Tag: Avnet

Avnet finishes Tech Data UK integration early

The BorgAvnet will have finished its Tech Data UK integration by the start of November.

For those who came in late, Tech Data closed its Avnet TS buyout in February this year, and thought that the scale of both businesses would mean that full integration could take up to 12 months.

However, Belgium, Iberia and Italy are already integrated and France and the UK should be completed by the beginning of November, the company said.

By the end of this calendar year, approximately two thirds of the business will be fully integrated.

That did not mean that the integration had not been complex, and Avnet is still checking with customers and vendors if things went ok.

The $2.6 billion deal gave the distributor a presence in the APAC region and boosted its employee count to 14,000 employees across 40 countries globally.

Tech Data will phase out its Azlan brand by the end of Q1 2018, citing the results of a brand study, which discovered that no one in Europe could recognise Azlan in a line-up.

“Awareness of Azlan’s reputation was only recognised in only a limited number of countries, mainly the UK and a bit in France. It was not consistent, so our study recommended putting Tech Data at the front as a master brand”,  the company said.

 

Tech Data’s shares crash

Tech Data’s shares Wall Street Crash, Wikimedia Commonscrashed after its numbers failed to impress analysts and it complained of missing vendor rebate targets.

For those who came in late, Tech Data’s moves to buy out Avnet Technology Solutions received the thumbs up from Wall Street, with its share price rising 27 percent for the year to date.

But now its market value has dropped 19 percent as the company missed its quarterly profit targets and disappointed Wall Street with its guidance.

This is Tech Data’s first full quarter since it sealed the Avnet mega-merger in February, and the deal has made it even bigger than everyone expected, with Q2 revenues surging 40 percent annually to $8.9 billion.  Growth in both Europe and the Americas was in the low single digits.

Avnet TS has also breathed fresh life into Tech Data’s margins. Gross margins hit 5.8 percent for the quarter, up from 4.98 percent a year earlier, as the more enterprise-focused Avnet business made its margin-enriching presence felt.

But Tech Data’s gross margins and earnings should have been even higher than this.  The outfit blamed the shortfall on execution issues, increased competition and a fall in rebates from some of its key vendor partners.

Despite this, Tech Data’s shares are still up by about five percent for the year to date as CEO Robert Dutkowsky argued that the giant is a “stronger and more complex company today than it was a year ago”.

A “significant piece” of the shortfall was generated by Tech Data missing its vendor rebate targets, Dutkowsky revealed on a Q2 earnings call.

Dutkowsky pointed the finger at Avnet’s biggest vendors when he said that the problem lies mainly with “a few very large vendors”… “and these are not vendors that we have had a long history of managing at the volume and scale and scope that we had to manage through this quarter”.

During Q2, only Apple (12 percent), HP Inc (11 percent) and Cisco (11 percent) generated over 10 per cent of Tech Data’s sales, but it inherited a big relationship with IBM through the Avnet union.

Dutkowsky said that a relatively small sales shortfall in technologies it carries in its newly enlarged datacentre arm can result in it missing margin-rich rebates, due to the project-based nature of the business.

A number of vendors on this side of its business changed their rebate programmes during the quarter, affecting its profitability, he indicated. To make matters worse, several major vendors didn’t grow at the rate they planned during the quarter, Dutkowsky added, making it even harder to hit rebate targets that were assigned based on projected growth.

“We’re learning to manage the challenges and the complexities and that’s why we can say that that fits into that category of execution, and we know we can execute better in this area and we will,” he said on the call.

Avnet and Ingram see sales fall

avnettsJust as Ingram is about to be bought, HNA and Avnet gears up to sell TS unit to Tech Data, both outfits are seeing their sales slide.

It is no big news, both Avnet and Ingram Micro have seen several quarters of sales doom as they start their M&A activity.

Ingram’s Q3, which ended 1 October, net profits jumped 21 per cent annually to $78.5m (£64.4m) on sales which were down three per cent over the same period to $10.2 billion.  Ingram is becoming part of the Chinese giant HNA. It did not hold a Q3 earnings call or provide a financial outlook for that reason.

Tts CEO Alain Monié did say the third quarter had been seen “robust improvement in gross and operating margins.”

“We see further stabilisation in market demand across most of the globe and our teams continue to leverage our investments in productivity and services to deliver improved bottom-line results and growth in a number of areas as we benefit from the broadest solutions portfolio and widest geographic reach in the industry,” he added.

Avnet is trying to sell its Technology Solutions arm to Tech Data. For the combined business, including TS, net profit fell 47.1 per cent annually to $68.8m, on sales which slumped 13 per cent over the same period to $6bn.

This means that TS performed “below expectations”, with sales falling 21.2 per cent annually to $1.87bn.

CEO William Ameilo said Avnet’s future without TS looks bright.

“In summary, the sale of TS allows us to focus on electronic components business, to which we just added unique capability with the acquisition of Premier Farnell while providing significant capital to strengthen our balance sheet and fund future growth,” he said.

Bill Amelio is Avnet boss

long.amelio.cnnAvnet has named former Lenovo leader Bill Amelio as its CEO.

Amelio  held the job since July after longtime leader Rick Hamada stepped down. The outfit needs to make a few changes particularly when it comes to making more cash for shareholders and the adoption of emerging technologies.

William Schumann, chairman of Avnet’s board, said in a statement that the company was lucky to have someone of Amelio’s character and experience.

“He brings energy and focus to the business, and the board unanimously agreed that making him the permanent CEO was in the best interest of our customers, employees and shareholders.”

Amelio said that the company had an experienced management team and an engaged workforce.

“By better aligning those resources with our competitive solutions specialist, embedded and supply chain strengths, Avnet will undoubtedly be positioned to achieve profitable growth for our shareholders.”

Amelio told investors he is busy identifying and doubling down on the profit-generating sources within Avnet, and fixing or exiting from Avnet’s areas of poor profitability.

He will be rolling out new business management systems that emphasise accountability, address organisational barriers and allow the distributor to work more effectively through collective operating groups.

Amelio said he values Avnet’s Internet of Things and digital technologies initiatives, he is more interested in getting the outfit’s margin and return performance more in line with long-term financial goals.

Amelio will earn a prorated base salary of $850,000 annually and be eligible for a bonus of up to 100 percent of his base compensation, according to a July filing with the U.S. Securities and Exchange Commission. He also received an award of stock options and restricted stock units worth a total of $2 million.

 

Rackspace joins anti-Intel server group

IBM logoServer company Rackspace has joined an IBM inspired server group, snubbing its primary chip supplier, Intel.

The Openpower foundation was formed a year ago and has something like 80 worldwide members, working on producing server technology built using IBM rather than Intel microprocessor architecture.

The group already has members including Nvidia, Tyan and Google.

Rackspace has been working behind the scenes with the group for over 18 months, but openly declared its hand yesterday.  Senior director Aaron Sullivan said that Openpower has an open firmware stack, and better access to chips, memory and storage than, for example, Intel.

Other additions to the powerful consortium include Lawrence Livermore National Laboratory, the Mumbai Indian Institute of Technology, and worldwide distributor Avnet.

Openpower said its first summit will be held mid March at the San Jose Convention Center in California.

Avnet picks up Lenovo’s server business

avnettsMegadistributor Avnet said it has been appointed as a global Lenovo route to market.

This follows Lenovo’s acquisition of IBM’s System x (X86) server business early in the month.

Avnet said it will sell Lenovo servers in over 40 different countries around the world.

As well as Lenovo System x systems, Avnet will sell BladeCenter and Flex System blades and switches, X86 integrated system, NextScale and iDataplex servers, software and maintenance.

But this does not mean Avnet is waving goodbye to IBM. It’s worked with Big Blue for nearly 30 years and will continue to distribute IBM Power Systems, Storage Systems, Power Flex servers, training, software and services.

Tony Madden, a senior VP at Avnet Global said: “Avnet is working closely with Lenovo to ensure a seamless transition for existing System x channel partners and their customers.”

Avnet starts new unit

avnettsMega distie Avnet said it has set up a new business unit in the European, Middle East and Africa markets.

The dvision, called Avnet Security and Networking Solutions (ASNS), is intended to boost its share of this sector and will include the opening of specialist technical and commercial competence centres in the region.

Network security is predicted to be worth over $10 billion in revenues, according to market research firm IDC.

The first commercial competence centre will open in the Netherlands this quarter, and be a hub for delivering security and networking services.

Graeme Watt, president of Avnet in EMEA said his company will use existing people in the company to bring in external specialist skills to bolster the market.

Avnet promotes Murphy as UK head

Miriam Murphy, AvnetMiriam Murphy (pictured)  is to become a senor VP of Avnet’s northern region – that’s the UK and Ireland.

She replaces interim head of the territory Tony Madden, who has run the UK business over the last six months.

Murphy is a long time employee of Avnet and she was responsible for expanding its IBM business across 14 countries in the EMEA region, according to Graeme Watt, president of Avnet EMEA.

Murphy said the channel is changing but there are some opportunities for distribution and for partners in security, big data, analytics, conveged infrastructure and other services.

Avnet gets EMC gong

avgongMegadistributor Avnet Technology Solutions UK has been awarded a gong and named by EMC as its UK distributor of the year 2013.

Avnet gets the gong because it has promoted EMC’s “Attitude” programme – a scheme intended for small and medium sized businesses.

Channel director Terry Beale, from EMC, said that Avnet contributes a great deal to company sales.  Avnet partly gets the gong because it has made an easy to use portal for resellers that lets people configure and price EMC systems and improve its market share.

Avnet channel man Lee Bushnell said that his team drives demands and gives technical and commercial support on a range of EMC products.

Pictured here are, from left to right, Richard Graham, Clare Wright, Lee Bushnell, David Ross, and Warren Powell – all of them working for Avnet. The mask behind is presumably somebody from EMC.

Avnet in EMC push

Avnet's Lee BushnellDistributor Avnet said it has introduced a programme called Altitude aimed at small and medium sized businesses.

The programme promotes EMC storage and back up devices and aims to help its resellers offer VNXe storage and Data Domain backup products.

The scheme centres around an online configuration tool that lets resellers calculate price for the EMC products without needing to contact Avnet.  Using a secure portal, the configurator is available at all times.

Lee Bushnell, EMC business manager at Avnet UK (pictured), said that the programme will help resellers to secure lucrative revenue streams with attractive pricing.

Resellers can avail themselves of training on the portal along with sales information, data sheets and product training.

Avnet makes Benelux appointment

avnettsMarc van Ierland has been made country manager of its Benelux district which includes Luxembourg, Belgium and the Netherlands.

van Ierland has over 20 years experience in distribution and has been at Avnet since November 2007 after the company acquired ACAL.

Andrew Binding, VP at Avnet EMEA South said that he is a well known and respected individual  with a proven track record in developing and managing highly motivated teams.

He previously managed the IBM, Oracle, networking, security and document management business units in the region.

Avnet teams up with law firm

Frank Bennett, AvnetDistribution giant Avnet UK said it has partnered with international law firm Simmons and Simmons to hold a seminar on the impact of IT in the finance sector.

The aim of the event, dubbed FinancialPath University, is to educate its business partners about delivering IT to this sector.  The seminar, to be held on the 25th of February, will explor legal and regulatory matters that have an effect on IT decision making in the sector.

Avnet’s Frank Bennett, who heads up the initiative, said that the financial services industry is a huge opportunity for its business partners but is a complex industry to master.

After the seminar, delegates will be able to keep up to date with developments in the sector with a series of webinars.

Avnet teams with Veeam

avnettsAvnet Services said that it had become an accredited Veeam authorised education centre.

That will allow it to introduce a training programme in the UK, France, the Netherlands, Denmark, Italy and Spain.

The idea is to let its reseller partners become trained in Veeam software products. Veeam specialises in providing backup virtualisation management.

Rene Albert, director of education at Avnet Services EMEA said that the partnership will extend his company’s education portfolio just as the virtualisation market is showing increased growth.

And Daniel Fried, MD at Veeam said that the new training and certification programmes with let channel and end users take advantage of demand for data protection built for virtualisation.

Datacentre availability is big deal for channel

datacentrebatteriesA survey commissioned by Brocade has surveyed 350 global resellers and systems integrators and concludes that datacentre availability is the primary concern of customers.

The survey, carried out with the aid of Avnet, TD Azlan, TechData, Arrow ES, edsLAN, the Immix Group, Mindware and Westcon showed that 60 percent of end users see fabrics as the future of networks. But their unwillingness to invest in datacentre networks is a big hurdle for enterprises.

A third of the channel players surveyed said their customers only invested in networks to support a specific new application or service.  Over one in 10 said they only invested when the network was already failing.

The survey identified five drivers of network investment: virtualisation, faster access to data and applications, greater bandwidth, supporting increasing data volumes and the need to support mobility.

Sixty percent of the channel players think fabric networks will be deployed in datacentres by 2020.

However, a third admitted knowing little about SDN, while 62 percent think budget constraints have a significant impact on companies investing in technology.  And 63 percent consider vendor financing as “vital” or “more important”.

brocade_infographic

Avnet hires new man

van Es, AvnetMajor distie Avnet Technology Solutions EMEA said it has made a hire today.

Jeroen van Es is now country manager for Iberia, that is to say Spain and Portugal.

van Es formerly worked for Ingram Micro but with his Avnet hat on his task is to increase sales in Spain and Portugal.  He has a background of 19 years in the IT industry.

Andrew Binding, VP of Avnet Solutions South said that van Es had a proven track record developing and managing teams. “He’s known for building strong and trusting partnerships with both suppliers and customers,” he said.