ScanSource (SCSC) 8-K ScanSource Reports Fourth Quarter and Fiscal Year Results

Exhibit 99.1

ScanSource Reports Fourth Quarter and Fiscal Year Results

FOR IMMEDIATE RELEASE

Contact:	Richard P. Cleys
	VP and CFO
	ScanSource, Inc.
	(864) 286-4358

SCANSOURCE ACHIEVES RECORD ANNUAL REVENUES AND EARNINGS

Excellent results realized in AIDC, Communications and Security Products

GREENVILLE, SC — August 18, 2011—ScanSource, Inc. (NASDAQ:SCSC), the leading international distributor of AIDC (automatic identification and data capture), point of sale, communications, and physical security products for the reseller market, today announced complete financial results for its fourth quarter and fiscal year ended June 30, 2011.

Quarter ended June 30, 2011:			Fiscal Year ended June 30, 2011:
Net sales	$	735 million	Net sales	$	2,667 million
Net income	$	19.7 million	Net income	$	73.5 million
Diluted EPS	$	0.71 per share	Diluted EPS	$	2.70 per share

“ScanSource delivered record results in a tough economy by focusing on our core competencies and taking market share,” said Mike Baur, CEO, ScanSource, Inc. “All of our business units performed exceptionally well, with the strongest year-over-year growth in our International segment.”

For the quarter ended June 30, 2011, net sales increased 26.2% to $734.9 million compared to $582.3 million for the quarter ended June 30, 2010. Operating income increased by 39.4% to $29.2

ScanSource Reports Fourth Quarter and Fiscal Year Results

million from $21.0 million in the comparable prior year quarter. Net income increased 39.9% to $19.7 million for the quarter ended June 30, 2011 versus $14.0 million for the quarter ended June 30, 2010. The effective tax rate for the quarter decreased to 31.7% in the current quarter from 33.1% in the prior year quarter. Diluted earnings per share increased 36.5% to $0.71 in the current quarter compared to $0.52 in the prior year quarter.

For the year ended June 30, 2011, net sales increased $552 million or 26.1% to $2.7 billion, from the prior year ended June 30, 2010. Fiscal year operating income also increased 49.3% to $113.1 million from $75.8 million from the prior year. Net income increased 50.6% to $73.5 million compared to $48.8 million from the prior fiscal year. The effective tax rate for the year was 34.3% compared to 35.6% for the prior fiscal year. Diluted earnings per share increased 48.4% to $2.70 compared to $1.82 in the prior fiscal year.

Forecast for Next Quarter

The Company announced its revenue forecast for the first quarter of fiscal 2012. ScanSource expects that net revenues for the quarter ending September 30, 2011 could range from $730 million to $750 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 or forecasted results, including, but not limited to, factors affecting our expanded operations in emerging markets, such as Brazil, that expose us to greater political and

ScanSource Reports Fourth Quarter and Fiscal Year Results

economic volatility than our operations in established markets, the results of purchase accounting, macroeconomic circumstances that could impact our business, such as currency fluctuations, continued adverse capital and credit market conditions and a continued 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, 2010 filed with, and the Company’s annual report on Form 10-K for the year ended June 30, 2011 to be filed with, the Securities and Exchange Commission.

About ScanSource, Inc.

ScanSource, Inc. (NASDAQ:SCSC) is the 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 #839 on the Fortune 1000. For more information, call the toll-free sales telephone number at 800.944.2432 or visit www.scansourceinc.com.

ScanSource Reports Fourth Quarter and Fiscal Year Results

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets (Unaudited)

(in thousands)

	June 30, 2011		June 30, 2010 *
Assets
Current assets:
Cash and cash equivalents	$	28,747	$	34,605
Accounts receivable, less allowance of		462,102		357,749
$26,562 at June 30, 2011
$21,907 at June 30, 2010
Inventories		467,350		346,610
Prepaid expenses and other assets		35,421		16,762
Deferred income taxes		15,894		12,066
Total current assets		1,009,514		767,792
Property and equipment, net		36,819		23,528
Goodwill		59,090		33,785
Other assets, including identifiable intangible assets		76,765		34,645
Total assets	$	1,182,188	$	859,750
Liabilities and Shareholders’ Equity
Current liabilities:
Current portion of long-term debt	$	—	$	—
Short-term borrowings		3,164		—
Current portion of contingent consideration		2,398		—
Accounts payable		406,453		287,864
Accrued expenses and other liabilities		60,157		35,027
Income taxes payable		5,175		7,948
Total current liabilities		477,347		330,839
Long-term debt		30,429		30,429
Borrowings under revolving credit facility		26,513		—
Long-term portion of contingent consideration		21,396		—
Other long-term liabilities		39,109		11,631
Total liabilities		594,794		372,899
Shareholders’ equity:
Common stock		123,608		111,951
Retained earnings		460,157		386,634
Accumulated other comprehensive loss		3,629		(11,734	)
Total shareholders’ equity		587,394		486,851
Total liabilities and shareholders’ equity	$	1,182,188	$	859,750

* Derived from audited financial statements at June 30, 2010.

ScanSource Reports Fourth Quarter and Fiscal Year Results

ScanSource, Inc. and Subsidiaries

Condensed Consolidated Income Statements (Unaudited)

(in thousands, except per share information)

	Quarter ended June 30,						Year ended June 30,
	2011			2010*			2011			2010*
Net sales	$	734,891		$	582,342		$	2,666,531		$	2,114,979
Cost of goods sold		660,520			525,520			2,392,224			1,896,052
Gross profit		74,371			56,822			274,307			218,927
Operating expenses:
Selling, general and administrative expenses		45,129			35,840			161,198			143,151
Operating income		29,242			20,982			113,109			75,776
Other expense (income):
Interest expense		541			365			1,723			1,472
Interest income		(294	)		(228	)		(1,212	)		(1,387	)
Other, net		220			(150	)		712			(50	)
Income before income taxes		28,775			20,995			111,886			75,741
Provision for income taxes		9,115			6,947			38,363			26,929
Net income	$	19,660		$	14,048		$	73,523		$	48,812
Per share data:
Net income per common share, basic	$	0.73		$	0.53		$	2.74		$	1.83
Weighted-average shares outstanding, basic		27,056			26,669			26,872			26,605
Net income per common share, diluted	$	0.71		$	0.52		$	2.70		$	1.82
Weighted-average shares outstanding, diluted		27,515			26,937			27,246			26,869

* Derived from audited financial statements at June 30, 2010