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ScanSource Q4 Earnings Lag Estimates, Revenues Fall Y/Y
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ScanSource, Inc. (SCSC - Free Report) reported adjusted earnings of 80 cents per share in fourth-quarter fiscal 2024 (ended June 30, 2024), missing the Zacks Consensus Estimate of 95 cents. The bottom line, however, improved 5.3% from the prior-year quarter’s earnings of 76 cents.
On a reported basis, the company delivered earnings of 64 cents per share compared with the prior-year quarter’s 68 cents per share.
ScanSource, Inc. Price, Consensus and EPS Surprise
The company reported net sales of $746 million in the quarter under review, down 21.2% from the year-ago quarter’s level. The top line missed the Zacks Consensus Estimate of $841 million.
Net sales in the United States and Canada were down 22.3% to $663.5 million. International sales decreased 10.9% to $82.5 million.
Specialty Technology Solutions’ revenues fell 13.7% to $485 million in fourth-quarter fiscal 2024, courtesy of softer demand.
Sales at Modern Communications & Cloud were $261 million in the reported quarter, down 32.2% year over year, due to lower volumes in communications hardware and Cisco products.
ScanSource’s Margins Decline in Q4
The cost of sales amounted to $649 million in the fiscal fourth quarter, down 22.6% from the year-ago quarter’s level. The gross profit totaled $97 million, down 10.8% from the year-ago quarter’s $111 million. The gross margin came in at 13% during the reported quarter compared with prior-year quarter’s 11.5%.
Selling, general and administrative expenses fell 7.9% year over year to $68 million. The adjusted operating profit was $26 million in comparison to the prior-year quarter’s $32.8 million. Adjusted EBITDA was down 15% year over year to $34 million. The adjusted EBITDA margin was 4.6% compared with 4.2% reported in the prior year’s quarter.
SCSC’s Cash Position & Balance Sheet
The company reported cash and cash equivalents of $185 million as of June 30, 2024, in comparison to $36 million as of June 30, 2023. The company generated $55 million of cash in operating activities in the fiscal fourth quarter against cash outflow of $15 million in the prior-year quarter. The company’s long-term debt was $136 million at the end of fiscal 2024, down from $144 million at the end of fiscal 2023.
Fiscal 2024 Performance of ScanSource
ScanSource reported adjusted earnings per share of $3.08 in fiscal 2024, in comparison with $3.85 reported in the prior fiscal. The bottom line missed the Zacks Consensus Estimate of $3.31.
Including one-time items, the bottom line came in at $3.06, down 11.8% from $3.47 reported in fiscal 2023. Sales were down 13.9% year over year to $3.26 billion due to softer demand. The top line missed the Zacks Consensus Estimate of $3.35 billion.
SCSC Fiscal 2025 Outlook
ScanSource expects net sales to be in the range of $3.1 billion to $3.5 billion for fiscal 2025. Adjusted EBITDA is projected to be between $140 million and $160 million. The company expects a free cash flow of at least $70 million.
SCSC’s Share Price Performance
ScanSource's shares have gained 54.5% in the past year compared with industry’s 0.3% growth.
MSC Industrial Direct Company, Inc. (MSM - Free Report) reported third-quarter fiscal 2024 (ended on June 1, 2024) adjusted EPS of $1.33, in line with the Zacks Consensus Estimate. The bottom line decreased 23.6% year over year, due to the prolonged weakness in the manufacturing sector, wherein MSM has a significant exposure. MSC Industrial generated revenues of around $979 million, down 7% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $993 million.
SiteOne Landscape Supply, Inc. (SITE - Free Report) reported adjusted earnings per share of $2.63 in the second quarter of 2024, beating the Zacks Consensus Estimate of $2.50. The company posted earnings of $2.71 per share in the second quarter of 2023. SITE posted revenues of $1.41 billion for the June-end quarter of 2024, surpassing the Zacks Consensus Estimate of $1.38 billion. The top line rose 4.4% year over year.
Hudson Technologies (HDSN - Free Report) came out with second-quarter earnings of 20 cents per share, missing the Zacks Consensus Estimate of 26 cents. The metric was down compared with earnings of 41 cents per share a year ago. HDSN posted revenues of $75.3 million for the quarter ended June 2024, missing the Zacks Consensus Estimate of $79 million. The metric was down compared with year-ago revenues of $90.5 million.
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ScanSource Q4 Earnings Lag Estimates, Revenues Fall Y/Y
ScanSource, Inc. (SCSC - Free Report) reported adjusted earnings of 80 cents per share in fourth-quarter fiscal 2024 (ended June 30, 2024), missing the Zacks Consensus Estimate of 95 cents. The bottom line, however, improved 5.3% from the prior-year quarter’s earnings of 76 cents.
On a reported basis, the company delivered earnings of 64 cents per share compared with the prior-year quarter’s 68 cents per share.
ScanSource, Inc. Price, Consensus and EPS Surprise
ScanSource, Inc. price-consensus-eps-surprise-chart | ScanSource, Inc. Quote
SCSC’s Revenues Plunge on Weak Demand
The company reported net sales of $746 million in the quarter under review, down 21.2% from the year-ago quarter’s level. The top line missed the Zacks Consensus Estimate of $841 million.
Net sales in the United States and Canada were down 22.3% to $663.5 million. International sales decreased 10.9% to $82.5 million.
Specialty Technology Solutions’ revenues fell 13.7% to $485 million in fourth-quarter fiscal 2024, courtesy of softer demand.
Sales at Modern Communications & Cloud were $261 million in the reported quarter, down 32.2% year over year, due to lower volumes in communications hardware and Cisco products.
ScanSource’s Margins Decline in Q4
The cost of sales amounted to $649 million in the fiscal fourth quarter, down 22.6% from the year-ago quarter’s level. The gross profit totaled $97 million, down 10.8% from the year-ago quarter’s $111 million. The gross margin came in at 13% during the reported quarter compared with prior-year quarter’s 11.5%.
Selling, general and administrative expenses fell 7.9% year over year to $68 million. The adjusted operating profit was $26 million in comparison to the prior-year quarter’s $32.8 million. Adjusted EBITDA was down 15% year over year to $34 million. The adjusted EBITDA margin was 4.6% compared with 4.2% reported in the prior year’s quarter.
SCSC’s Cash Position & Balance Sheet
The company reported cash and cash equivalents of $185 million as of June 30, 2024, in comparison to $36 million as of June 30, 2023. The company generated $55 million of cash in operating activities in the fiscal fourth quarter against cash outflow of $15 million in the prior-year quarter. The company’s long-term debt was $136 million at the end of fiscal 2024, down from $144 million at the end of fiscal 2023.
Fiscal 2024 Performance of ScanSource
ScanSource reported adjusted earnings per share of $3.08 in fiscal 2024, in comparison with $3.85 reported in the prior fiscal. The bottom line missed the Zacks Consensus Estimate of $3.31.
Including one-time items, the bottom line came in at $3.06, down 11.8% from $3.47 reported in fiscal 2023. Sales were down 13.9% year over year to $3.26 billion due to softer demand. The top line missed the Zacks Consensus Estimate of $3.35 billion.
SCSC Fiscal 2025 Outlook
ScanSource expects net sales to be in the range of $3.1 billion to $3.5 billion for fiscal 2025. Adjusted EBITDA is projected to be between $140 million and $160 million. The company expects a free cash flow of at least $70 million.
SCSC’s Share Price Performance
ScanSource's shares have gained 54.5% in the past year compared with industry’s 0.3% growth.
Image Source: Zacks Investment Research
Stock’s Zacks Rank
ScanSource currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
SCSC’s Peer Performances
MSC Industrial Direct Company, Inc. (MSM - Free Report) reported third-quarter fiscal 2024 (ended on June 1, 2024) adjusted EPS of $1.33, in line with the Zacks Consensus Estimate. The bottom line decreased 23.6% year over year, due to the prolonged weakness in the manufacturing sector, wherein MSM has a significant exposure. MSC Industrial generated revenues of around $979 million, down 7% from the year-ago quarter. The top line missed the Zacks Consensus Estimate of $993 million.
SiteOne Landscape Supply, Inc. (SITE - Free Report) reported adjusted earnings per share of $2.63 in the second quarter of 2024, beating the Zacks Consensus Estimate of $2.50. The company posted earnings of $2.71 per share in the second quarter of 2023. SITE posted revenues of $1.41 billion for the June-end quarter of 2024, surpassing the Zacks Consensus Estimate of $1.38 billion. The top line rose 4.4% year over year.
Hudson Technologies (HDSN - Free Report) came out with second-quarter earnings of 20 cents per share, missing the Zacks Consensus Estimate of 26 cents. The metric was down compared with earnings of 41 cents per share a year ago. HDSN posted revenues of $75.3 million for the quarter ended June 2024, missing the Zacks Consensus Estimate of $79 million. The metric was down compared with year-ago revenues of $90.5 million.