Avnet Analyst Day 2010 Presentation 1 Opening Remarks

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Avnet, Inc. 2010 Analyst Day & 50th Anniversary Celebration: Dec 15, 2010

Presenters included: Roy Vallee, chairman and chief executive officer; Rick Hamada, president and chief operating officer; Ray Sadowski, senior vice president and chief financial officer; Harley Feldberg, president, Electronics Marketing; and Phil Gallagher, president, Technology Solutions.

Following the analyst day event, Avnet commemorated its 50th anniversary on the New York Stock Exchange by ringing the closing bell.

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Avnet Analyst Day 2010 Presentation 1 Opening Remarks

  1. 1. Avnet Analyst Day 2010 Performance & Potential Avnet, Inc. December 15, 20101 Accelerating Your Success™
  2. 2. Opening Remarks and Management Introductions Vince Keenan Vice President, Investor Relations2 Accelerating Your Success™
  3. 3. December 2010 Avnet Analyst Day Agenda 9:30 am Check-in 10:00 am Welcome & Introductions Vince Keenan Performance & Potential Roy Vallee Operational Update Rick Hamada Financial Update Ray Sadowski 12:00 pm Buffet Lunch 1:00 pm Technology Solutions Phil Gallagher Electronics Marketing Harley Feldberg Wrap up Roy Vallee 2:45 pm Conclude 3 Accelerating Your Success™
  4. 4. Safe Harbor Statement • This presentation contains certain “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 statements are based on management’s current expectations and are subject to uncertainty and changes in factual circumstances. The forward-looking statements herein include statements addressing future financial and operating results of Avnet and may include words such as “will,” “anticipate,” “expect,” “believe,” and “should” and other words and terms of similar meaning in connection with any discussions of future operating or financial performance or business prospects. Actual results may vary materially from the expectations contained in the forward-looking statements. • The following factors, among others, could cause actual results to differ materially from those described in the forward-looking statements: the Company’s ability to retain and grow market share and to generate additional cash flow, risks associated with any acquisition activities and the successful integration of acquired companies, any significant and unanticipated sales decline, changes in business conditions and the economy in general, changes in market demand and pricing pressures, any material changes in the allocation of product or product rebates by suppliers, allocations of products by suppliers, other competitive and/or regulatory factors affecting the businesses of Avnet generally. • More detailed information about these and other factors is set forth in Avnet’s filings with the Securities and Exchange Commission, including the Company’s reports on Form 10-K, Form 10-Q and Form 8-K. Avnet is under no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. 4 Accelerating Your Success™
  5. 5. 5 Accelerating Your Success™
  6. 6. 6 Accelerating Your Success™
  7. 7. Adaptability Financial Conservatism Culture Profitable Growth Leadership7 Accelerating Your Success™
  8. 8. TECHNOLOGY DISTRIBUTION • Gross Profit $ Volume • ROCE • Market Capitalization8 Accelerating Your Success™
  9. 9. David Birk Steve Church Al MaagSenior Vice President and General Counsel Chief Business Development and Process Officer Chief Communications Officer Avnet, Inc. Avnet, Inc. Avnet, Inc. 30 Years of Service 20 Years of Service 13 Years of Service MaryAnn Miller Steve Phillips Jim Smith Chief Human Resources Officer Chief Information Officer President Avnet, Inc. Avnet, Inc. Avnet Logistics 4 Years of Service 5 Years of Service 10 Years of Service 9 9 Accelerating Your Success™
  10. 10. Roy Vallee Rick Hamada Chairman & Chief Executive Officer President and Chief Operating Officer Avnet, Inc. Avnet, Inc. 33 Years of Service 27 Years of Service Ray Sadowski Phil Gallagher Harley Feldberg Chief Financial Officer President, President, Avnet, Inc. Avnet Technology Solutions Avnet Electronics Marketing10 Accelerating YourService 32 Years of Success™ 28 Years of Service 28 Years of Service
  11. 11. AVNET’S LONGEVITY 148 Years of Sr. Leadership + 90 Years in Business + 50 Years on NYSE11 Accelerating Your Success™
  12. 12. 12 Accelerating Your Success™
  13. 13. Macro Environment
  14. 14. What a Difference a Year Two Years Make… 2009 2010 Actual Dec 09 Forecast Dec 10 Projection EM SAM -15% 9% 22% TS SAM -5% 4% 3% AVT SAM -7% 5% 7%• Avnet’s served available market (SAM) grew faster than initially forecasted• Most volatile 2 year period for semiconductor growth• Concerns of a double-dip have been receding as the global economy continues to grow• Remain in a gradual cyclical recovery 14 Accelerating Your Success™ Sources: Bishop, Electronics Outlook, Fleck, Gartner, IDC, iSuppli (Rev: 11/2010)
  15. 15. Recession’s Impact on SemiconductorsFirst time there has been two consecutive years of declineFirst year of recovery more dramaticV-shape recovery drove new industry record 32% Growth 2009- 350 2010 300 250 ($ Billions) 200 150 100 50 0 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E Growth Decline Source: SIA/WSTS (total semiconductors)15 Accelerating Your Success™
  16. 16. Semiconductor Y/Y Growth Rates Global Semi less DRAM, MPU & Flash 50.0% 48.4% 42.6% 41.6% 40.0% 36.7% 35.1% 30.7% 31.7% 30.0% 29.2% 28.7% 22.0% 25.3% 20.0% 19.4% 22.0% 17.3% 14.2% 12.1% 15.7% 12.9% 11.9% 11.8% 8.9% 11.6% 9.5% 10.0% 7.4% 9.1% 8.7% 9.3% 5.4% 6.1% 2.6% 3.3% 0.0% 0.3% 1.8% -0.4% -4.9% -10.0% -12.8% -15.0% -20.0% Two 100 year floods -18.8% -24.1% in a decade -29.2% -30.0% -31.8% -40.0% -39.2% -42.3% -50.0% Recession Recession Sep-00 Dec-00 Sep-01 Dec-01 Sep-02 Dec-02 Sep-03 Dec-03 Sep-04 Dec-04 Sep-05 Dec-05 Sep-06 Dec-06 Sep-07 Dec-07 Sep-08 Dec-08 Sep-09 Dec-09 Sep-10 Jun-00 Jun-01 Jun-02 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Mar-00 Mar-01 Mar-02 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Source: WSTS16 Accelerating Your Success™
  17. 17. Semiconductor Y/Y Growth Rates Excluding the recessions, the worst quarters in this period were roughly flat year-over-year 50.0% 40.0% 35.1% 30.0% 30.7% 28.7% 25.3% 22.0% 20.0% 12.9% 14.2% 11.9% 11.8% 11.6% 10.0% 8.9% 9.5% 7.4% 9.1% 6.1% 5.4% 3.3% 1.8% 0.0% 0.3% -0.4% -10.0% Sep-03 Dec-03 Sep-04 Dec-04 Sep-05 Dec-05 Sep-06 Dec-06 Sep-07 Dec-07 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 S17 Accelerating Your Success™
  18. 18. Semiconductor Y/Y Growth Rates Resulting in 5 years of uninterrupted growth 50.0% 40.0% 35.1% 30.0% 30.7% 28.7% 25.3% 27% 22.0% 20.0% 18% 14.2% 12.9% 11.9% 11.8% 11.6% 10.0% 8.9% 9.5% 7.4% 9.1% 8% 5.4% 6.1% 6% 3.3% 1.8% 4% 0.0% 0.3% -0.4% 2003 2004 2005 2006 2007 -10.0% Sep-03 Dec-03 Sep-04 Dec-04 Sep-05 Dec-05 Sep-06 Dec-06 Sep-07 Dec-07 Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Mar-03 Mar-04 Mar-05 Mar-06 Mar-07 S18 Accelerating Your Success™
  19. 19. Projected Semiconductor GrowthCurrent forecasts project at least four years of growthTotal 2011-2013 $ growth is greater than pre-recession 2011 - 2013 +47 Billion 350 2005 - 2007 +43 Billion 300 250 ($ Billions) 200 150 100 50 0 2010E 2012E 2011E 2013E 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Growth Decline Source: SIA/WSTS (total semiconductors) 19 Accelerating Your Success™
  20. 20. Projected Semiconductor Growth Rates90s growth driven by business spendNext decade, two 100 year floods impacted semi CAGRHowever, recession only interrupted semi market growth 350 300 250 ($ Billions) 200 10-year CAGR +3.8% 150 100 50 10-year CAGR +14.9% 0 2010E 2012E 2011E 2013E 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Growth Decline Source: SIA/WSTS (total semiconductors) 20 Accelerating Your Success™
  21. 21. Recession’s Impact on IT Spend 1 year decline versus 2 years Less volatile than the semiconductor industry Projections reflect resumption of consistent growth Total $ growth is greater post-recession 2011 - 2013 2,000 +273 Billion 1,800 2006 - 2008 +257 Billion 1,600 1,400 1,200($ Billions) 1,000 800 600 400 200 0 1997 1995 1996 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010E 2011E 2012E 2013E Growth Decline21 Accelerating Your Success™ Source: IDC (All Hardware, Software and Services) - 10/2010
  22. 22. GDP Growth Versus Total IT Spend Hardware growth rate higher post recession Avnet Technology Solutions is ~70% Hardware IT Spend grew 6.5% IT Spend projected to grow 5.7% 2.1x GDP 1.6x GDP 2005-2008 CAGR 2010-2013 CAGR 2.5x8% 8% 2.0x 8.0% 1.9x 1.7x 1.9x6% 6% 6.6% 6.4% 6.2% 5.9% 1.2x4% 4% 4.3% 3.2% 3.6%2% 2%0% 0% GDP Hardware Services Software GDP Hardware Services Software 3 yrs leading into the recession 3 yrs leading out of the recession 22 Accelerating Your Success™ Source - IDC - Oct 2010; GDP - IMF Oct 2010
  23. 23. Served Available Market
  24. 24. EM SAM – Continued Growth Following Record Total Growth 2011-2013 +$58B 350 $331 $313 300 $291 $274 250 $225 200US$ Billion 150 100 50 0 2009 2010 2011 2012 2013Sources: Bishop, Electronics Outlook, Fleck, Gartner, iSuppli (Rev: 11/2010) 24 Accelerating Your Success™
  25. 25. TS SAM – Steady Growth Toward One Trillion Total Growth 2011-2013 +$141B 1,200 $1,087 $1,034 $984 $914 $946 900 US$Billions 600 300 0 2009 2010 2011 2012 2013 Source: IDC, Gartner, iSuppli (rev. 11/2010) 25 Accelerating Your Success™
  26. 26. Large Market That is Leading the Recovery Avnet Total Served Available Market $1,446B 1,500 $1,366B 5% $1,278B 6% $1,205B $1,149B 5% 1,250 7% -7% 1,000 5% ($ billions) 5% 750 3% 4% -5% 500 250 22% 6% 8% 6% -15% 0 2009 2010 2011 2012 2013 Total Component TAM w/o MPUs, DRAMs, or Flash Total Computer TAM w/ Professional Services Note: Percentages represent sequential growth rates. Sources: Bishop, Electronics Outlook, Fleck, Gartner, IDC, iSuppli (Rev: 11/2010) 26 Accelerating Your Success™
  27. 27. Avnet’s Global Growth Opportunity Distributor Distributor TAM ~$319B TAM Total TAM ~$319B $1,275 B Direct TAM Direct TAM Avnet ~$956B ~$956B ~$24.2 Billion*27 Accelerating Your Success™ *Avnet’s FY11 revenue is an estimate based upon Q1FY11 annualized excluding Prosys
  28. 28. Avnet’s Vision Statement Avnet will deliver the highest value to our customers, suppliers, employees and shareholders as the premier technology marketing, distribution and services company, globally28 Accelerating Your Success™
  29. 29. Business Segment Overview Electronics Marketing (EM) Technology Solutions (TS) • Markets and distributes electronic • Markets and distributes complex computer components and embedded systems to products to VARs, systems builders and OEMs, ODMs and EMS providers OEMs – Products include semiconductors, – Products include enterprise servers, interconnect, passive, electromechanical storage systems, embedded subsystems, and subsystems networking software and services – Value-added services spanning the design – Value-added services including marketing, and supply chains globally including tech support, configuration, integration, substantial product enhancement training and financial FY 2010 Revenue FY 2010 EBIT1 10/2/10 Working Capital2 TS TS TS 43% 34% 28% 57% 66% 72% EM EM EM1 Excludes corporate expenses, restructuring, integration and other charges 2 Working capital = Trade Receivables + Inventory - Payables29 Accelerating Your Success™
  30. 30. Emerged from Recession a Much Stronger Company $25.0 Revenue: -$1.8B +$3B $24.2 Cash from Ops: +$1.1B -$30M $22.5 $20.0 $19.2Revenue US$Billions $18.0 Acquired 3 $17.5 companies that $16.2 add ~$4B of $15.0 revenue and achieve 12.5% ROCE with no $12.5 add’l debt or equity capital $10.0 FY 2008 FY 2009 FY 2010 Q1FY11 Q1FY11 Annualized* * Excludes ProSys 30 Accelerating Your Success™
  31. 31. Avnet – Global Leader in Technology Distribution Gross Profit Dollar Volume Return on Capital Employed (ROCE) Market Capitalization• VBM culture improving performance through the cycles• Exited this downturn a much stronger company – Setting quarterly records for revenue, EPS and ROCE – More diversified revenue stream with significant growth opportunities – Experienced management team with proven, consistent performance• Served market >$1.2 trillion and growing much faster than GDP• Avnet is growing much faster than the market – Organic and value creating M&A 31 Accelerating Your Success™
  32. 32. Q&A

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