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Computer industry

En Pointe Technologies Inc. Sees Significant Revenue Growth with Innovative Distribution Model

Strategic Insights

— 2 min read

En Pointe Technologies Inc., a leading provider of information technology products and services, has implemented an innovative distribution model that relies on allied distributors, such as Tech Data and Ingram Micro, to fill orders through its AccessPointe catalog of over 300,000 technology products from top manufacturers like 3Com, Dell, Hewlett-Packard, IBM, and Microsoft. This approach has allowed the company to distribute products without maintaining physical inventories, reducing costs and improving efficiency.

The company's net income jumped to $1.5 million, or 21 cents per share, in the fiscal fourth quarter, up from a net loss of $349,000, or 5 cents per share, in the corresponding period last year. The profit increase came despite net sales falling 11 percent, to $78.4 million, from $87.4 million last year. En Pointe's costs for product and services fell by a total of 14 percent to $67 million, while general and administrative expenses edged down 5 percent to $2.7 million.

Key Takeaways:

  • En Pointe Technologies Inc. has adopted a unique distribution model, relying on allied distributors to fill orders through its online catalog of over 300,000 products.
  • The company has seen a significant increase in net income, jumping to $1.5 million in the fiscal fourth quarter, up from a net loss of $349,000 last year.
  • Net sales fell 11 percent to $78.4 million, but the company's costs for product and services decreased by 14 percent to $67 million.
  • General and administrative expenses edged down 5 percent to $2.7 million, contributing to the company's improved profitability.
  • The company's shares rose as high as $7.47 on Friday, nearly triple the previous closing price, before settling back in afternoon trading.
  • The company's previous 52-week high was $3.08, and its stock closed at $2.64 on Thursday.
  • En Pointe's CEO, Attiazaz (Bob) Din, and his wife, Naureen Din, control approximately 30% of the company.

Statistics:

  • Net income: $1.5 million (21 cents per share) in the fiscal fourth quarter, up from a net loss of $349,000 (5 cents per share) in the corresponding period last year.
  • Net sales: $78.4 million, a 11 percent decrease from $87.4 million last year.
  • Cost reductions: 14 percent decrease in costs for product and services, from $77.5 million to $67 million.
  • General and administrative expenses: $2.7 million, a 5 percent decrease from $2.85 million last year.
  • Share price: Rose as high as $7.47 on Friday, nearly triple the previous closing price.
  • Previous 52-week high: $3.08.
  • Closing price on Thursday: $2.64.

Sources:

  • M2 PressWIRE, December 4, 2006
  • En Pointe Technologies Inc. website
  • BellwetherReport.com

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