Anixter Q3 Sales Grow On Acquisition While Profit Declines

Anixter's completed acquisition of Tri-Ed boosted its Enterprising Cabling & Security Solutions sales to a record amount, but declines in Wire & Cable sales dragged down the company's bottom line.

Glenview, Illinois-based Anixter – No. 7 on Industrial Distribution's Big 50 List – reported its 2015 third quarter financial earnings on Tuesday for the period ended Oct. 2.

The company posted Q3 sales of $1.49 billion, up 3.6 percent from last year. Anixter said that adjusting for the favorable impact from Anixter's Q3 acquisition of Tri-Ed and the unfavorable impacts of currency headwinds and copper prices, organic sales increased 0.7 percent.

Anixter's Q3 profit was $32.5 million, down 38 percent from last year's $52.5 million, but up from Q2's $29.5 million.

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Anixter's Enterprising Cabling & Security Solutions (ECS) Q3 sales were a record $1.035 billion, up 14.5 percent over last year. The large increase was driven by higher security sales resulting from the Tri-Ed acquisition and strength in Anixter's emerging markets and EMEA regions. ECS organic sales increased by 4.0 percent. ESC security sales (39 percent of total ECS) sales, increased by 40 percent over last year to $402.4 million. Organic sales were flat.

ECS organic sales increased by a strong 4.0 percent, adjusting for the $39.0 million unfavorable impact from foreign exchange on current year sales and the $128.9 million favorable impact from the Tri-Ed acquisition.

Anixter's Electrical and Electronic Wire & Cable (W&C) sales in Q3 were $453.8 million, down 15.0 percent from last year, with organic sales down 5.8 percent.

"Our W&C segment continued to experience weaker trends, reflecting lower copper prices as well as exposure to energy and weaker industrial projects." said Bob Eck, Anixter CEO. 

“Strong growth in our ECS business, offset by the impacts of lower average copper prices and the stronger US dollar contributed to the third consecutive quarter in which we have delivered solid results in a challenging macro economic environment," added Ted Dosch, Anixter Executive Vice President - Finance and CFO. "

Eck said Anixter expects full year organic sales growth of between 1.5-2.5 percent.