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[PIONEER-STANDARD ELECTRONICS, INC. LETTERHEAD]
Contact: John V. Goodger July 16, 1996
216/587-3600 FOR IMMEDIATE RELEASE
PIONEER-STANDARD REPORTS RECORD FIRST QUARTER SALES
CLEVELAND, July 16, Record sales of Pioneer-Standard Electronics, Inc.
(NASDAQ.PIOS) of $375,156,000 for the first quarter ended June 30, 1996, reflect
especially strong demand for computer systems products. The current quarter
sales, which include the sales of Pioneer-Standard of Maryland, the Company's
former affiliate which Pioneer acquired in November, 1995, were up 67 percent
from the $224,724,000 recorded last year. The Company's sales, excluding the
newly acquired affiliate, were $268,517,000, up 19 percent from last year.
Operating profit was up 19 percent in the quarter. A shift in product
mix and higher interest costs from increased debt led to slightly lower earnings
compared to last year. The increased debt resulted from the purchase of the
Company's former 50 percent-owned affiliate and to fund working capital needs to
support the growth of the business. Net income for the Cleveland-based
distributor of industrial electronic components and systems integrator of
computer products and peripherals totaled $6,151,000 compared with $6,816,000
earned a year earlier. Earnings per share of 27 cents were 7 percent below the
29 cents in first quarter a year ago. Net income in the current year quarter
included 100 percent of the Company's former affiliate. In the prior year, net
income included only a 50 percent equity interest in the affiliate's earnings.
Per share amounts for the prior year have been adjusted to reflect a 3-for-2
split of the Company's common shares effective September 6, 1995.
James L. Bayman, chairman, president and chief executive officer of
Pioneer, said that demand for computer systems products is driving sales growth
throughout the industrial electronics distribution industry. "While business
levels remain quite good, the rate of increase has somewhat moderated from the
torrid pace of the past two years. We continue to invest in initiatives that
foster long-term growth and greater operating efficiencies, including training
and process improvements," Bayman added.
Pioneer ranks fourth worldwide among industrial electronics
distributors. Pioneer serves the approximately $21 billion North American
industrial electronics distribution market from more than 50 locations supplying
technical support, electronic components and systems integration of computer
products and peripherals. Pioneer is International Organization for
Standardization (ISO) certified and has an ISO-9002 registration for its sales,
product management operations, commercial and military warehouses, systems
integration, and connector and cable assembly operations. Additional information
about Pioneer and its business partners can be found on the World Wide Web at
http://www.pios.com.
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(TABLE ATTACHED)
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PIONEER-STANDARD ELECTRONICS, INC.
(Dollars in thousands except per share amounts, unaudited)
SALES AND EARNINGS
Three Months
Period ended June 30 1996 1995
-------------------- ---- ----
Net sales $375,156 $224,724
Cost of sales 308,990 181,114
Operating expenses 51,348 31,148
-------- --------
Operating profit 14,818 12,462
Interest expense 3,904 1,449
Equity earnings ---- 451
-------- --------
Income before taxes 10,914 11,464
Taxes 4,763 4,648
-------- --------
Net income $ 6,151 $ 6,816
======== ========
Earnings per share $ .27 $ .29
Dividends per share $ .03 $ .023
Average shares outstanding 23,138,433 23,085,351
Shares outstanding, end of period 22,534,167 22,427,731
CONDENSED BALANCE SHEETS
June 30, 1996 and 1995
Assets 1996 1995 Liabilities & Equity 1996 1995
- ------ ---- ---- -------------------- ---- ----
Current assets Current Liabilities
Cash $ 31,713 $ 16,454 Current debt $ 29,500 $ 3,000
Receivables 204,973 129,518 Accounts payable 163,576 113,450
Inventory 263,914 147,172 Other 41,100 29,665
Other 13,256 7,986 -------- --------
-------- -------- Total $234,176 $146,115
Total $513,856 $301,130 Long-term debt 212,481 77,316
Net fixed assets 47,961 34,837 Deferred taxes 2,328 2,232
Intangible & Other 43,636 23,051 Equity 156,468 133,355
-------- -------- -------- --------
$605,453 $359,018 $605,453 $359,018
======== ======== ======== ========
Per share figures and shares outstanding are adjusted to reflect the September
6, 1995 3-for-2 share split.
Effective November 30, 1995, the Company acquired the remaining 50% of the
common stock of Pioneer-Standard of Maryland, Inc. that it did not already own.
The income statement for the current year quarter includes the operating results
of Maryland. The balance sheet as of June 30, 1996 includes the assets and
liabilities of the two companies on a consolidated basis. Prior to the
acquisition, the Company included 50% of Maryland's net income on the equity
method and sales of the two companies were not consolidated for reporting
purposes. Proforma sales of the two organizations for the 1995 quarter were
$304,211,000.
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