a technology solutions and business services company · 1/13/2016 · (7) idc, worldwide and u.s....

A Technology Solutions and

Business Services Company

18th Annual Needham Growth Conference

January 13, 2016

Safe Harbor StatementStatements in this presentation regarding SYNNEX Corporation which are not historical facts may be

forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section

21E of the Securities Exchange Act of 1934. These forward-looking statements may be identified by terms

such as believe, expect, may, will, provide, could and should and the negative of these terms or other

similar expressions. These forward-looking statements include, but are not limited to, statements regarding

our business strategy, our investments, our growth and positioning for profitable growth, shareholder

value, cash generation and capital allocation, our use of capital, margins, profitability and returns,

expectations of our revenues, market share, technology trends and IT market growth, IoT spending,

growth in servers, storage and switches, BPO market growth, CRM BPO market consolidation

opportunities, business expansion opportunities, our performance, our competitive position, our

expectations for our operating margins, market conditions, our product and service features and

capabilities, revenue growth FY15 through FY17, sustainable margin expansion in FY15 through FY17,our

target revenue growth range FY15 through FY17, our target adjusted operating margin FY15 through

FY17, and our financial goals.

These are subject to risks and uncertainties that could cause actual results to differ materially from those

discussed in the forward-looking statements. Please refer to the documents filed with the Securities and

Exchange Commission, specifically our most recent Form 10-K and 10-Q, for information on risk factors

that could cause actual results to differ materially from those discussed in these forward looking

statements. Statements included in this presentation are based upon information known to SYNNEX

Corporation as of the date of presentation and SYNNEX Corporation assumes no obligation to update

information contained in this presentation.

SYNNEX Overview

Helping our Business Partners Achieve Success through

Alignment of our Joint Strategies and Capabilities

Differentiating Clients and Improving Business Outcomes through Customer Engagement, Maximized Customer Ecosystems, Innovative Technology, Advanced Analytics and Process Optimization

Bringing the Most Relevant Technology

Solutions to the

IT and CE Markets to Help our Partners

Sustainably Grow

their Businesses

SYNNEX Mission

CUSTOMER FOCUS

FINANCIAL FOCUS

We Always Have the Best Interest of our Customers in Mind in Everything We Do

We Create Shareholder Value through Strong Execution, Smart Investments and Effective Use of Capital

We Continue to Invest in our Capabilities to Bring the Best Resources and Solutions to our Partners

We Provide a Culture that Inspires Innovation and Empowerment in our Associates to Achieve our Common Goals

Helping our Business Partners Achieve Success through Alignment of our Joint Strategies and Capabilities

PEOPLE FOCUS

v v vVALUEVELOCITYVISIBILTY

SYNNEX Guiding Principles

Lets us Quickly Adapt to, even Anticipate,

Change in the Market Place and your

Businesses

To our Associates, Clients, Vendors, and

Shareholders is Considered and Upheld

in All that We Do

Throughout the Organization Allows

us to Quickly See and Address Problems and

Opportunities

We Create Value for all our ConstituentsWe are Committed to Deliver the Finest Products and Services in the Industry

We Treasure Loyalty, Teamwork, Integrity and Hard Work

• A new Paradigm for scale

computing, with purpose-

built, large scale data center

solutions

• Factories in the US and UK

The World’s Largest Data

Center Customers

• Public Cloud, Social

Networking, Media, Finance

and Entertainment

Design and Deliver Custom,

Purpose-Built Servers,

Storage, Switches

• Efficient Design, Large Scale

and Worldwide Deployment

• Focused Footprint in the US, Canada and Japan

• Represent over 300 of the World’s Leading IT and CE Manufacturers

• 20,000+ Reseller and Retail Customers

Efficient Deployment of

Technology and CE Products

and Services through Volume

and Value-Add Distribution

HyveSolutions

• 70,000+ Associates Worldwide

• 25 Countries

• 40+ Languages

• 300+ Clients

Priority Verticals: Healthcare and Pharmaceuticals, Banking and Financial Services, Insurance, and Consumer Electronics and Technology

Deliver High-Value Business

Services and Solutions for the

Customer Relationship

Lifecycle

What We Look Like

SYNNEX Today

All End Markets, including Public

Sector, Corporate & Enterprise,

SMB and Consumer through

Value Added Resellers and

Retailers

IT Distribution

Markets We Serve

What We Do

2015 Contribution from Business Segments

Concentrix$1.4B

Revenue Adjusted Operating Income (1)

Technology Solutions

$11.9B Concentrix $113M

TechologySolutions

$306M

(1) Non-GAAP Measure. See the Definition and GAAP to Non-

GAAP Section of this Presentation for Definitions of Non-

GAAP Measures and the Reconciliation of Such Measures to

GAAP.

Shifting Mix to Higher Margin, Value-Added Business Through Targeted Organic Growth and Investments

Revenue Growth ($M) Adjusted Operating Margin(1)

(1) Non-GAAP Measure. See the Definition and GAAP to Non-GAAP Section of

this Presentation for Definitions of Non-GAAP Measures and the

Reconciliation of Such Measures to GAAP.

$10,845

$13,840 $13,338

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

2013 2014 2015

2.37%

2.94%3.14%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

2013 2014 2015

Technology Solutions - Higher Margin Investments Combined with Strong Base Growth Key Drivers to Revenue and Margin Expansion


(1) Non-GAAP Measure. See the Definition and GAAP to Non-GAAP Section of this

Presentation for Definitions of Non-GAAP Measures and the Reconciliation of Such

Measures to GAAP.

$10,666

$12,756

$11,937

9,500

10,000

10,500

11,000

11,500

12,000

12,500

13,000

2013 2014 2015

2.26%

2.42%

2.56%

2.10%

2.15%

2.20%

2.25%

2.30%

2.35%

2.40%

2.45%

2.50%

2.55%

2.60%

2013 2014 2015

Concentrix - Growing Faster than Market Reflecting the Strength of our Value-Added Offerings within Key Growth Vertical Industries


(1) Non-GAAP Measure. See the Definition and GAAP to Non-GAAP Section of this

Presentation for Definitions of Non-GAAP Measures and the Reconciliation of Such

Measures to GAAP.

2014 and 2015 data presented in this slide are after IBM CRM acquisition.

$189

$1,096

$1,417

0

200

400

600

800

1,000

1,200

1,400

1,600

2013 2014 2015

8.28%

8.86%

8.00%

2.50%

3.50%

4.50%

5.50%

6.50%

7.50%

8.50%

9.50%

2013 2014 2015

Consolidated Adjusted EBITDA Growing at a Faster Rate than Revenues

Adjusted EBITDA (1) ($Millions)

(1) Non-GAAP Measure. See the Definition and GAAP to Non-GAAP Section of this Presentation for Definitions of Non-GAAP Measures and the Reconciliation of Such Measures to GAAP.

$274

$444$468

$0

$50

$100

$150

$200

$250

$300

$350

$400

$450

$500

2013 2014 2015

(1)Refer to appendix for calculation.(2)Total liquidity is calculated as the sum of our cash and cash equivalents, short-term

investment and the unused portion of available borrowing facilities, including any accordion features.

(3)Approximate dollar value of shares remaining to be purchased under the program.

WE ARE WELL POSITIONED FOR PROFITABLE GROWTH

Strong Balance Sheet and Cash Flow Generation Creates Financial Flexibility

Fiscal 2015

Cash & Cash Equivalents $430M

Working Capital Velocity(1)

8X

Total Liquidity(2)

$1.7B

Operating Cash Flow $659M

Total Borrowings $731M

Debt to Captalization(1)

29%

Dividend Yield (Annualized)(1)

0.61%

3-Year $100 million Share Repurchase Program $91M(3)

SYNNEX Technology

Solutions

2015-2018:

• US 2.9% CAGR

• Canada 3.7% CAGR

• Japan 1.1% CAGR

Technology is a Growing Market

IDC, Black Book, April 2015

2015 - 2018 Forecasted WW IT CAGR of 3.2%

IT Growth Forecast in SYNNEX Markets

-

500

1,000

1,500

2,000

2,500

2014 2015 2016 2017 2018IT Services Packaged Software Server SystemsClient Systems Storage PeripheralsTelecom

679 704 727 748 766

53 56 58 60 62148 147 148 151 152

0

200

400

600

800

1,000

1,200

2014 2015 2016 2017 2018

JapanCanadaUS

• Traditional IT Remains Large and Stable

• But Growth is Driven by Third Platform Technologies

All Data in $B

All Data in $B

Distribution – A Hybrid Volume/Value-Add Model

HYBRIDNiche – Targeted Markets

Partner Enablement

Broadline

Corporate/Enterprise

VALUE-ADDDesign Services

Assembly & Test

Professional Services

$$$

VOLUMESupply Chain Efficiencies

Tech Support

Inventory Management

Financing Program

$

End-UsersCustomers

Retail

System Integrator

DMR

Corporate VAR

VAR

PUBLIC

SECTOR

SMB

CORPORATE /

ENTERPRISE

CONSUMER

Solving Problems through Technology Solutions

Operational

Capabilities

Professional

Services and

Proprietary

Platforms

Go-to-Market

Services Volume

and Value-

Added

Distribution

Services

Cloud Computing

Everything-as-a-Service

Infrastructure & Business Continuity

Security


PaaS SaaSIaaS

Big Data

Data Warehousing


Business Intelligence

Predictive and Applied Analytics

Data Center Infrastructure

Consumer Technology

Home Automation

Wearables

Home Healthcare

Entertainment

Connecting the Dots:SYNNEX Invests in Growth Technologies

Personal Devices

M2M

Connectivity

Solutions

Security

Device

Management

EnterpriseMobility

Internet of Things Driving Growth

IoT spending in 2015 will exceed $1.7 trillion, a 14% jump from 2014, driven by nearly 15 billion devices. By 2020, this will rise to $3 trillion and nearly 30 billion devices. Source: IDC –IDC Predictions 2015: Accelerating Innovation — and Growth — on the 3rd Platform, #252700, December 2014

Scalable Solutions70K – 700K

Purpose-Built Datacenter SolutionsA New Paradigm for Scale Computing

•Cost Effective

•Energy Efficient

Custom Solutions for Large

Scale Datacenter Deployments

Design and Integration of

Node and Rack Level

Server/Storage Solutions for

Hyperscale Datacenters

Cooled with Ambient Air

Addressable Market Larger than Just CRMIDC Worldwide BPO Market by Verticals(

Our 4 Key Industry Verticals are Higher Margin and Expected to Grow Faster than Overall Market

Sources: (1) IDC: Worldwide and U.S. Business Process Outsourcing Services 2014–2019 Forecast by Vertical and Company Size, doc #256123, May 2015 (Others includes Construction, Resource Industries and Wholesale)(2) Nelson Hall, Global BPO Market Forecast: 014-2018, Version 1.2, June 2014(3) Gartner, Inc., Forecast: IT Services, Worldwide, 2013-2019, 2Q15 Update, G00273625, 15 June 2015(4) IDC, Worldwide Business Analytics Services 2014–2018 Forecast, Doc # 251161, September 2014(5) IDC, Worldwide CRM Applications 2014-2018 Forecast and 2013 Vendor Shares, Doc #248875, May 2014(6) IDC, Worldwide Services Forecast, 2015-2019, Doc # 255796, May 2015(7) IDC, Worldwide and U.S. Business Process Outsourcing Services 2015–2019 Forecast, Doc # 255752, April 2015

Concentrix: A $69B Market Place

Others, 3.80% Personal & Consumer Services, 2.70%

Manufacturing, 23.70%

Financial Services, 13.70%

Government & Education, 10.90%

Telecommunications…

Retail, 6.20%

Professional Services, 6.20%

Utilities, 5.40%

Media, 5.80%

Insurance, 4.80%

Transportation, 3.70%

Healthcare, 3.90%

5.6%CAGR

5.0%CAGR

4.0%CAGR

Maintenance & Support Services $135B+(3)

Business Analytics

Services IT Consulting(4)

$10B+

Consulting(6)

$100B+

CRM Applications(5)

$25B+

Vertical BPO(2)

$170B+

Back Office BPO(2)

$100B+

CRM BPO(1)

$69B 6% CAGR(2015-2019)

Concentrix At-A-Glance

CONSULTATIVE APPROACH

EXTENSIVE DOMAIN EXPERTISE

DEEP CLIENT RELATIONSHIPS

300+CLIENTS

10VERTICALS

9+ YEARS

Average Length of Client Engagements

Transactions Handled Yearly

70,000+STAFF

500,000,000+

$1.4BREVENUE

40+LANGUAGES

25 COUNTRIES /

70+ LOCATIONS

IBM Acquisition in 2014

$15.5B TAM / 9.6% CAGR @ v. High Margin

Banking andFinancial Services

Payer ( Member ) Support

Provider Service

Policy Management

Enrollment Services

Claims Auditing & Payments

$15.5B TAM / 9.6% CAGR @ v. High Margin

Healthcare & Pharmaceuticals

Digital Production & Marketing

Channel Optimization

Loyalty Management

Customer Experience Management

Acquisition & Upsell Support

$3.9B TAM / 6.7% CAGR @ Good Margins

Consumer Electronics and

Technology

Priority Industry Verticals and Service Offerings

Collections & Debit Management

Risk Management & Compliance

Credit Card Processing

Payment Services

Customer Acquisition

Life & Health Policy Administration

Policy Issuance

Claims Adjudication

Payment Processing

Benefit Payments

$15.1B TAM / 6.2% CAGR @ Healthy Margins

Insurance

Technology Platforms

Analytics

Consulting/Transformation

Digital Customer Engagement

SYNNEX:Focused on theFuture

Deeper Penetration of

CNX in Priority High

Margin Verticals

Hyve Solutions

Leverage Scale in

TS and CNX to Drive

More Efficiency

Continued

Optimization of

Core Businesses

Continued Mix Shift

to Higher Margin

Technology Platforms

and Services

Adjacent Market Growth –

Hyve Solutions, BPO

beyond Customer Care

Core Organic Growth

beyond Market Growth

in TS and CNX

Focused Verticals

Emerging

Technologies–

Third Platform/IoT/

Services and CNX

Proprietary Platforms

Continued Growth and Margin Expansion

Well-Positioned for Growth

Concentrix

Execution, Strategic Vision, Customer Focus

• Top 10 Global Player in a Consolidating and Growing Market

• Key Differentiators:

• Flexibility in how We Engage with our Clients

• Expertise in Select Vertical Markets with Unique Intellectual Property in Process and Platforms

• Global Delivery Consistency

• Historical Revenue Growth above Market with Improving Margins

• Well-Positioned for the New World of IT

• Focused Investments in Growth Markets and Technologies

• Seasoned Team

• Corporate/Enterprise, Specialty, Broadline

• Intellectual Property in Business and go to Market Platforms

• Low Cost Structure

Technology Solutions

Target Revenue Growth Range Target Adjusted Operating Margin

Underlying Financial Goals:

Grow EPS Faster than Revenue Growth

ROIC Consistently Higher than WACC

Shareholder Return Superior to our Peers and in Top Tier of Public Companies

0

1

2

3

4

5

6

7

8

9

10

11

12

TechnologySolutions

Concentrix Consolidated

12%

11%

10%

9%

8%

7%

6%

5%

4%

3%

2%

1%

0 0

1

2

3

4

5

6

7

8

9

10

11

12

TechnologySolutions

Concentrix Consolidated

12%

11%

10%

9%

8%

7%

6%

5%

4%

3%

2%

1%

0

+20 to 60 bps

Analyst Day PresentationOutlook FY 2015 through FY 2017

Investment Highlights

Seasoned Management with In-Depth Industry Experience

Strong Track Record of Revenue Growth, Margin Expansion and Strategic Investments

Superior Total Shareholder Return

Customer-Centric Business Strategy Focused on Growth Markets

Recognized Leadership in Customer Care BPO and Technology Distribution

Appendix

Use of Non-GAAP Financial Information

To supplement the financial results presented in accordance with GAAP, SYNNEX uses adjusted operating income, adjusted operating margin, adjusted earnings before interest, taxes, depreciation and amortization (“Adjusted EBITDA”), Adjusted EBITDA margin, which are non-GAAP financial measures that exclude the amortization of intangible assets and acquisition and integration related expenses. These non-GAAP measures provide investors with an additional tool to evaluate operating results. Because these non-GAAP measures are not calculated in accordance with GAAP, they may not necessarily be comparable to similarly titled measures employed by other companies. These non-GAAP financial measures should not be considered in isolation or as a substitute for the comparable GAAP measures, and should be read only in conjunction with the Company's consolidated financial statements prepared in accordance with GAAP.

SYNNEX management uses the non-GAAP financial measures internally to understand, manage and evaluate the business. SYNNEX management believes it is useful for the company and investors to review, as applicable, both GAAP information, and the non-GAAP measures in order to assess the performance of SYNNEX’ continuing businesses and for planning and forecasting in future periods. These non-GAAP measures are intended to provide investors with an understanding of SYNNEX’ operational results and trends that more readily enable investors to analyze SYNNEX' base financial and operating performance and to facilitate period-to-period comparisons and analysis of operational trends. The management of SYNNEX believes the non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision-making. A reconciliation of SYNNEX’ non-GAAP financial information to GAAP is set forth in the supplemental information table at the end of this presentation.

Definition of Non-GAAP Financial Measures

Non-GAAP financial measures included in this presentation are:

• Adjusted operating income, which is defined as income before non-operating items,

income taxes and noncontrolling interest excluding (i) IBM CRM acquisition and other

integration expenses, and (ii) amortization of acquired intangible assets.

• Adjusted operating margin, which is defined as adjusted operating income (as defined

above) divided by revenue.

• Adjusted EBITDA, which is defined as adjusted operating income (as defined above)

excluding depreciation expenses.

• Adjusted EBITDA Margin, which is defined as adjusted EBITDA (as defined above)

divided by revenue.

Reconciliation of GAAP to Non-GAAP Financial Measures(Amounts in Thousands)

Reconciliation of GAAP to Non-GAAP financial measures

Amounts in thousands except per share amounts

2013 2014 2015

Operating Income and Operating Margin

Revenue 10,845,164$ 13,839,590$ 13,338,397$

Income before non-operating items, income taxes and

noncontrolling interest 240,828$ 308,507$ 354,552$

IBM CRM acquisition and other integration expenses 8,394 43,036 10,109

Amortization of intangibles 7,953 55,161 54,756

Adjusted operating income 257,175$ 406,704$ 419,417$

Operating margin 2.22% 2.23% 2.66%

Adjusted operating margin 2.37% 2.94% 3.14%

Operating Income and Operating Margin - TS

Revenue 10,666,216$ 12,755,514$ 11,936,660$



IBM CRM acquisition and other integration expenses - - -





Operating Income and Operating Margin - CNX

Revenue 189,464$ 1,096,213$ 1,416,670$








Adjusted EBITDA


controlling interest 240,828$ 308,507$ 354,552$


Depreciation expense 16,509 36,862 48,754


Adjusted EBITDA 273,684$ 443,566$ 468,171$

Adjusted EBITDA margin 2.52% 3.21% 3.51%

Fiscal year ended November 30,

Calculation of Financial Metrics

as of November 30, 2015

Working Capital Velocity

Revenue (c) 13,338,397$

Average working capital

Accounts receivable (5-quarters average) 1,742,386$

Inventories (5-quarters average) 1,399,156

Accounts payable (5-quarters average) (1,373,069)

Average working capital (d) 1,768,473$

Working Capital Velocity (c) / (d) 8X

Debt to Capitalization

Total borrowings (e) 730,891$

Total equity (f) 1,799,382

Debt to capitalization (e) / ((e) + (f)) 29%

Dividend Yield (Annualized)

Per share dividend declared in the last twelve months (g) 0.575$

Stock price (h) 94.27

Dividend yield (annualized) (g) / (h) 0.61%

The following table (in thousands) presents the calculation for working capital velocity, debt to capitalization and dividend

yield (Annualized).

a technology solutions and business services company · 1/13/2016 · (7) idc, worldwide and u.s....

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