<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM 10-Q
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 31, 1996
--------------------
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
--- ---
Commission file number 1-14192
--------
- --------------------------------------------------------------------------------
VANSTAR CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
- --------------------------------------------------------------------------------
Delaware 94-2376431
(State or Other Jurisdiction (I.R.S. Employer Identification No.)
of Incorporation or Organization)
5964 West Las Positas Boulevard, Pleasanton, California 94588
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (510) 734-4000
--------------
Indicate by check X whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
--- ---
The number of outstanding shares of the Registrant's Common Stock, par
value $.001 per share, was 40,475,144 on August 30, 1996.
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
VANSTAR CORPORATION
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT SHARE DATA)
ASSETS
<TABLE>
<CAPTION>
July 31, April 30,
1996 1996
---------- ----------
(unaudited)
<S> <C> <C>
Current assets:
Cash $ 13,674 $ 14,498
Receivables, net of allowance for doubtful accounts of
$12,532 at July 31, 1996, and $14,812 at April 30,1996 292,061 298,484
Inventories 337,021 350,406
Deferred income taxes 20,016 25,750
Prepaid expenses and other current assets 2,114 2,432
---------- ----------
Total current assets 664,886 691,570
Property and equipment, net 22,883 23,183
Other assets, net 49,530 48,899
Goodwill, net of accumulated amortization of
$3,687 at July 31, 1996, and $3,453 at April 30, 1996 52,921 39,713
---------- ----------
$ 790,220 $ 803,365
---------- ----------
---------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 343,260 $ 305,374
Accrued liabilities 44,573 41,586
Deferred revenue 24,348 27,109
Current maturities of long-term debt 1,938 1,759
---------- ----------
Total current liabilities 414,119 375,828
Long-term debt, less current maturities 233,216 293,007
Other long-term liabilities 6,069 7,477
Commitments and contingencies - -
Stockholders' equity:
Common stock, $.001 par value, 100,000,000 shares
authorized, 40,475,144 shares issued and outstanding 40 40
Additional paid-in capital 115,097 115,097
Retained earnings (since a deficit elimination of $78,448 at April 30, 1994) 21,679 11,916
---------- ----------
Total stockholders' equity 136,816 127,053
---------- ----------
$ 790,220 $ 803,365
---------- ----------
---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
VANSTAR CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended
July 31,
-------------------------
1996 1995
---------- ----------
(unaudited)
<S> <C> <C>
Revenue:
Product $ 490,065 $ 374,083
Services 69,025 53,086
---------- ----------
Total revenue 559,090 427,169
---------- ----------
Cost of revenue:
Product 441,593 339,883
Services 39,375 28,391
---------- ----------
Total cost of revenue 480,968 368,274
---------- ----------
Gross margin 78,122 58,895
Selling, general and administrative expenses 56,896 46,362
---------- ----------
Operating income 21,226 12,533
Interest income 882 1,557
Interest expense (6,611) (8,830)
---------- ----------
Income before income taxes 15,497 5,260
Income tax provision (5,734) (1,946)
---------- ----------
Net income $ 9,763 $ 3,314
---------- ----------
---------- ----------
Primary and fully diluted earnings per share (pro
forma prior to March 11, 1996 - See note 2) $ 0.23 $ 0.10
---------- ----------
---------- ----------
Shares used in per share calculation 43,141 33,030
---------- ----------
---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
VANSTAR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
<TABLE>
<CAPTION>
Three Months Ended
July 31,
-------------------------
1996 1995
---------- ----------
(unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 9,763 $ 3,314
Adjustments:
Depreciation and amortization 3,870 2,393
Change in provision for doubtful accounts (1,779) 631
Changes in operating assets and liabilities:
Receivables 30,867 16,798
Inventories 20,379 (26,695)
Prepaid expenses and other assets 294 (276)
Deferred income taxes 5,734 1,946
Accounts payable 31,726 (10,288)
Accrued and other liabilities (6,448) (2,706)
---------- ----------
Total adjustments 84,643 (18,197)
---------- ----------
Net cash provided by (used in) operating activities 94,406 (14,883)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (3,148) (4,163)
Proceeds from sale of building 3,125 -
Purchase of business, net of cash acquired (34,532) -
---------- ----------
Net cash used in investing activities (34,555) (4,163)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on long-term debt (1,903) (196)
Borrowings (repayments) under line of credit, net (58,772) 21,711
Issuance of warrants - 500
---------- ----------
Net cash provided by (used in) financing activities (60,675) 22,015
---------- ----------
NET INCREASE (DECREASE) IN CASH (824) 2,969
Cash at beginning of the period 14,498 7,761
---------- ----------
CASH AT END OF THE PERIOD $ 13,674 $ 10,730
---------- ----------
---------- ----------
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL
The financial statements for Vanstar Corporation (the "Company") for the
three month periods ended July 31, 1996 and July 31, 1995 are unaudited and have
been prepared in accordance with generally accepted accounting principles for
interim financial reporting and Securities and Exchange Commission regulations.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations. In the
opinion of management, the financial statements reflect all adjustments (of a
normal and recurring nature) which are necessary for a fair presentation of the
financial position, results of operations and cash flows for the interim
periods. These financial statements should be read in conjunction with the
Company's Annual Report on Form 10-K for the fiscal year ended April 30, 1996.
The results of operations for the three months ended July 31, 1996 are not
necessarily indicative of the results to be expected for the entire fiscal year.
2. EARNINGS PER SHARE
Earnings per share and shares used in per share calculation for periods
prior to March 11, 1996, the date of the Company's initial public offering, have
been presented on the consolidated statements of income as if the conversion of
the Company's preferred stock and warrants had occurred at the later of the
beginning of the period or the issuance date.
Primary and fully diluted earnings per share is computed using the weighted
average number of shares of Common Stock and dilutive common stock equivalents
outstanding during the period. Common stock equivalents are computed for the
Company's outstanding options using the treasury stock method. Pursuant to the
Securities and Exchange Commission Staff Accounting Bulletins, common stock
equivalents also include amounts computed on options and warrants issued during
the twelve months immediately preceding the date of the initial filing of the
Company's Registration Statement on Form S-1 relating to the Company's initial
public offering as if they were outstanding for all periods prior to the closing
on March 11, 1996 (using the treasury stock method and the initial public
offering price of $10.00).
3. LITIGATION AND CONTINGENCIES
Various legal actions arising in the normal course of business have been
brought against the Company. Management believes that the ultimate resolution of
these actions will not have a material adverse effect on the Company's financial
position or results of operations, taken as a whole.
4. ACQUISITION
Effective May 24, 1996, the Company, through a wholly-owned subsidiary,
acquired certain of the assets and assumed certain of the liabilities of
Dataflex Corporation and of Dataflex's wholly-owned subsidiary, Dataflex
Southwest Corporation. The assets acquired and liabilities assumed comprise
substantially all of the assets and liabilities previously associated with the
business operations of Dataflex known as the Dataflex Western Region and
Dataflex Southwest Region. The two Dataflex regions offer PC product
distribution, service and support in the states of Arizona, California,
Colorado, New Mexico, Nevada and Utah and reported revenues of approximately
$145 million for the fiscal year ended March 31, 1996. The purchase price of
the assets and businesses acquired from Dataflex was approximately $42.0
million, subject to certain post-closing adjustments. Of this amount, the
Company paid approximately $37.0 million in cash on May 29, 1996, with the
remainder due following the completion of an audit of the assets acquired and
the liabilities assumed as of May 31, 1996 and the completion of certain other
post closing matters.
<PAGE>
5. SUBSEQUENT EVENTS
On August 27, 1996, the Company announced that it plans to offer
approximately $125.0 million ($143.8 million if the underwriter's over-allotment
option is exercised in full) of convertible preferred trust interests to
qualified institutional buyers and a limited number of other institutional
accredited investors and foreign investors. The trust interests will be
convertible to shares of the Company's Common Stock and will entitle holders to
quarterly distribution payments. The Company intends to use the net proceeds of
the offering to reduce the outstanding indebtedness to IBM Credit Corporation
("IBMCC") as part of a refinancing plan directed at converting its long-term
variable rate debt to fixed rate debt and reducing its overall interest costs.
The refinancing plan also contemplates repayment of the remainder of the IBMCC
indebtedness with the proceeds of an accounts receivable-based asset
securitization transaction promptly following the consummation of the offering.
The Company expects to complete the refinancing plan during the second quarter
of its current fiscal year.
Effective September 4, 1996, the Company consummated the acquisition of
Mentor Technologies LTD, ("Mentor"), an Ohio limited partnership providing
information technology training and education. Mentor reported revenues of
approximately $5.5 million for the year ended December 31, 1995. Management of
the Company anticipates that this acquisition will strengthen the Company's
ability to offer training and education services in Ohio and throughout the
upper midwestern United States.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The Company's four primary sources of revenue are product, professional
services, life cycle services and other services. The Company refers to the
integration of its product and service offerings designed to provide
customized solutions to support its customers' PC network infrastructure
throughout its life cycle as "Life Cycle Management." Product revenue is
primarily derived from the sale of computer hardware, software, peripherals,
and communications devices manufactured by third parties and sold by the
Company. During the first quarter of fiscal year 1997, the Company realigned
its service offerings to position itself to better meet its customer's
growing need to gain control of the management and the escalating cost of
distributed computing network infrastructures. Professional services
(formerly networking) revenue is derived from network installation,
enhancement and migration plus consulting services to plan, design, manage,
and implement new client/server technologies. Life cycle services (formerly
support services) revenue is derived from desktop support services which
encompass customized service, enhancement, and support solutions required as a
result of customer's outsourcing the ownership and management of
client/server environments. Desktop support services integrates the
services of desktop support, help desk, repair and maintenance, asset
management and desktop installation. Other services revenue is primarily
derived from fees earned on the distribution services agreement with Merisel
FAB Inc. ("Merisel FAB"), training and education services. Pursuant to a
distribution services agreement, the Company provides product distribution to
franchises and affiliates to Merisel FAB.
The Company is continually expanding its professional services and life
cycle service offerings. During the first quarter of fiscal year 1997, the
Company established a research and development unit to support advanced
information technology initiatives. The research and development unit will
provide expertise in areas such as security and network management and will
maintain a technology evaluation and testing facility. The Company also
commenced development of a network operations center to broaden its remote
network management capabilities. The network operations center will serve
multiple clients and lines of business, and is expected to be operational by the
end of the second quarter of fiscal year 1997.
The following table sets forth for the periods indicated, the Company's (i)
total revenue, gross margin and gross margin percentage by revenue source,(ii)
selling, general and administrative expenses in total and as a percentage of
total revenue and (iii) operating income in total and as a percentage of total
revenue.
Three Months Ended
July 31,
-------------------------
1996 1995
---------- ----------
REVENUE:
Product $ 490,065 $ 374,083
Services:
Professional services 21,698 10,855
Life cycle services 38,939 33,484
Other services 8,388 8,747
---------- ----------
Total revenue $ 559,090 $ 427,169
---------- ----------
---------- ----------
GROSS MARGIN:
Product $ 48,472 $ 34,200
Services:
Professional services 8,417 4,899
Life cycle services 14,485 12,423
Other services 6,748 7,373
---------- ----------
Total gross margin $ 78,122 $ 58,895
---------- ----------
---------- ----------
<PAGE>
Three Months Ended
July 31,
-------------------------
1996 1995
---------- ----------
GROSS MARGIN PERCENTAGE:
Product 9.9% 9.1%
Services:
Professional services 38.8% 45.1%
Life cycle services 37.2% 37.1%
Other services 80.4% 84.3%
---------- ----------
Total gross margin percentage 14.0% 13.8%
---------- ----------
---------- ----------
Selling, general and administrative
expenses $ 56,896 $ 46,362
% of total revenue 10.2% 10.9%
Operating income $ 21,226 $ 12,533
% of total revenue 3.8% 2.9%
THREE MONTHS ENDED JULY 31, 1996 AS COMPARED TO THE THREE MONTHS ENDED JULY 31,
1995
PRODUCT. Revenue increased 31.0% to $490.1 million for the three months
ended July 31, 1996 from $374.1 million for the three months ended July 31,
1995 as a result of the Company's successful sales and marketing efforts and
increased sales resulting from the acquisition of the Dataflex Regions.
Gross margin increased 41.7% to $48.5 million for the three months ended July
31, 1996 from $34.2 million for the three months ended July 31, 1995. Gross
margin percentage increased to 9.9% for the three months ended July 31, 1996
from 9.1% for the three months ended January 31, 1995.
PROFESSIONAL SERVICES. Revenue increased 99.9% to $21.7 million for the
three months ended July 31, 1996 from $10.9 million for the three months
ended July 31, 1995. This increase reflects the increased customer demand
for the Company's value-added PC network services offered, as large corporate
customers continued to transition to new higher performance technologies and
client/server networks . Gross margin increased 71.8% to $8.4 million for
the three months ended July 31, 1996 from $4.9 million for the three months
ended July 31, 1995. Gross margin percentage decreased to 38.8% for the
three months ended July 31, 1996 from 45.1% for the three months ended July
31, 1995. The decrease in gross margin percentage resulted from an increase
in transitional training and deployment costs reflecting the Company's
continued commitment to hire and train additional systems engineers to
support Microsoft NT.
LIFE CYCLE SERVICES. Revenue increased 16.3% to $38.9 million for the
three months ended July 31, 1996 from $33.5 million for the three months ended
July 31, 1995. This increase reflects the increase in demand for the Company's
overall life cycle service offerings which more than offset a decline in repair
and maintenance services attributable to improved product reliability and a
shift by vendors to extended warranty programs. Gross margin increased 16.6% to
$14.5 million for the three months ended July 31, 1996 from $12.4 million for
the three months ended July 31, 1995. Gross margin percentage remained
relatively constant at 37.2% for the three months ended July 31, 1996 as
compared to 37.1% for the three months ended July 31, 1995.
OTHER SERVICES. Revenue decreased 4.1% to $8.4 million for the three
months ended July 31, 1996 from $8.7 million for the three months ended July 31,
1995. Gross margin decreased 8.5% to $6.7 million for the three months ended
July 31, 1996 from $7.4 million for the three months ended July 31, 1995. Gross
margin percentage decreased to 80.4% for the three months ended July 31, 1996
from 84.3% for the three months ended July 31, 1995. These declines were
primarily the result of a negotiated reduction in the distribution fees from
Merisel FAB.
<PAGE>
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses increased by 22.7% to $56.9 million for the three
months ended July 31, 1996 from $46.4 million for the three months ended July
31, 1995. Selling, general and administrative expenses as a percentage of
revenue decreased to 10.2% for the three months ended July 31, 1996 from 10.9%
for the three months ended July 31, 1995. This decrease is a result of higher
product and professional service revenues that more than offset the associated
increase in fixed costs as well as cost reduction efforts and operational
improvements.
OPERATING INCOME. Operating income increased 69.4% to $21.2 million for
the three months ended July 31, 1996 from $12.5 million for the three months
ended July 31, 1995. This increase was the result of the increase in gross
margin percentage coupled with a decrease in selling, general and
administrative expenses as a percentage of total revenue. Operating income
as a percentage of total revenue increased to 3.8% for the three months ended
July 31, 1996 from 2.9% for the three months ended July 31, 1995.
INTEREST. Interest expense is incurred primarily on borrowings to support
the working capital requirements of the product business and the Merisel FAB
distribution services agreement. Interest expense decreased 25.1% to $6.6
million for the three months ended July 31, 1996 from $8.8 million for the three
months ended July 31, 1995 due to lower average borrowings and interest rates.
TAXES. The effective tax rate for the three months ended July 31, 1996 of
37% was different than the U.S. statutory rate of 35% due to state tax
provisions. At July 31, 1996 and April 30, 1996, the Company has recorded net
deferred tax assets of $25.6 million and $31.3 million, respectively. The full
realization of the deferred tax assets carried at July 31, 1996 is dependent
upon the Company achieving future pretax earnings, prior to the expiration of
the net operating loss carryforwards, of $69.2 million. The net operating loss
carryforwards expire in the years 2000 through 2010. Management believes that
sufficient income will be generated from operations to realize the net deferred
tax assets.
LIQUIDITY AND CAPITAL RESOURCES
The Company currently has a $450 million line of credit under the Financing
Program Agreement with IBMCC. At July 31, 1996 the Company had $301 million
outstanding under this facility of which $71 million is included in accounts
payable and $230 million is classified as long-term debt. Borrowings under the
line of credit are subject to certain borrowing base limitations and are secured
by portions of the Company's inventory, accounts receivable, and certain other
assets. The line of credit currently has a term expiring October 31, 1997 and
is renewable thereafter for successive six-month periods. IBMCC may terminate
the line of credit at any time upon 90 days' notice to the Company. In the
event of such termination, the outstanding borrowings under the Financing
Program Agreement mature at the end of the term of the line of credit. As of
July 31, 1996 amounts borrowed under the line of credit bear interest at prime
minus 0.50%.
As a result of improved profitability, decreases in accounts receivable
and inventory and increases in accounts payable, the Company's operating
activities provided cash of $94.4 million for the first quarter of fiscal
year 1997. The decrease in receivables is primarily the result of payments
received on the Company's accounts receivable from Merisel FAB and
collections on receivables purchased in the acquisition of the Dataflex
Regions. On May 29, 1996, the Company entered into an agreement with a third
party under which the Company received $15.6 million in cash in exchange for
providing the third party the right to receive payments in May, June and July
1997 totaling $20.0 million out of amounts collected from the extended credit
owed to the Company by Merisel FAB. The decrease in inventory was due to
increased product sales in the quarter ended July 31, 1996. The increase in
accounts payable is the result of the Company's ability to fund a greater
percentage of its inventory through trade payables.
The Company used cash of $34.5 million to purchase the Dataflex Regions
(net of cash acquired) and $58.8 million to repay amounts borrowed under its
Financing Program Agreement with IBMCC. As a result, the Company's working
capital decreased and its debt to equity ratio improved to 1.7 at July 31,
1996 from 2.3 at April 30, 1996. The Company also used cash of $3.1 million
for capital expenditures during the first quarter of fiscal year 1997 and
plans to make additional significant investments in its automated systems and
its capital equipment throughout the remainder of fiscal year 1997.
<PAGE>
Effective May 24, 1996, the Company acquired substantially all of the
assets and liabilities previously associated with the business operations of
Dataflex Corporation known as the Dataflex Western and Southwest Regions.
The Company paid $37.0 million against an estimated purchase price of $42.0
million. The purchase price is subject to certain post-closing adjustments.
On September 4, 1996, the Company issued 300,000 shares of its Common Stock
to acquire Mentor Technologies LTD, an Ohio limited partnership providing
information technology training and education. In addition to the
acquisition of the Dataflex Regions and the Mentor Technologies LTD
acquisition, the Company intends to continue to pursue the acquisition of
other companies that sell products and services that either complement or are
expected to expand its existing business.
On August 27, 1996, the Company announced that it plans to offer
approximately $125.0 million ($143.8 million if the underwriter's
over-allotment option is exercised in full) of convertible preferred trust
interests to qualified institutional buyers and a limited number of other
institutional accredited investors and foreign investors. The trust
interests will be convertible to shares of the Company's Common Stock and
will entitle holders to quarterly distribution payments. The Company intends
to use the net proceeds of the offering to reduce the outstanding
indebtedness to IBM Credit Corporation ("IBMCC") as part of a refinancing
plan directed at converting its long-term variable rate debt to fixed rate
debt and reducing its overall interest costs. The refinancing plan also
contemplates repayment of the remainder of indebtedness with the proceeds of
an accounts receivable-based asset securitization transaction planned to be
implemented promptly following consummation of the offering. The Company
expects to complete the refinancing plan during the second quarter of its
current fiscal year.
The Company believes that the cash generated from operations together
with its existing credit facilities, the planned offering of convertible
preferred trust interests and the planned accounts receivable securitization
will be sufficient to meet its cash requirements through at least the end of
fiscal 1998.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6 EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS
Exhibits
No. Description
-------- -----------
11.1 Computation of Per Share Earnings
27 Financial Date Schedule
B. REPORTS ON FORM 8-K
The following reports on Form 8-K were filed during the quarter ended
July 31, 1996:
1. Report on Form 8-K dated May 24, 1996 reporting the
acquisition of the Dataflex regions.
2. Report on Form 8-K dated June 14, 1996 reporting the
agreement with Donaldson Lufkin & Jenrette Securities
Corporation.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
VANSTAR CORPORATION
[NAME OF REGISTRANT]
Dated: September 10, 1996 By: /s/ Jeffrey S. Rubin
-----------------------------------
Name: Jeffrey S. Rubin
Title: Vice Chairman
Chief Financial Officer
<PAGE>
Exhibit 11.1
VANSTAR CORPORATION
STATEMENT OF COMPUTATION OF EARNINGS PER SHARE
(In thousands, except per share data)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
JULY 31,
-------------------------
1996 1995
---------- ----------
<S> <C> <C>
PRIMARY EARNINGS PER SHARE
Weighted average number of
common shares outstanding 40,475 11,032
Common equivalent shares from stock options
using the treasury stock method 2,666 22
Common shares from the assumed conversion
of all outstanding preferred stock and warrants - 20,305
Common equivalent shares from stock options
related to SAB No. 83 using the treasury
stock method - 1,671
---------- ----------
Shares used in per share calculation 43,141 33,030
---------- ----------
---------- ----------
Net Income $9,763 $3,314
---------- ----------
---------- ----------
Earnings per share $0.23 $0.10
---------- ----------
---------- ----------
FULLY DILUTED EARNINGS PER SHARE
Weighted average number of
common shares outstanding 40,475 11,032
Common equivalent shares from stock options
using the treasury stock method 2,698 22
Common shares from the assumed conversion
of all outstanding preferred stock and warrants - 20,305
Common equivalent shares from stock options
related to SAB No. 83 using the treasury
stock method - 1,671
---------- ----------
Shares used in per share calculation 43,173 33,030
---------- ----------
---------- ----------
Net Income $9,763 $3,314
---------- ----------
---------- ----------
Earnings per share $0.23 $0.10
---------- ----------
---------- ----------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE 1ST
QUARTER FORM 10-Q FOR THE FISCAL YEAR 4/30/97 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> APR-30-1997
<PERIOD-END> JUL-31-1996
<CASH> 13,674
<SECURITIES> 0
<RECEIVABLES> 292,061
<ALLOWANCES> 12,532
<INVENTORY> 337,021
<CURRENT-ASSETS> 664,886
<PP&E> 22,883
<DEPRECIATION> 50,707
<TOTAL-ASSETS> 790,220
<CURRENT-LIABILITIES> 414,119
<BONDS> 0
0
0
<COMMON> 40
<OTHER-SE> 136,776
<TOTAL-LIABILITY-AND-EQUITY> 790,220
<SALES> 490,065
<TOTAL-REVENUES> 559,090
<CGS> 441,593
<TOTAL-COSTS> 480,968
<OTHER-EXPENSES> 56,896
<LOSS-PROVISION> (1,779)
<INTEREST-EXPENSE> 6,611
<INCOME-PRETAX> 15,497
<INCOME-TAX> 5,734
<INCOME-CONTINUING> 9,763
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 9,763
<EPS-PRIMARY> 0.23
<EPS-DILUTED> 0.23
</TABLE>
