EX-99.1 2 a51333514_ex991.htm EXHIBIT 99.1

Exhibit 99.1

Arrow Electronics Reports Record First-Quarter 2016 Sales and Non-GAAP Earnings Per Share

– First-Quarter 2016 Non-GAAP Earnings Per Share of $1.43 –
– Trailing 12-Month Cash Flow from Operations of $860 Million –

CENTENNIAL, Colo.--(BUSINESS WIRE)--May 3, 2016--Arrow Electronics, Inc. (NYSE:ARW) today reported first-quarter 2016 net income of $106.2 million, or $1.14 per share on a diluted basis, compared with net income of $106.1 million, or $1.09 per share on a diluted basis, in the first quarter of 2015. Excluding certain items1, net income would have been $132.2 million, or $1.43 per share on a diluted basis, in the first quarter of 2016, compared with net income of $127.8 million, or $1.32 per share on a diluted basis, in the first quarter of 2015. First-quarter sales of $5.47 billion increased 9 percent from sales of $5 billion in the prior year. First-quarter sales, adjusted for the impact of acquisitions and changes in foreign currencies, increased 4 percent year over year.

“We continued our strong momentum into 2016 by producing record first-quarter sales and earnings per share. Our global components and enterprise computing solutions businesses produced growth in all regions, delivering earnings per share of $1.43,” said Michael J. Long, chairman, president, and chief executive officer. “We attribute our strong performance to our strategic investments in customer-facing talent and resources, as well as our focus on design and value-added services for global components and our solution-selling approach for enterprise computing solutions.”

Global components first-quarter sales of $3.68 billion grew 10 percent year over year. First-quarter sales, as adjusted, grew 4 percent year over year. Americas components sales grew 3 percent year over year. Europe components sales grew 15 percent year over year. Sales in the region, as adjusted, grew 9 percent year over year. Asia-Pacific components sales grew 15 percent year over year. Sales in the region, as adjusted, grew 2 percent year over year. “Europe has delivered six straight quarters of strong growth, and Americas returned to growth as we anticipated. In Asia, growth by our core small-to-medium-sized manufacturing customers was better than we anticipated,” added Mr. Long.

Global enterprise computing solutions first-quarter sales of $1.8 billion grew 9 percent year over year. First-quarter sales, as adjusted, grew 3 percent year over year. Americas sales grew 11 percent year over year. Sales in the region, as adjusted, grew 2 percent year over year. Europe sales grew 4 percent year over year. Sales in the region, as adjusted, grew 6 percent year over year. “Enterprise computing solutions posted record first-quarter sales, operating income, and operating margin,” said Mr. Long.

“First-quarter cash flow from operations was a negative $37 million. While seasonally negative, we showed substantial improvement when compared to the past three years. Trailing 12-month cash flow from operations was $860 million,” said Paul J. Reilly, executive vice president, finance and operations, and chief financial officer. “Our strong balance sheet and cash flow allowed us to continue investing in organic growth, and provided us with the opportunity to deploy capital toward our strategic initiatives. We will continue to return excess capital to shareholders.”

1 A reconciliation of non-GAAP adjusted financial measures, including sales, as adjusted, operating income, as adjusted, net income attributable to shareholders, as adjusted, and net income per share, as adjusted, to GAAP financial measures is presented in the reconciliation tables included herein.

GUIDANCE

“As we look to the second quarter, we believe that total sales will be between $5.825 billion and $6.225 billion, with global components sales between $3.75 billion and $3.95 billion, and global enterprise computing solutions sales between $2.075 billion and $2.275 billion. As a result of this outlook, we expect earnings per share on a diluted basis, excluding any charges, to be in the range of $1.59 to $1.71 per share. Our guidance assumes an average tax rate in the range of 27 to 29 percent and average diluted shares outstanding are expected to be 93 million. We are expecting the average USD-to-Euro exchange rate for the first quarter to be approximately $1.13 to €1,” said Mr. Reilly.

Please refer to the CFO commentary, which can be found at investor.arrow.com, as a supplement to the company’s earnings release.

Arrow Electronics (www.arrow.com) is a global provider of products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions. Arrow serves as a supply channel partner for more than 100,000 original equipment manufacturers, contract manufacturers, and commercial customers through a global network of more than 460 locations serving over 85 countries.

Information Relating to Forward-Looking Statements

This press release includes forward-looking statements that are subject to numerous assumptions, risks, and uncertainties, which could cause actual results or facts to differ materially from such statements for a variety of reasons, including, but not limited to: industry conditions, the company's implementation of its new enterprise resource planning system, changes in product supply, pricing and customer demand, competition, other vagaries in the global components and global enterprise computing solutions markets, changes in relationships with key suppliers, increased profit margin pressure, the effects of additional actions taken to become more efficient or lower costs, risks related to the integration of acquired businesses, changes in legal and regulatory matters, and the company’s ability to generate additional cash flow. Forward-looking statements are those statements which are not statements of historical fact. These forward-looking statements can be identified by forward-looking words such as "expects," "anticipates," "intends," "plans," "may," "will," "believes," "seeks," "estimates," and similar expressions. Shareholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they are made. The company undertakes no obligation to update publicly or revise any of the forward-looking statements.

For a further discussion of factors to consider in connection with these forward-looking statements, investors should refer to Item 1A Risk Factors of the company’s Annual Report on Form 10-K for the year ended December 31, 2015.

Certain Non-GAAP Financial Information

In addition to disclosing financial results that are determined in accordance with accounting principles generally accepted in the United States (“GAAP”), the company also provides certain non-GAAP financial information relating to sales, operating income, net income attributable to shareholders, and net income per basic and diluted share. The company provides sales on a non-GAAP basis adjusted for the impact of changes in foreign currencies and the impact of acquisitions by adjusting the company's operating results for businesses acquired, including the amortization expense related to acquired intangible assets, as if the acquisitions had occurred at the beginning of the earliest period presented (referred to as "impact of acquisitions"). Operating income, net income attributable to shareholders, and net income per basic and diluted share are adjusted for certain charges, credits, gains, and losses that the company believes impact the comparability of its results of operations. These charges, credits, gains, and losses arise out of the company’s efficiency enhancement initiatives, acquisitions (including intangible assets amortization expense), loss on prepayment of debt, and (gain)/loss on investments. A reconciliation of the company’s non-GAAP financial information to GAAP is set forth in the tables below.

The company believes that such non-GAAP financial information is useful to investors to assist in assessing and understanding the company’s operating performance and underlying trends in the company’s business because management considers these items referred to above to be outside the company’s core operating results. This non-GAAP financial information is among the primary indicators management uses as a basis for evaluating the company’s financial and operating performance. In addition, the company’s Board of Directors may use this non-GAAP financial information in evaluating management performance and setting management compensation.

The presentation of this additional non-GAAP financial information is not meant to be considered in isolation or as a substitute for, or alternative to, sales, operating income, net income, and net income per basic and diluted share determined in accordance with GAAP. Analysis of results and outlook on a non-GAAP basis should be used as a complement to, and in conjunction with, data presented in accordance with GAAP.

ARROW ELECTRONICS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share data) (Unaudited)
|  |  |  |  |  |  |  |  | Quarter Ended
|  |  |  |  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015
Sales |  |  |  |  |  |  |  |  | $ | 5,474,177 |  |  |  |  |  | $ | 5,002,385
Costs and expenses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cost of sales |  |  |  |  |  |  |  |  |  | 4,725,279 |  |  |  |  |  |  | 4,317,063
Selling, general, and administrative expenses |  |  |  |  |  |  |  |  |  | 505,813 |  |  |  |  |  |  | 454,530
Depreciation and amortization |  |  |  |  |  |  |  |  |  | 40,933 |  |  |  |  |  |  | 37,162
Restructuring, integration, and other charges |  |  |  |  |  |  |  |  |  | 20,788 |  |  |  |  |  |  | 16,196
|  |  |  |  |  |  |  |  |  | 5,292,813 |  |  |  |  |  |  | 4,824,951
Operating income |  |  |  |  |  |  |  |  |  | 181,364 |  |  |  |  |  |  | 177,434
Equity in earnings of affiliated companies |  |  |  |  |  |  |  |  |  | 1,856 |  |  |  |  |  |  | 1,313
Interest and other financing expense, net |  |  |  |  |  |  |  |  |  | 35,575 |  |  |  |  |  |  | 30,854
Other expense, net |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | 935
Income before income taxes |  |  |  |  |  |  |  |  |  | 147,645 |  |  |  |  |  |  | 146,958
Provision for income taxes |  |  |  |  |  |  |  |  |  | 41,053 |  |  |  |  |  |  | 40,867
Consolidated net income |  |  |  |  |  |  |  |  |  | 106,592 |  |  |  |  |  |  | 106,091
Noncontrolling interests |  |  |  |  |  |  |  |  |  | 357 |  |  |  |  |  |  | 33
Net income attributable to shareholders |  |  |  |  |  |  |  |  | $ | 106,235 |  |  |  |  |  | $ | 106,058
Net income per share: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  |  |  |  |  |  |  | $ | 1.16 |  |  |  |  |  | $ | 1.11
Diluted |  |  |  |  |  |  |  |  | $ | 1.14 |  |  |  |  |  | $ | 1.09
Weighted-average shares outstanding: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Basic |  |  |  |  |  |  |  |  |  | 91,514 |  |  |  |  |  |  | 95,920
Diluted |  |  |  |  |  |  |  |  |  | 92,787 |  |  |  |  |  |  | 97,125

ARROW ELECTRONICS, INC. CONSOLIDATED BALANCE SHEETS (In thousands except par value)
|  |  |  |  |  |  |  |  | April 2, |  |  |  |  |  | December 31,
|  |  |  |  |  |  |  |  | 2016 |  |  |  |  |  | 2015
ASSETS |  |  |  |  |  |  |  |  | (unaudited) |  |  |  |  |  |
Current assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  |  |  |  |  |  |  |  | $ | 394,655 |  |  |  |  |  |  | $ | 273,090 |
Accounts receivable, net |  |  |  |  |  |  |  |  |  | 5,256,022 |  |  |  |  |  |  |  | 6,161,418 |
Inventories |  |  |  |  |  |  |  |  |  | 2,441,798 |  |  |  |  |  |  |  | 2,466,490 |
Other current assets |  |  |  |  |  |  |  |  |  | 335,095 |  |  |  |  |  |  |  | 285,473 |
Total current assets |  |  |  |  |  |  |  |  |  | 8,427,570 |  |  |  |  |  |  |  | 9,186,471 |
Property, plant, and equipment, at cost: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Land |  |  |  |  |  |  |  |  |  | 23,630 |  |  |  |  |  |  |  | 23,547 |
Buildings and improvements |  |  |  |  |  |  |  |  |  | 167,558 |  |  |  |  |  |  |  | 162,011 |
Machinery and equipment |  |  |  |  |  |  |  |  |  | 1,296,817 |  |  |  |  |  |  |  | 1,250,115 |
|  |  |  |  |  |  |  |  |  | 1,488,005 |  |  |  |  |  |  |  | 1,435,673 |
Less: Accumulated depreciation and amortization |  |  |  |  |  |  |  |  |  | (762,685 | ) |  |  |  |  |  |  | (735,495 | )
Property, plant, and equipment, net |  |  |  |  |  |  |  |  |  | 725,320 |  |  |  |  |  |  |  | 700,178 |
Investments in affiliated companies |  |  |  |  |  |  |  |  |  | 74,553 |  |  |  |  |  |  |  | 73,376 |
Intangible assets, net |  |  |  |  |  |  |  |  |  | 383,503 |  |  |  |  |  |  |  | 389,326 |
Cost in excess of net assets of companies acquired |  |  |  |  |  |  |  |  |  | 2,437,034 |  |  |  |  |  |  |  | 2,368,832 |
Other assets |  |  |  |  |  |  |  |  |  | 304,807 |  |  |  |  |  |  |  | 303,747 |
Total assets |  |  |  |  |  |  |  |  | $ | 12,352,787 |  |  |  |  |  |  | $ | 13,021,930 |
LIABILITIES AND EQUITY |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Current liabilities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounts payable |  |  |  |  |  |  |  |  | $ | 4,206,658 |  |  |  |  |  |  | $ | 5,192,665 |
Accrued expenses |  |  |  |  |  |  |  |  |  | 668,002 |  |  |  |  |  |  |  | 819,463 |
Short-term borrowings, including current portion of long-term debt |  |  |  |  |  |  |  |  |  | 46,143 |  |  |  |  |  |  |  | 44,024 |
Total current liabilities |  |  |  |  |  |  |  |  |  | 4,920,803 |  |  |  |  |  |  |  | 6,056,152 |
Long-term debt |  |  |  |  |  |  |  |  |  | 2,649,042 |  |  |  |  |  |  |  | 2,380,575 |
Other liabilities |  |  |  |  |  |  |  |  |  | 408,829 |  |  |  |  |  |  |  | 390,392 |
Equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Shareholders' equity: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Common stock, par value $1: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Authorized – 160,000 shares in both 2016 and 2015 |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Issued – 125,424 shares in both 2016 and 2015 |  |  |  |  |  |  |  |  |  | 125,424 |  |  |  |  |  |  |  | 125,424 |
Capital in excess of par value |  |  |  |  |  |  |  |  |  | 1,082,103 |  |  |  |  |  |  |  | 1,107,314 |
Treasury stock (33,801 and 34,501 shares in 2016 and 2015, respectively), at cost |  |  |  |  |  |  |  |  |  | (1,454,687 | ) |  |  |  |  |  |  | (1,480,069 | )
Retained earnings |  |  |  |  |  |  |  |  |  | 4,780,715 |  |  |  |  |  |  |  | 4,674,480 |
Accumulated other comprehensive loss |  |  |  |  |  |  |  |  |  | (214,175 | ) |  |  |  |  |  |  | (284,706 | )
Total shareholders' equity |  |  |  |  |  |  |  |  |  | 4,319,380 |  |  |  |  |  |  |  | 4,142,443 |
Noncontrolling interests |  |  |  |  |  |  |  |  |  | 54,733 |  |  |  |  |  |  |  | 52,368 |
Total equity |  |  |  |  |  |  |  |  |  | 4,374,113 |  |  |  |  |  |  |  | 4,194,811 |
Total liabilities and equity |  |  |  |  |  |  |  |  | $ | 12,352,787 |  |  |  |  |  |  | $ | 13,021,930 |

ARROW ELECTRONICS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) (Unaudited)
|  |  |  |  |  |  |  |  | Quarter Ended
|  |  |  |  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015
Cash flows from operating activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Consolidated net income |  |  |  |  |  |  |  |  | $ | 106,592 |  |  |  |  |  |  | $ | 106,091 |
Adjustments to reconcile consolidated net income to net cash used for operations: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation and amortization |  |  |  |  |  |  |  |  |  | 40,933 |  |  |  |  |  |  |  | 37,162 |
Amortization of stock-based compensation |  |  |  |  |  |  |  |  |  | 8,877 |  |  |  |  |  |  |  | 9,920 |
Equity in earnings of affiliated companies |  |  |  |  |  |  |  |  |  | (1,856 | ) |  |  |  |  |  |  | (1,313 | )
Deferred income taxes |  |  |  |  |  |  |  |  |  | 22,555 |  |  |  |  |  |  |  | 12,391 |
Excess tax benefits from stock-based compensation arrangements |  |  |  |  |  |  |  |  |  | (4,132 | ) |  |  |  |  |  |  | (5,657 | )
Other |  |  |  |  |  |  |  |  |  | 1,462 |  |  |  |  |  |  |  | 1,730 |
Change in assets and liabilities, net of effects of acquired businesses: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Accounts receivable |  |  |  |  |  |  |  |  |  | 996,738 |  |  |  |  |  |  |  | 935,271 |
Inventories |  |  |  |  |  |  |  |  |  | 44,611 |  |  |  |  |  |  |  | 48,574 |
Accounts payable |  |  |  |  |  |  |  |  |  | (1,036,094 | ) |  |  |  |  |  |  | (1,279,437 | )
Accrued expenses |  |  |  |  |  |  |  |  |  | (160,693 | ) |  |  |  |  |  |  | (109,156 | )
Other assets and liabilities |  |  |  |  |  |  |  |  |  | (55,585 | ) |  |  |  |  |  |  | 2,828 |
Net cash used for operating activities |  |  |  |  |  |  |  |  |  | (36,592 | ) |  |  |  |  |  |  | (241,596 | )
Cash flows from investing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Cash consideration paid for acquired businesses |  |  |  |  |  |  |  |  |  | (46,490 | ) |  |  |  |  |  |  | (133,089 | )
Acquisition of property, plant, and equipment |  |  |  |  |  |  |  |  |  | (49,261 | ) |  |  |  |  |  |  | (31,150 | )
Other |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  |  | 2,008 |
Net cash used for investing activities |  |  |  |  |  |  |  |  |  | (95,751 | ) |  |  |  |  |  |  | (162,231 | )
Cash flows from financing activities: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Change in short-term and other borrowings |  |  |  |  |  |  |  |  |  | 470 |  |  |  |  |  |  |  | 1,234 |
Proceeds from (repayments of)long-term bank borrowings, net |  |  |  |  |  |  |  |  |  | 265,000 |  |  |  |  |  |  |  | (48,400 | )
Net proceeds from note offering |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  |  | 688,162 |
Redemption of notes |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  |  | (254,313 | )
Proceeds from exercise of stock options |  |  |  |  |  |  |  |  |  | 5,705 |  |  |  |  |  |  |  | 12,576 |
Excess tax benefits from stock-based compensation arrangements |  |  |  |  |  |  |  |  |  | 4,132 |  |  |  |  |  |  |  | 5,657 |
Repurchases of common stock |  |  |  |  |  |  |  |  |  | (18,684 | ) |  |  |  |  |  |  | (78,561 | )
Other |  |  |  |  |  |  |  |  |  | (3,000 | ) |  |  |  |  |  |  | (3,000 | )
Net cash provided by financing activities |  |  |  |  |  |  |  |  |  | 253,623 |  |  |  |  |  |  |  | 323,355 |
Effect of exchange rate changes on cash |  |  |  |  |  |  |  |  |  | 285 |  |  |  |  |  |  |  | (14,590 | )
Net increase (decrease) in cash and cash equivalents |  |  |  |  |  |  |  |  |  | 121,565 |  |  |  |  |  |  |  | (95,062 | )
Cash and cash equivalents at beginning of period |  |  |  |  |  |  |  |  |  | 273,090 |  |  |  |  |  |  |  | 400,355 |
Cash and cash equivalents at end of period |  |  |  |  |  |  |  |  | $ | 394,655 |  |  |  |  |  |  | $ | 305,293 |

ARROW ELECTRONICS, INC. NON-GAAP SALES RECONCILIATION (In thousands) (Unaudited)
|  |  |  |  |  | Quarter Ended |  |  |  |
|  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015 |  |  |  | % Change
Consolidated sales, as reported |  |  |  |  |  | $ | 5,474,177 |  |  |  |  |  | $ | 5,002,385 |  |  |  |  | 9.4 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (63,227 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | 38,437 |  |  |  |  |  |  | 368,154 |  |  |  |  |
Consolidated sales, as adjusted |  |  |  |  |  | $ | 5,512,614 |  |  |  |  |  | $ | 5,307,312 |  |  |  |  | 3.9 | %
Global components sales, as reported |  |  |  |  |  | $ | 3,675,929 |  |  |  |  |  | $ | 3,346,763 |  |  |  |  | 9.8 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (42,016 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | - |  |  |  |  |  |  | 217,406 |  |  |  |  |
Global components sales, as adjusted |  |  |  |  |  | $ | 3,675,929 |  |  |  |  |  | $ | 3,522,153 |  |  |  |  | 4.4 | %
Europe components sales, as reported |  |  |  |  |  | $ | 1,058,432 |  |  |  |  |  | $ | 923,261 |  |  |  |  | 14.6 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (24,299 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | - |  |  |  |  |  |  | 74,083 |  |  |  |  |
Europe components sales, as adjusted |  |  |  |  |  | $ | 1,058,432 |  |  |  |  |  | $ | 973,045 |  |  |  |  | 8.8 | %
Asia components sales, as reported |  |  |  |  |  | $ | 1,177,868 |  |  |  |  |  | $ | 1,025,914 |  |  |  |  | 14.8 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (13,859 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | - |  |  |  |  |  |  | 139,977 |  |  |  |  |
Asia components sales, as adjusted |  |  |  |  |  | $ | 1,177,868 |  |  |  |  |  | $ | 1,152,032 |  |  |  |  | 2.2 | %
Global ECS sales, as reported |  |  |  |  |  | $ | 1,798,248 |  |  |  |  |  | $ | 1,655,622 |  |  |  |  | 8.6 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (21,211 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | 38,437 |  |  |  |  |  |  | 150,749 |  |  |  |  |
Global ECS sales, as adjusted |  |  |  |  |  | $ | 1,836,685 |  |  |  |  |  | $ | 1,785,160 |  |  |  |  | 2.9 | %
Europe ECS sales, as reported |  |  |  |  |  | $ | 607,448 |  |  |  |  |  | $ | 581,662 |  |  |  |  | 4.4 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (7,499 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | - |  |  |  |  |  |  | - |  |  |  |  |
Europe ECS sales, as adjusted |  |  |  |  |  | $ | 607,448 |  |  |  |  |  | $ | 574,163 |  |  |  |  | 5.8 | %
Americas ECS sales, as reported |  |  |  |  |  | $ | 1,190,800 |  |  |  |  |  | $ | 1,073,960 |  |  |  |  | 10.9 | %
Impact of changes in foreign currencies |  |  |  |  |  |  | - |  |  |  |  |  |  | (13,712 | ) |  |  |  |
Impact of acquisitions |  |  |  |  |  |  | 38,437 |  |  |  |  |  |  | 150,749 |  |  |  |  |
Americas ECS sales, as adjusted |  |  |  |  |  | $ | 1,229,237 |  |  |  |  |  | $ | 1,210,997 |  |  |  |  | 1.5 | %

ARROW ELECTRONICS, INC.
NON-GAAP EARNINGS RECONCILIATION
(In thousands except per share data)
(Unaudited)
|  |  |  |  |  |  |  |  | Quarter Ended
|  |  |  |  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015
Operating income, as reported |  |  |  |  |  |  |  |  | $ | 181,364 |  |  |  |  |  | $ | 177,434 |
Intangible assets amortization expense |  |  |  |  |  |  |  |  |  | 12,913 |  |  |  |  |  |  | 11,107 |
Restructuring, integration, and other charges |  |  |  |  |  |  |  |  |  | 20,788 |  |  |  |  |  |  | 16,196 |
Operating income, as adjusted |  |  |  |  |  |  |  |  | $ | 215,065 |  |  |  |  |  | $ | 204,737 |
Net income attributable to shareholders, as reported |  |  |  |  |  |  |  |  | $ | 106,235 |  |  |  |  |  | $ | 106,058 |
Intangible assets amortization expense |  |  |  |  |  |  |  |  |  | 10,634 |  |  |  |  |  |  | 9,029 |
Restructuring, integration, and other charges |  |  |  |  |  |  |  |  |  | 15,354 |  |  |  |  |  |  | 12,569 |
Loss on prepayment of debt |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | 1,808 |
Gain on investments |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | (1,667 | )
Net income attributable to shareholders, as adjusted |  |  |  |  |  |  |  |  | $ | 132,223 |  |  |  |  |  | $ | 127,797 |
Net income per basic share, as reported |  |  |  |  |  |  |  |  | $ | 1.16 |  |  |  |  |  | $ | 1.11 |
Intangible assets amortization expense |  |  |  |  |  |  |  |  |  | .12 |  |  |  |  |  |  | .09 |
Restructuring, integration, and other charges |  |  |  |  |  |  |  |  |  | .17 |  |  |  |  |  |  | .13 |
Loss on prepayment of debt |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | .02 |
Gain on investments |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | (.02 | )
Net income per basic share, as adjusted |  |  |  |  |  |  |  |  | $ | 1.44 |  |  |  |  |  | $ | 1.33 |
Net income per diluted share, as reported |  |  |  |  |  |  |  |  | $ | 1.14 |  |  |  |  |  | $ | 1.09 |
Intangible assets amortization expense |  |  |  |  |  |  |  |  |  | .11 |  |  |  |  |  |  | .09 |
Restructuring, integration, and other charges |  |  |  |  |  |  |  |  |  | .17 |  |  |  |  |  |  | .13 |
Trade name impairment charge |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | .02 |
Gain on investments |  |  |  |  |  |  |  |  |  | - |  |  |  |  |  |  | (.02 | )
Net income per diluted share, as adjusted |  |  |  |  |  |  |  |  | $ | 1.43 |  |  |  |  |  | $ | 1.32 |

The sum of the components for basic and diluted net income per share, as adjusted, may not agree to totals, as presented, due to rounding.

ARROW ELECTRONICS, INC. SEGMENT INFORMATION (In thousands) (Unaudited)
|  |  |  |  |  |  |  |  | Quarter Ended
|  |  |  |  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015
Sales: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Global components |  |  |  |  |  |  |  |  | $ | 3,675,929 |  |  |  |  |  |  | $ | 3,346,763 |
Global ECS |  |  |  |  |  |  |  |  |  | 1,798,248 |  |  |  |  |  |  |  | 1,655,622 |
Consolidated |  |  |  |  |  |  |  |  | $ | 5,474,177 |  |  |  |  |  |  | $ | 5,002,385 |
Operating income (loss): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Global components |  |  |  |  |  |  |  |  | $ | 170,770 |  |  |  |  |  |  | $ | 164,895 |
Global ECS |  |  |  |  |  |  |  |  |  | 78,212 |  |  |  |  |  |  |  | 67,517 |
Corporate (a) |  |  |  |  |  |  |  |  |  | (67,618 | ) |  |  |  |  |  |  | (54,978 | )
Consolidated |  |  |  |  |  |  |  |  | $ | 181,364 |  |  |  |  |  |  | $ | 177,434 |

(a) |  |  | Includes restructuring, integration, and other charges of $20.8 million and $16.2 million for the first quarters of 2016 and 2015, respectively.

NON-GAAP SEGMENT RECONCILIATION
|  |  |  |  |  |  |  | Quarter Ended
|  |  |  |  |  |  |  | April 2, 2016 |  |  |  |  |  | March 28, 2015
Global components operating income, as reported |  |  |  |  |  |  |  | $ | 170,770 |  |  |  |  |  | $ | 164,895
Intangible assets amortization expense |  |  |  |  |  |  |  |  | 7,900 |  |  |  |  |  |  | 5,782
Global components operating income, as adjusted |  |  |  |  |  |  |  | $ | 178,670 |  |  |  |  |  | $ | 170,677
Global ECS operating income, as reported |  |  |  |  |  |  |  | $ | 78,212 |  |  |  |  |  | $ | 67,517
Intangible assets amortization expense |  |  |  |  |  |  |  |  | 5,013 |  |  |  |  |  |  | 5,325
Global ECS operating income, as adjusted |  |  |  |  |  |  |  | $ | 83,225 |  |  |  |  |  | $ | 72,842

CONTACT:
Arrow Electronics, Inc.
Steven O’Brien
Director, Investor Relations
303-824-4544
or
Paul J. Reilly
Executive Vice President, Finance and Operations, and
Chief Financial Officer
631-847-1872
or
Media Contact:
John Hourigan
Vice President, Global Communications
303-824-4586