CDWC: Apples to Apples, CDW’s Sales are Improving

By Willaim Trent, CFA of Stock Market Beat

When CDW Corp. (CDWC) reported seemingly strong average daily sales growth we were quick to throw cold water on the report, noting that the difference was primarily due to acquisition and that in reality the sales were up mid-single digit. This month the news looks somewhat better.

CDW Corporation, a leading provider of technology products and services to business, government and education, today announced average daily sales for March 2007 were $31.644 million, an increase of 24.6 percent compared to average daily sales of $25.392 million for March 2006. Total sales for March 2007 were $696.2 million, an increase of 19.2 percent compared to total sales of $584.0 million for March 2006. There were 22 billing days in March 2007 and 23 billing days in March 2006.As previously announced, CDW completed the acquisition of Berbee Information Networks Corporation on October 11, 2006. March 2006 sales do not include Berbee sales, while March 2007 sales include Berbee sales. Excluding Berbee sales in March 2007, and therefore on a non-GAAP basis, CDW’s average daily sales for March 2007 were $28.431 million, an increase of 12.0 percent compared to average daily sales for March 2006 of $25.392 million. Excluding Berbee sales in March 2007, and therefore on a non-GAAP basis, total sales for March 2007 were $625.5 million, an increase of 7.1 percent compared to total sales of $584.0 million for March 2006. There were 22 billing days in March 2007 and 23 billing days in March 2006.

Without the acquisition and counting the extra selling day last year the sales still rose 7.1%, better than they did last month. On an equivalent-days basis the company cracked double digits. It will be interesting to see if the higher growth can continue, and whether it is confirmed by other tech companies and resellers.

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