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ScanSource Reports Third Quarter Results

ScanSource, Inc. (NASDAQ:SCSC), the leading international value-added distributor of specialty technology products, today announced financial results for fiscal year 2015 third quarter ended March 31, 2015.

Net sales for the quarter ended March 31, 2015 totaled $763.2 million, a 12% increase over net sales of $683.0 million for the quarter ended March 31, 2014. Excluding the translation impact of foreign currencies, net sales increased 16% year-over-year. The increase in net sales included a full quarter of net sales from the acquisitions of Imago and Network1, each completed during the current fiscal year.

“We had a busy quarter and completed several key strategic initiatives,” said Mike Baur, CEO, ScanSource, Inc. “Our successful acquisitions of Network1 and Imago contributed to the strong sales growth in our Worldwide Communications and Services segment.  As planned, we implemented our new global ERP system in Europe with minimal disruption to our business.”

Operating income for quarter ended March 31, 2015 totaled $21.5 million, compared with $25.7 million in the prior year quarter. Excluding adjustments, non-GAAP operating income for the quarter ended March 31, 2015 decreased 12% over the prior year quarter to $24.2 million from $27.6 million. Selling, general and administrative expenses for the quarter ended March 31, 2015 included $2.6 million pre-tax ($1.6 million after-tax, or $0.06 per diluted share) non-recurring SAP-related expenses associated with the implementation of the Company’s Enterprise Resource Planning (ERP) system.

“We are deploying capital in accordance with our plan of strategic acquisitions, share repurchases, and investment in our global ERP system,” said Charlie Mathis, CFO, ScanSource, Inc.

On a GAAP basis, net income for the quarter ended March 31, 2015 totaled $12.9 million, or $0.45 per diluted share, compared with net income of $16.9 million, or $0.59 per diluted share, for the prior year quarter. Excluding adjustments, non-GAAP net income for the quarter ended March 31, 2015 decreased to $14.9 million, or $0.52 per diluted share, from $18.2 million, or $0.63 per diluted share.

Forecast for Next Quarter
The Company announced its current expectations for the fourth quarter of fiscal year 2015. ScanSource expects net sales for the quarter ending June 30, 2015 to range from $800 million to $850 million and non-GAAP diluted earnings per share to range from $0.56 to $0.62 per share. Non-GAAP diluted earnings per share exclude amortization of intangibles and change in fair value of contingent consideration, and acquisition costs.

Webcast Details
ScanSource will present additional information about its financial results and outlook in a conference call with presentation slides today, April 30, 2015 at 5:00 p.m. (ET).  A webcast of the call and accompanying presentation slides will be available for all interested parties and can be accessed at www.scansource.com (Investor Relations section).  The webcast will be available for replay for 60 days.

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