currency exchange rates. The Company uses economic hedges to reduce this risk utilizing natural hedging ( i.e. The Company generally does not hedge its investments in its foreign operations. The Company does not enter derivative financial instruments for trading or speculative purposes and monitors the financial stability and credit standing of its counterparties. The Company’s foreign currency exposure relates primarily to international transactions where the currency collected from customers can be different from the currency used to purchase from suppliers. The Company’s foreign operations transactions are denominated primarily in the following currencies: U.S. Dollar, Euro, British Pound, Japanese Yen, Chinese Yuan, Taiwan Dollar, Canadian Dollar and Mexican Peso. The Company also, to a lesser extent, has foreign operations transactions in other EMEA and Asian foreign currencies. The fair values of forward foreign currency exchange contracts not receiving hedge accounting treatment recorded in the Company’s consolidated balance sheets are as follows: December 31, July 2, 2022 2022 (Thousands) Prepaid and other current assets $ 59,693 $ 24,907 Accrued expenses and other 36,536 29,663 The amounts recorded to other (expense) income, net, related to derivative financial instruments for economic hedges are as follows: Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Net derivative financial instrument gain (loss) $ 11,543 $ (7,012) $ 11,184 $ (15,783) Under the Company’s economic hedging policies, gains and losses on the derivative financial instruments are classified within the same line item in the consolidated statements of operations as the remeasurement of the underlying assets or liabilities being economically hedged. |
Commitments and contingencies
Commitments and contingencies | 6 Months Ended |
Dec. 31, 2022 | |
Commitments and contingencies | |
Commitments and contingencies | 7. Commitments and contingencies From time to time, the Company may become a party to, or be otherwise involved in, various lawsuits, claims, investigations and other legal proceedings arising in the ordinary course of conducting its business. While litigation is subject to inherent uncertainties, management does not anticipate that any such matters will have a material adverse effect on the Company’s financial condition, liquidity, or results of operations. The Company is also currently subject to various pending and potential legal matters and investigations relating to compliance with governmental laws and regulations. For certain of these matters, it is not possible to determine the ultimate outcome, and the Company cannot reasonably estimate the maximum potential exposure or the range of possible loss, particularly regarding to matters in early stages. The Company currently believes that the resolution of such matters will not have a material adverse effect on the Company’s financial position or liquidity, but could possibly be material to its results of operations in any single reporting period. As of December 31, 2022, and July 2, 2022, the Company had aggregate estimated liabilities of $14.7 million classified within accrued expenses and other for such compliance-related matters that were reasonably estimable as of such dates. Gain on Legal Settlement During the second quarter of fiscal 2023, the Company recorded a gain on legal settlement of $61.7 million in connection with the settlement of claims filed against certain manufacturers of capacitors. As of December 31, 2022, the Company has received $51.2 million in cash related to these settlements, which were classified as operating cash flows in the Company’s Consolidated Statements of Cash Flows. |
Income taxes
Income taxes | 6 Months Ended |
Dec. 31, 2022 | |
Income taxes | |
Income taxes | 8 . Income taxes The Company’s effective tax rate on its income before taxes was 19.5% in the second quarter of fiscal 2023. During the second quarter of fiscal 2023, the Company’s effective tax rate was favorably impacted primarily by (i) decreases to unrecognized tax benefit reserves, partially offset by (ii) the mix of income in higher tax jurisdictions. During the second quarter of fiscal 2022, the Company’s effective tax rate on its income before taxes was 21.4%. During the second quarter of fiscal 2022, there were no individual items impacting the Company’s effective tax rate. For the first six months of fiscal 2023, the Company’s effective tax rate on its income before taxes was 22.0%. The effective tax rate for the first six months of fiscal 2023 was unfavorably impacted primarily by (i) the mix of income in higher tax jurisdictions, partially offset by (ii) decreases to unrecognized tax benefit reserves. During the first six months of fiscal 2022, the Company’s effective tax rate on its income before taxes was 22.2%. The effective tax rate for the first six months of fiscal 2022 was unfavorably impacted primarily by increases to valuation allowances. |
Pension and retirement plan
Pension and retirement plan | 6 Months Ended |
Dec. 31, 2022 | |
Pension and retirement plan | |
Pension and retirement plans | 9. Pension plan The Company has a noncontributory defined benefit pension plan that covers substantially all current or former U.S. employees (the “Plan”). Components of net periodic pension cost for the Plan was as follows: Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Service cost $ 3,004 $ 3,751 $ 6,008 $ 7,503 Total net periodic pension cost within selling, general and administrative expenses 3,004 3,751 6,008 7,503 Interest cost 6,683 3,947 13,365 7,894 Expected return on plan assets (12,215) (12,284) (24,430) (24,568) Amortization of prior service cost 1 1 2 2 Recognized net actuarial loss 618 4,086 1,235 8,172 Total net periodic pension benefit within other income, net (4,913) (4,250) (9,828) (8,500) Net periodic pension benefit $ (1,909) $ (499) $ (3,820) $ (997) The Company made $4.0 million of contributions during the first six months of fiscal 2023 and expects to make additional contributions to the Plan of $4.0 million in the remainder of fiscal 2023. |
Shareholders' equity
Shareholders' equity | 6 Months Ended |
Dec. 31, 2022 | |
Shareholders' equity | |
Shareholders' equity | 10. Shareholders’ equity Share repurchase program In May 2022, the Company’s Board of Directors approved a new share repurchase plan with an authorization to repurchase up to an aggregate of $600 million of common stock in the open market or through privately negotiated transactions. The timing and actual number of shares repurchased will depend on a variety of factors such as share price, expected liquidity, expected compliance with financial debt convents, corporate and regulatory requirements, and prevailing market conditions. During the second quarter of fiscal 2023, the Company repurchased 1.6 million shares under this program for a total cost of $64.4 million. As of December 31, 2022, the Company had $319.0 million remaining under its share repurchase authorization. Common stock dividend In November 2022, the Company’s Board of Directors approved a dividend of $0.29 per common share and dividend payments of $26.3 million were made in December 2022. |
Earnings per share
Earnings per share | 6 Months Ended |
Dec. 31, 2022 | |
Earnings per share | |
Earnings per share | 11. Earnings per share Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands, except per share data) Numerator: Net income $ 243,886 $ 150,821 $ 428,147 $ 262,139 Denominator: Weighted average common shares for basic earnings per share 91,192 99,032 92,621 99,340 Net effect of dilutive stock-based compensation awards 1,563 1,254 1,574 1,361 Weighted average common shares for diluted earnings per share 92,755 100,286 94,195 100,701 Basic earnings per share $ 2.67 $ 1.52 $ 4.62 $ 2.64 Diluted earnings per share $ 2.63 $ 1.50 $ 4.55 $ 2.60 Stock options excluded from earnings per share calculation due to an anti-dilutive effect 174 927 174 880 |
Additional cash flow informatio
Additional cash flow information | 6 Months Ended |
Dec. 31, 2022 | |
Additional cash flow information | |
Additional cash flow information | 12. Additional cash flow information Non-cash investing and financing activities and supplemental cash flow information were as follows: Six Months Ended December 31, January 1, 2022 2022 (Thousands) Non-cash Investing Activities: Capital expenditures incurred but not paid $ 11,086 $ 5,547 Non-cash Financing Activities: Unsettled share repurchases — $ 275 Supplemental Cash Flow Information: Interest $ 110,167 $ 49,192 Income tax net payments 110,401 74,889 Included in cash and cash equivalents as of December 31, 2022, and July 2, 2022, was $4.4 million and $5.4 million, respectively, of cash equivalents, which was primarily comprised of investment grade money market funds and overnight time deposits. |
Segment information
Segment information | 6 Months Ended |
Dec. 31, 2022 | |
Segment information | |
Segment information | 13. Segment information Electronic Components (“EC”) and Farnell (“Farnell”) are the Company’s reportable segments (“operating groups”). EC markets and sells (i) semiconductors, (ii) interconnect, passive and electromechanical devices, and (iii) integrated components, to a diverse customer base serving many end-markets. Farnell distributes electronic components and industrial products to a diverse customer base utilizing multi-channel sales and marketing resources. Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Sales: Electronic Components $ 6,309,494 $ 5,424,349 $ 12,633,717 $ 10,553,846 Farnell 408,027 440,868 833,937 896,066 6,717,521 5,865,217 13,467,654 11,449,912 Operating income: Electronic Components $ 296,709 $ 188,904 $ 563,962 $ 351,366 Farnell 36,905 60,189 88,516 109,781 333,614 249,093 652,478 461,147 Corporate (33,100) (33,625) (58,669) (66,925) Restructuring, integration and other expenses — — — (5,272) Amortization of acquired intangible assets and other (1,541) (3,796) (4,300) (9,035) Operating income $ 298,973 $ 211,672 $ 589,509 $ 379,915 Sales, by geographic area: Americas (1) $ 1,681,177 $ 1,391,567 $ 3,360,079 $ 2,650,377 EMEA (2) 2,255,878 1,840,789 4,385,418 3,588,368 Asia (3) 2,780,466 2,632,861 5,722,157 5,211,167 Sales $ 6,717,521 $ 5,865,217 $ 13,467,654 $ 11,449,912 (1) Includes sales from the United States of $1.57 billion and $1.29 billion for the second quarters ended December 31, 2022, and January 1, 2022, respectively. Includes sales from the United States of $3.13 billion and $2.45 billion for the first six months of fiscal 2023 and 2022, respectively. (2) Includes sales from Germany and Belgium of $956.5 million and $392.7 million, respectively, for the second quarter ended December 31, 2022; and $1.86 billion and $745.0 million, respectively, for the first six months of fiscal 2023. Includes sales from Germany and Belgium of $740.0 million and $330.7 million, respectively, for the second quarter ended January 1, 2022; and $1.44 billion and $638.3 million, respectively, for the first six months of fiscal 2022. (3) Includes sales from China (including Hong Kong), Taiwan and Singapore of $891.5 million, $1.19 billion and $360.9 million, respectively, for the second quarter ended December 31, 2022; and $1.85 billion, $2.46 billion and $754.9 million, respectively, for the first six months of fiscal 2023. Includes sales from China (including Hong Kong), Taiwan and Singapore of $863.0 million, $1.13 billion and $323.5 million, respectively, for the second quarter ended January 1, 2022; and $1.69 billion, $2.33 billion and $587.5 million, respectively, for the first six months of fiscal 2022. December 31, July 2, 2022 2022 (Thousands) Property, plant, and equipment, net, by geographic area: Americas (1) $ 105,691 $ 115,422 EMEA (2) 244,710 170,128 Asia 27,868 29,654 Property, plant, and equipment, net $ 378,269 $ 315,204 (1) Includes property, plant and equipment, net, of $103.0 million and $112.4 million as of December 31, 2022, and July 2, 2022, respectively, in the United States. (2) Includes property, plant and equipment, net, of $142.6 million, $80.6 million and $16.0 million in Germany, the United Kingdom and Belgium, respectively, as of December 31, 2022; and $67.6 million, $79.8 million and $16.7 million in Germany, the United Kingdom and Belgium, respectively, as of July 2, 2022. |
Restructuring expenses
Restructuring expenses | 6 Months Ended |
Dec. 31, 2022 | |
Restructuring expenses | |
Restructuring expenses | 14. Restructuring expenses During fiscal 2022 and prior, the Company incurred restructuring expenses related to various restructuring actions. The remaining restructuring liabilities established during fiscal 2022 and prior were not material as of December 31, 2022. |
Basis of presentation and new_2
Basis of presentation and new accounting pronouncements (Policies) | 6 Months Ended |
Dec. 31, 2022 | |
Basis of presentation and new accounting pronouncements | |
Basis of presentation | In the opinion of management, the accompanying unaudited interim consolidated financial statements contain all adjustments necessary to present fairly Avnet, Inc. and its consolidated subsidiaries’ (collectively, the “Company” or “Avnet”) financial position, results of operations, comprehensive income and cash flows. All such adjustments are of a normal recurring nature. Certain reclassifications have been made to fiscal 2022 balances to correspond to the fiscal 2023 consolidated financial statement presentation. Preparing financial statements in accordance with generally accepted accounting principles in the United States (“GAAP”) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements. Actual results may differ from these estimates and assumptions. Interim results of operations do not necessarily indicate the results to be expected for the full fiscal year. The information included in this Form 10-Q should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended July 2, 2022. |
New accounting pronouncements | Recently adopted accounting pronouncements In October 2021, the FASB issued ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers Recently issued accounting pronouncements In September 2022, the FASB issued ASU No. 2022-04, Liabilities (subtopic 405-50): Supplier Finance Programs |
Receivables (Tables)
Receivables (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Receivables | |
Schedule of receivables and allowance for credit losses | December 31, July 2, 2022 2022 (Thousands) Receivables $ 4,895,907 $ 4,414,904 Allowance for Credit Losses (106,505) (113,902) December 31, January 1, 2022 2022 (Thousands) Balance at beginning of the period $ 113,902 $ 88,160 Credit Loss Provisions 4,803 8,391 Credit Loss Recoveries (456) (321) Receivables Write Offs (12,476) (4,930) Foreign Currency Effect and Other 732 (1,726) Balance at end of the period $ 106,505 $ 89,574 |
Goodwill and intangible assets
Goodwill and intangible assets (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Goodwill and intangible assets | |
Change in goodwill balances by reportable segment | Electronic Components Farnell Total (Thousands) Carrying value at July 2, 2022 (1) $ 291,526 $ 467,307 $ 758,833 Foreign currency translation 569 (4,372) (3,803) Carrying value at December 31, 2022 (1) $ 292,095 $ 462,935 $ 755,030 (1) Includes accumulated impairments of $1,482,677 from prior fiscal years. |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Debt | |
Short-term debt | Short-term debt consists of the following (carrying balances in thousands): December 31, July 2, December 31, July 2, 2022 2022 2022 2022 Interest Rate Carrying Balance Other short-term debt 4.85 % 2.09 % $ 209,401 $ 174,422 Short-term debt $ 209,401 $ 174,422 |
Long-term debt | Long-term debt consists of the following (carrying balances in thousands): December 31, July 2, December 31, July 2, 2022 2022 2022 2022 Interest Rate Carrying Balance Revolving credit facilities: Accounts receivable securitization program (due December 2024) 5.21 % 2.55 % $ 650,000 $ 297,800 Credit Facility (due August 2027) 4.37 % — 1,189,742 — Public notes due: April 2026 4.63 % 4.63 % 550,000 550,000 May 2031 3.00 % 3.00 % 300,000 300,000 June 2032 5.50 % 5.50 % 300,000 300,000 Long-term debt before discount and debt issuance costs 2,989,742 1,447,800 Discount and debt issuance costs – unamortized (9,919) (10,400) Long-term debt $ 2,979,823 $ 1,437,400 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Schedule of lease cost | The components of lease cost related to the Company’s operating leases were as follows (in thousands): Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 Operating lease cost $ 16,917 $ 17,129 $ 33,482 $ 34,975 Variable lease cost 5,715 6,733 12,028 12,851 Total lease cost $ 22,632 $ 23,862 $ 45,510 $ 47,826 |
Schedule of future minimum operating lease payments | Future minimum operating lease payments as of December 31, 2022, are as follows (in thousands): Fiscal Year Remainder of fiscal 2023 $ 32,757 2024 53,201 2025 42,838 2026 33,816 2027 22,376 Thereafter 114,900 Total future operating lease payments 299,888 Total imputed interest on operating lease liabilities (47,958) Total operating lease liabilities $ 251,930 |
Schedule of other information pertaining to operating leases | Other information pertaining to operating leases consists of the following: Six Months Ended December 31, January 1, 2022 2022 Operating Lease Term and Discount Rate Weighted-average remaining lease term in years 8.4 8.9 Weighted-average discount rate 3.8 % 3.8 % |
Schedule of supplemental cash flow information | Supplemental cash flow information related to the Company’s operating leases was as follows (in thousands): Six Months Ended December 31, January 1, 2022 2022 Supplemental Cash Flow Information: Cash paid for operating lease liabilities $ 28,463 $ 29,456 Operating lease assets obtained from new operating lease liabilities 29,640 13,478 |
Derivative financial instrume_2
Derivative financial instruments (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Derivative financial instruments | |
Schedule of derivative instruments in the balance sheet | December 31, July 2, 2022 2022 (Thousands) Prepaid and other current assets $ 59,693 $ 24,907 Accrued expenses and other 36,536 29,663 |
Schedule of gain (loss) on derivatives | Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Net derivative financial instrument gain (loss) $ 11,543 $ (7,012) $ 11,184 $ (15,783) |
Pension and retirement plans (T
Pension and retirement plans (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Pension and retirement plan | |
Components of net periodic pension costs | Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Service cost $ 3,004 $ 3,751 $ 6,008 $ 7,503 Total net periodic pension cost within selling, general and administrative expenses 3,004 3,751 6,008 7,503 Interest cost 6,683 3,947 13,365 7,894 Expected return on plan assets (12,215) (12,284) (24,430) (24,568) Amortization of prior service cost 1 1 2 2 Recognized net actuarial loss 618 4,086 1,235 8,172 Total net periodic pension benefit within other income, net (4,913) (4,250) (9,828) (8,500) Net periodic pension benefit $ (1,909) $ (499) $ (3,820) $ (997) |
Earnings per share (Tables)
Earnings per share (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Earnings per share | |
Basic and diluted earnings per share calculation | Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands, except per share data) Numerator: Net income $ 243,886 $ 150,821 $ 428,147 $ 262,139 Denominator: Weighted average common shares for basic earnings per share 91,192 99,032 92,621 99,340 Net effect of dilutive stock-based compensation awards 1,563 1,254 1,574 1,361 Weighted average common shares for diluted earnings per share 92,755 100,286 94,195 100,701 Basic earnings per share $ 2.67 $ 1.52 $ 4.62 $ 2.64 Diluted earnings per share $ 2.63 $ 1.50 $ 4.55 $ 2.60 Stock options excluded from earnings per share calculation due to an anti-dilutive effect 174 927 174 880 |
Additional cash flow informat_2
Additional cash flow information (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Additional cash flow information | |
Interest and income taxes paid | Six Months Ended December 31, January 1, 2022 2022 (Thousands) Non-cash Investing Activities: Capital expenditures incurred but not paid $ 11,086 $ 5,547 Non-cash Financing Activities: Unsettled share repurchases — $ 275 Supplemental Cash Flow Information: Interest $ 110,167 $ 49,192 Income tax net payments 110,401 74,889 |
Segment information (Tables)
Segment information (Tables) | 6 Months Ended |
Dec. 31, 2022 | |
Segment information | |
Table of the Company's segments and the related financial information for each | Second Quarters Ended Six Months Ended December 31, January 1, December 31, January 1, 2022 2022 2022 2022 (Thousands) Sales: Electronic Components $ 6,309,494 $ 5,424,349 $ 12,633,717 $ 10,553,846 Farnell 408,027 440,868 833,937 896,066 6,717,521 5,865,217 13,467,654 11,449,912 Operating income: Electronic Components $ 296,709 $ 188,904 $ 563,962 $ 351,366 Farnell 36,905 60,189 88,516 109,781 333,614 249,093 652,478 461,147 Corporate (33,100) (33,625) (58,669) (66,925) Restructuring, integration and other expenses — — — (5,272) Amortization of acquired intangible assets and other (1,541) (3,796) (4,300) (9,035) Operating income $ 298,973 $ 211,672 $ 589,509 $ 379,915 Sales, by geographic area: Americas (1) $ 1,681,177 $ 1,391,567 $ 3,360,079 $ 2,650,377 EMEA (2) 2,255,878 1,840,789 4,385,418 3,588,368 Asia (3) 2,780,466 2,632,861 5,722,157 5,211,167 Sales $ 6,717,521 $ 5,865,217 $ 13,467,654 $ 11,449,912 (1) Includes sales from the United States of $1.57 billion and $1.29 billion for the second quarters ended December 31, 2022, and January 1, 2022, respectively. Includes sales from the United States of $3.13 billion and $2.45 billion for the first six months of fiscal 2023 and 2022, respectively. (2) Includes sales from Germany and Belgium of $956.5 million and $392.7 million, respectively, for the second quarter ended December 31, 2022; and $1.86 billion and $745.0 million, respectively, for the first six months of fiscal 2023. Includes sales from Germany and Belgium of $740.0 million and $330.7 million, respectively, for the second quarter ended January 1, 2022; and $1.44 billion and $638.3 million, respectively, for the first six months of fiscal 2022. (3) Includes sales from China (including Hong Kong), Taiwan and Singapore of $891.5 million, $1.19 billion and $360.9 million, respectively, for the second quarter ended December 31, 2022; and $1.85 billion, $2.46 billion and $754.9 million, respectively, for the first six months of fiscal 2023. Includes sales from China (including Hong Kong), Taiwan and Singapore of $863.0 million, $1.13 billion and $323.5 million, respectively, for the second quarter ended January 1, 2022; and $1.69 billion, $2.33 billion and $587.5 million, respectively, for the first six months of fiscal 2022. |
Table of Assets by reportable segment and long-lived assets by geographic area | December 31, July 2, 2022 2022 (Thousands) Property, plant, and equipment, net, by geographic area: Americas (1) $ 105,691 $ 115,422 EMEA (2) 244,710 170,128 Asia 27,868 29,654 Property, plant, and equipment, net $ 378,269 $ 315,204 (1) Includes property, plant and equipment, net, of $103.0 million and $112.4 million as of December 31, 2022, and July 2, 2022, respectively, in the United States. (2) Includes property, plant and equipment, net, of $142.6 million, $80.6 million and $16.0 million in Germany, the United Kingdom and Belgium, respectively, as of December 31, 2022; and $67.6 million, $79.8 million and $16.7 million in Germany, the United Kingdom and Belgium, respectively, as of July 2, 2022. |
Receivables (Details)
Receivables (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jul. 02, 2022 | Jan. 01, 2022 | Jul. 03, 2021 |
Receivables | ||||
Receivables | $ 4,895,907 | $ 4,414,904 | ||
Allowance for Credit Losses | $ (106,505) | $ (113,902) | $ (89,574) | $ (88,160) |
Receivables (Details)_2
Receivables (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Jan. 01, 2022 | |
Receivables, Allowance for Credit Loss [Roll Forward] | ||
Receivables, Allowance for Credit Loss, Beginning Balance | $ 113,902 | $ 88,160 |
Credit Loss Provisions | 4,803 | 8,391 |
Credit Loss Recoveries | (456) | (321) |
Receivables Write Offs | (12,476) | (4,930) |
Foreign Currency Effect and Other | 732 | (1,726) |
Receivables, Allowance for Credit Loss, Ending Balance | $ 106,505 | $ 89,574 |
Goodwill and intangible asset_2
Goodwill and intangible assets (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Jul. 02, 2022 | |
Carrying amount of goodwill, by reportable segment | ||
Carrying value | $ 758,833 | |
Foreign currency translation | (3,803) | |
Carrying value | 755,030 | |
Accumulated Impairment | 1,482,677 | $ 1,482,677 |
Electronic Components | ||
Carrying amount of goodwill, by reportable segment | ||
Carrying value | 291,526 | |
Foreign currency translation | 569 | |
Carrying value | 292,095 | |
Farnell | ||
Carrying amount of goodwill, by reportable segment | ||
Carrying value | 467,307 | |
Foreign currency translation | (4,372) | |
Carrying value | $ 462,935 |
Goodwill and intangible asset_3
Goodwill and intangible assets Textuals (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Goodwill and intangible assets | ||||
Intangible assets, net | $ 8,200 | $ 8,200 | ||
Intangible asset amortization expense | $ 1,500 | $ 3,800 | $ 4,294 | $ 8,964 |
Debt - short-term debt (Details
Debt - short-term debt (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Jul. 02, 2022 | |
Components of short-term debt | ||
Short-term debt | $ 209,401 | $ 174,422 |
Other Short -Term Debt | ||
Components of short-term debt | ||
Short-term Debt, Weighted Average Interest Rate | 4.85% | 2.09% |
Short-term debt | $ 209,401 | $ 174,422 |
Debt - long-term debt (Details)
Debt - long-term debt (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Dec. 31, 2022 | Jul. 02, 2022 | |
Debt Instrument [Line Items] | ||
Long-term debt before discount and debt issuance costs | $ 2,989,742 | $ 1,447,800 |
Discount and debt issuance costs - unamortized | (9,919) | (10,400) |
Long-term debt | $ 2,979,823 | $ 1,437,400 |
Revolving credit facilities | Accounts receivable securitization program | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Weighted Average Interest Rate | 5.21% | 2.55% |
Long-term debt before discount and debt issuance costs | $ 650,000 | $ 297,800 |
Revolving credit facilities | Line of credit | ||
Debt Instrument [Line Items] | ||
Long-term Debt, Weighted Average Interest Rate | 4.37% | |
Long-term debt before discount and debt issuance costs | $ 1,189,742 | |
Notes due | Notes Due April 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt, stated interest rate | 4.63% | 4.63% |
Long-term debt before discount and debt issuance costs | $ 550,000 | $ 550,000 |
Notes due | Notes Due May 2031 | ||
Debt Instrument [Line Items] | ||
Long-term debt, stated interest rate | 3% | 3% |
Long-term debt before discount and debt issuance costs | $ 300,000 | $ 300,000 |
Notes due | Notes Due June 2032 | ||
Debt Instrument [Line Items] | ||
Long-term debt, stated interest rate | 5.50% | 5.50% |
Long-term debt before discount and debt issuance costs | $ 300,000 | $ 300,000 |
Debt (Textuals) (Details)
Debt (Textuals) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Jul. 02, 2022 | |
Debt Instrument [Line Items] | ||
Debt Instrument Carrying Amount Noncurrent | $ 2,989,742 | $ 1,447,800 |
Company's total debt | ||
Debt, Long-term and Short-term, Combined Amount | 3,190,000 | 1,610,000 |
Total fair value | 3,080,000 | 1,550,000 |
Revolving credit facilities | Accounts receivable securitization program | ||
Debt Instrument [Line Items] | ||
Maximum borrowing amount | $ 650,000 | |
Term | 2 years | |
Accounts Receivable from Securitization | $ 1,280,000 | 1,120,000 |
Debt Instrument Carrying Amount Noncurrent | 650,000 | 297,800 |
Revolving credit facilities | Line of credit | ||
Debt Instrument [Line Items] | ||
Maximum borrowing amount | $ 1,500,000 | 1,250,000 |
Term | 5 years | |
Debt Instrument Carrying Amount Noncurrent | $ 1,189,742 | |
Letter of Credit | Line of credit | ||
Debt Instrument [Line Items] | ||
Maximum borrowing amount | 200,000 | |
Letters of credit outstanding, amount | 1,000 | $ 1,200 |
Notes Payable In Certain Approved Currencies | Line of credit | ||
Debt Instrument [Line Items] | ||
Maximum borrowing amount | $ 300,000 | |
Notes due | Notes Due June 2032 | ||
Debt Instrument [Line Items] | ||
stated interest rate | 5.50% | 5.50% |
Debt Instrument Carrying Amount Noncurrent | $ 300,000 | $ 300,000 |
Leases (Details)
Leases (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Leases [Abstract] | ||||
Lessee, Operating Lease, Term of Contract | 15 years | 15 years | ||
Lease Cost | ||||
Operating lease cost | $ 16,917 | $ 17,129 | $ 33,482 | $ 34,975 |
Variable lease cost | 5,715 | 6,733 | 12,028 | 12,851 |
Total lease cost | $ 22,632 | $ 23,862 | $ 45,510 | $ 47,826 |
Leases (Operating Lease Commitm
Leases (Operating Lease Commitments) (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
Remainder of fiscal 2023 | $ 32,757 |
2024 | 53,201 |
2025 | 42,838 |
2026 | 33,816 |
2027 | 22,376 |
Thereafter | 114,900 |
Total future operating lease payments | 299,888 |
Total imputed interest on operating lease liabilities | (47,958) |
Total operating lease liabilities | $ 251,930 |
Leases (Other Lease Information
Leases (Other Lease Information) (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Dec. 31, 2022 | Jan. 01, 2022 | |
Leases [Abstract] | ||
Operating lease weighted-average remaining lease term | 8 years 4 months 24 days | 8 years 10 months 24 days |
Operating lease weighted-average discount rate | 3.80% | 3.80% |
Cash paid for operating lease liabilities | $ 28,463 | $ 29,456 |
Operating lease assets obtained from new operating lease liabilities | $ 29,640 | $ 13,478 |
Derivative financial instrume_3
Derivative financial instruments Textuals (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Dec. 31, 2022 | Jul. 02, 2022 | |
Derivative fair value | ||
Derivative assets fair value | $ 59,693 | $ 24,907 |
Derivative Asset, Statement of Financial Position [Extensible Enumeration] | Prepaid Expense and Other Assets, Current | Prepaid Expense and Other Assets, Current |
Derivative liabilities fair value | $ 36,536 | $ 29,663 |
Derivative Liability, Statement of Financial Position [Extensible Enumeration] | Accrued Liabilities, Current | Accrued Liabilities, Current |
Minimum | Foreign Exchange Forward | ||
Derivatives, Fair Value [Line Items] | ||
Maximum maturity of foreign exchange contracts (less than one year) | 60 days | |
Maximum | Foreign Exchange Forward | ||
Derivatives, Fair Value [Line Items] | ||
Maximum maturity of foreign exchange contracts (less than one year) | 1 year |
Derivative financial instrume_4
Derivative financial instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Derivative financial instruments | ||||
Net derivative financial instrument gain (loss) | $ 11,543 | $ (7,012) | $ 11,184 | $ (15,783) |
Derivative, Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration] | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) | Other Nonoperating Income (Expense) |
Commitments and contingencies (
Commitments and contingencies (Textuals) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2022 | Jul. 02, 2022 | |
Loss Contingency, Estimate [Abstract] | |||
Estimate of possible loss | $ 14,700 | $ 14,700 | $ 14,700 |
Gain on legal settlement | $ 61,705 | 61,705 | |
Proceeds from legal settlement | $ 51,200 |
Income taxes (Details)
Income taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Income taxes | ||||
Effective tax rate | 19.50% | 21.40% | 22% | 22.20% |
Pension and retirement plans (P
Pension and retirement plans (Periodic Pension Cost) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Components of net periodic pension costs | ||||
Service cost | $ 3,004 | $ 3,751 | $ 6,008 | $ 7,503 |
Interest cost | 6,683 | 3,947 | 13,365 | 7,894 |
Expected return on plan assets | (12,215) | (12,284) | (24,430) | (24,568) |
Amortization of prior service cost | 1 | 1 | 2 | 2 |
Recognized net actuarial loss | 618 | 4,086 | 1,235 | 8,172 |
Net periodic pension benefit | (1,909) | (499) | (3,820) | (997) |
Selling, General and Administrative Expenses | ||||
Components of net periodic pension costs | ||||
Net periodic pension benefit | 3,004 | 3,751 | 6,008 | 7,503 |
Other Income, net | ||||
Components of net periodic pension costs | ||||
Net periodic pension benefit | (4,913) | $ (4,250) | (9,828) | $ (8,500) |
Plan | ||||
Components of net periodic pension costs | ||||
Contributions | 4,000 | |||
Estimated future employer pension plan contributions | $ 4,000 | $ 4,000 |
Shareholders' equity (Share rep
Shareholders' equity (Share repurchase program textuals) (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions | 3 Months Ended | 6 Months Ended | ||
Nov. 23, 2022 | Dec. 31, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Shareholders' equity | ||||
Increase in authorized repurchase amount | $ 600,000 | $ 600,000 | ||
Shares repurchased during period (in shares) | 1.6 | |||
Cost of repurchase | $ 64,400 | |||
Remaining authorized repurchase amount | 319,000 | 319,000 | ||
Common Stock, Dividends, Per Share, Declared | $ 0.29 | |||
Dividends paid on common stock | $ 26,300 | $ 53,304 | $ 47,642 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Dec. 31, 2022 | Oct. 01, 2022 | Jan. 01, 2022 | Oct. 02, 2021 | Dec. 31, 2022 | Jan. 01, 2022 | |
Numerator: | ||||||
Net income | $ 243,886 | $ 184,261 | $ 150,821 | $ 111,318 | $ 428,147 | $ 262,139 |
Denominator: | ||||||
Weighted average common shares for basic earnings per share | 91,192 | 99,032 | 92,621 | 99,340 | ||
Net effect of dilutive stock based compensation awards | 1,563 | 1,254 | 1,574 | 1,361 | ||
Weighted average common shares for diluted earnings per share | 92,755 | 100,286 | 94,195 | 100,701 | ||
Basic earnings per share | $ 2.67 | $ 1.52 | $ 4.62 | $ 2.64 | ||
Diluted earnings per share | $ 2.63 | $ 1.50 | $ 4.55 | $ 2.60 | ||
Stock Options | ||||||
Denominator: | ||||||
antidilutive Securities | 174 | 927 | 174 | 880 |
Additional cash flow informat_3
Additional cash flow information (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Jul. 02, 2022 | |
Interest and income taxes paid | |||
Capital expenditures incurred but not paid | $ 11,086 | $ 5,547 | |
Unsettled share repurchases | 275 | ||
Interest | 110,167 | 49,192 | |
Income tax net payments | 110,401 | $ 74,889 | |
Cash equivalents | $ 4,400 | $ 5,400 |
Segment information (Details)
Segment information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Sales, by segment | ||||
Sales | $ 6,717,521 | $ 5,865,217 | $ 13,467,654 | $ 11,449,912 |
Operating income (loss): | ||||
Restructuring, integration and other expenses | (5,272) | |||
Amortization of acquired intangible assets and other | (1,541) | (3,796) | (4,300) | (9,035) |
Operating income | 298,973 | 211,672 | 589,509 | 379,915 |
Segment | ||||
Operating income (loss): | ||||
Operating income | 333,614 | 249,093 | 652,478 | 461,147 |
Corporate | ||||
Operating income (loss): | ||||
Corporate | (33,100) | (33,625) | (58,669) | (66,925) |
Electronic Components | Segment | ||||
Sales, by segment | ||||
Sales | 6,309,494 | 5,424,349 | 12,633,717 | 10,553,846 |
Operating income (loss): | ||||
Operating income | 296,709 | 188,904 | 563,962 | 351,366 |
Farnell | Segment | ||||
Sales, by segment | ||||
Sales | 408,027 | 440,868 | 833,937 | 896,066 |
Operating income (loss): | ||||
Operating income | $ 36,905 | $ 60,189 | $ 88,516 | $ 109,781 |
Segment information (Sales, by
Segment information (Sales, by geographic area) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Dec. 31, 2022 | Jan. 01, 2022 | Dec. 31, 2022 | Jan. 01, 2022 | |
Sales, by geographic area: | ||||
Sales | $ 6,717,521 | $ 5,865,217 | $ 13,467,654 | $ 11,449,912 |
Americas | ||||
Sales, by geographic area: | ||||
Sales | 1,681,177 | 1,391,567 | 3,360,079 | 2,650,377 |
United States | ||||
Sales, by geographic area: | ||||
Sales | 1,570,000 | 1,290,000 | 3,130,000 | 2,450,000 |
EMEA | ||||
Sales, by geographic area: | ||||
Sales | 2,255,878 | 1,840,789 | 4,385,418 | 3,588,368 |
Germany | ||||
Sales, by geographic area: | ||||
Sales | 956,500 | 740,000 | 1,860,000 | 1,440,000 |
Belgium | ||||
Sales, by geographic area: | ||||
Sales | 392,700 | 330,700 | 745,000 | 638,300 |
Asia | ||||
Sales, by geographic area: | ||||
Sales | 2,780,466 | 2,632,861 | 5,722,157 | 5,211,167 |
Taiwan | ||||
Sales, by geographic area: | ||||
Sales | 1,190,000 | 1,130,000 | 2,460,000 | 2,330,000 |
China (including Hong Kong) | ||||
Sales, by geographic area: | ||||
Sales | 891,500 | 863,000 | 1,850,000 | 1,690,000 |
SINGAPORE | ||||
Sales, by geographic area: | ||||
Sales | $ 360,900 | $ 323,500 | $ 754,900 | $ 587,500 |
Segment information (Property,
Segment information (Property, plant and equipment, net, by geographic area) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Jul. 02, 2022 |
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | $ 378,269 | $ 315,204 |
Americas | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 105,691 | 115,422 |
United States | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 103,000 | 112,400 |
EMEA | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 244,710 | 170,128 |
Germany | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 142,600 | 67,600 |
United Kingdom | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 80,600 | 79,800 |
Belgium | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | 16,000 | 16,700 |
Asia | ||
Property, plant and equipment, net, by geographic area | ||
Property, plant and equipment, net | $ 27,868 | $ 29,654 |