|
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
(Address of principal executive offices)
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
|
|
|
|
Accelerated filer ☐
|
Non-accelerated filer ☐
|
Smaller reporting company
|
Emerging growth company ☐
|
|
Page
|
||
1
|
||
Part I
|
||
Item 1.
|
3
|
|
Item 1A.
|
13
|
|
Item 1B.
|
26
|
|
Item 1C.
|
26
|
|
Item 2.
|
27
|
|
Item 3.
|
27
|
|
Item 4.
|
27
|
|
Part II
|
||
Item 5.
|
28
|
|
Item 6.
|
28
|
|
Item 7.
|
29
|
|
Item 7A.
|
45
|
|
Item 8.
|
46
|
|
Item 9.
|
46
|
|
Item 9A.
|
46
|
|
Item 9B.
|
47
|
|
Item 9C.
|
47
|
|
Part III
|
||
Item 10.
|
48
|
|
Item 11.
|
48
|
|
Item 12.
|
48
|
|
Item 13.
|
48
|
|
Item 14.
|
48
|
|
Part IV
|
||
Item 15.
|
48
|
|
Item 16.
|
51
|
|
52 |
• |
national and international political instability fostering uncertainty and volatility in the global economy including exposure to fluctuation in foreign currency rates, interest rates, and inflation, including increases in our costs and
our ability to increase prices to our customers, which may result in adverse changes in our gross profit;
|
• |
significant adverse changes in, reductions in, or loss of one or more of our larger volume customers or vendors;
|
• |
a possible decrease in the capital spending budgets of our customers or a decrease in purchases from us;
|
• |
reliance on third-parties to perform some of our service obligations to our customers, and the reliance on a small number of key vendors in our supply chain with whom we do not have long-term supply agreements, guaranteed price
agreements, or assurance of stock availability;
|
• |
our ability to remain secure during a cybersecurity attack, including both disruptions in our or our vendors’ Information Technology (“IT”) systems and data and audio communication networks;
|
• |
our ability to secure our own and our customers’ electronic and other confidential information, while maintaining compliance with evolving data privacy and regulatory laws and regulations;
|
• |
ongoing remote work trends, and the increase in cybersecurity attacks that have occurred while employees work remotely and our ability to adequately train our personnel to prevent a cyber event;
|
• |
the possibility of a reduction of vendor incentives provided to us;
|
• |
our dependence on key personnel to maintain certain customer relationships, and our ability to hire, train, and retain sufficient qualified personnel;
|
• |
maintaining and increasing advanced professional services by recruiting and retaining highly skilled, competent personnel, and vendor certifications;
|
• |
risks relating to use or capabilities of artificial intelligence including social and ethical risks;
|
• |
our ability to manage a diverse product set of solutions, including artificial intelligence (“AI”) products and services, in highly competitive markets with a number of key vendors;
|
• |
our dependency on continued innovations in hardware, software, and service offerings, including AI products and services, by our vendors and our ability to partner with them;
|
• |
changes in the IT industry and/or rapid changes in product offerings, including the proliferation of the cloud, infrastructure as a service (“IaaS”), software as a service (“SaaS”), platform as a service (“PaaS”), and AI;
|
• |
our ability to increase the total number of customers using integrated solutions by up-selling within our customer base and gaining new customers;
|
• |
our ability to increase the total number of customers who use our managed services and professional services and continuing to enhance our managed services offerings to remain competitive in the marketplace;
|
• |
our ability to perform professional and managed services competently, in accordance with professional standards, and free from errors or omissions;
|
• |
rising interest rates or the loss of key lenders or the constricting of credit markets;
|
• |
loss of our credit facility or credit lines with our vendors may restrict our current and future operations;
|
• |
domestic and international economic regulations uncertainty (e.g., tariffs, sanctions, and trade agreements);
|
• |
supply chain issues, including a shortage of IT products, may increase our costs or cause a delay in fulfilling customer orders, or increase our need for working capital, or delay completing professional services, or purchasing IT
products or services needed to support our internal infrastructure or operations, resulting in an adverse impact on our financial results;
|
• |
exposure to changes in, interpretations of, or enforcement trends in, and customer and vendor actions in anticipation of or response to, legislation and regulatory matters;
|
• |
our inability to identify acquisition candidates, perform sufficient due diligence prior to completing an acquisition, successfully integrate a completed acquisition, or identify an opportunity for or successfully
complete an asset disposition, may affect our earnings;
|
• |
our contracts may not be adequate to protect us as we are subject to external audits which we may not pass, and our professional and liability insurance policies coverage may be insufficient to cover a claim;
|
• |
a natural disaster or other adverse event at one of our primary configuration centers, data centers, or a third-party provider location could negatively impact our business;
|
• |
failure to comply with public sector contracts, or applicable laws or regulations;
|
• |
our ability to raise capital, maintain or increase as needed our lines of credit with vendors or floor planning facility, obtain debt for our financing transactions, or the effect of those changes on our
common stock price;
|
• |
significant and rapid inflation may cause price, wage, and interest rate increases, as well as increases in operating costs that may impact the arrangements that have pricing commitments over the term of the agreement;
|
• |
we may not continue to repurchase any of our common stock under our share repurchase program;
|
• |
our ability to implement comprehensive plans for the integration of sales forces, cost containment, asset rationalization, systems integration, and other key strategies;
|
• |
fluctuations in foreign currency exchange rates may impact our results of operation and financial position;
|
• |
our ability to maintain our proprietary software and update our technology infrastructure to remain competitive in the marketplace; and
|
• |
our ability to protect our intellectual property rights and successfully defend any challenges to the validity of our patents or allegations that we are infringing upon any third-party patents, and the costs
associated with those actions, and, when appropriate, the costs associated with licensing required technology.
|
ITEM 1. |
BUSINESS
|
• |
IT sales provides hardware, perpetual and subscription software, maintenance, software assurance, and outsourced services.
|
• |
Managed services for infrastructure and cloud proactively monitor and manage a broad range of technologies on-premises and in the cloud
with services such as Managed Services for Azure, Managed WebEx Calling, Managed WebEx Call Center, network and firewall management and Managed Power Protection to ensure support of a broad cross-section of technologies spanning multiple
Original Equipment Manufacturer (OEM) solutions. These solutions are built in a flexible subscription model to monitor, manage, and maximize business critical technologies—including cloud, security, data center, mobility, and collaboration
based on an ITIL Framework backed with SOC 1 Type 2 and SOC 2 Type 2 attestations. We also provide ePlus® Automated Virtual Assistant (AVA) for Collaboration Spaces. ePlus AVATM uses robotic process
automation accompanied by ePlus Managed Services to present an exceptional experience for users in video-enabled conference rooms and workspaces.
|
• |
Enhanced Maintenance Support (EMS) or ePlus Lifecycle-Services Support (ELSS) simplifies our customers support experience with single-call support for
multi-vendor environments. We provide 24x7x365 level 1, 2, and 3 support from dedicated engineers and a certified bench of experts. Our services are certified by our leading manufacturer partners. Various OEM solutions are e-Bonded or
Smart-Bonded, providing bi-directional ticket synchronization to facilitate expedient resolution and a custom executive dashboard provides related lifecycle data to the customer for all contracted assets.
|
• |
Service desk provides outsourced functions including, but not limited to,
server and desktop and account management support to respond to our customers’ business demands while minimizing overhead.
|
• |
Storage-as-a-Service is a solution powered by Pure Storage Evergreen//One that provides customers with on-premises storage in a consumption-based model with on-demand burst capacity, backed by
Service Level Agreements (SLAs), and ePlus expert Enhanced Maintenance Support (EMS). This allows customers to consume storage in a cloud-like model in their data center addressing planned and/or
unforeseen capacity needs resulting from ongoing cloud migrations and other parallel IT projects.
|
• |
Cloud Hosted Services provide cloud-hosted offerings including Cloud Managed Backup and Cloud Disaster Recovery. These data protection offerings, delivered under SOC 2 Type 2 and HIPAA
attestations, are focused on delivering confidence to our customers in their ability to rapidly recover when incidents such as ransomware occur.
|
• |
Cloud Managed Services are focused on helping our customers consume public cloud in a way that reduces time-to-market for new applications, lowers their ongoing cloud costs, and increases
security. By taking day-to-day cloud management off their hands, our clients can focus on the applications that drive their business.
|
• |
Managed Security Services help customers strengthen their information security profile with industry-leading tools, technology, and expertise - often at a fraction of the cost of in-house security
resources. Services include Security Operations Center (SOC), Vulnerability Management, Managed Detection and Response (MDR), and Incident Response (IR).
|
• |
Professional services focus on cloud infrastructure, unified communications, collaboration, networking, storage, hyper-converged infrastructure, and virtual desktop infrastructure, supported by
security and managed services solutions.
|
• |
Staff augmentation services provide customers with flexible headcount options, which may range from service desk to infrastructure to software developer skills. Staff augmentation allows
customers to access talent, fill specific technology skill gaps, or provide short-term or long-term IT professional help, which also includes services, such as Virtual Chief Information Officer (vCIO) and Virtual Chief Information Security
Officer (vCISO), used to complement existing personnel and build three-to-five-year IT roadmaps.
|
• |
Project management services enhance productivity and collaboration management and enable successful implementations and adoption of
solutions for our customers.
|
• |
Cloud Consulting Services is a global team of architects and consultants focused on assessing customer workloads for cloud, assisting
with the selection of the appropriate cloud solution, design and build of cloud platforms, application modernization and migration, automation, and ongoing management and optimization of cloud platforms.
|
• |
Consulting Services helps customers strategize ways to ensure their business has maximum agility. By leveraging our extensive portfolio of Consulting Services, customers will gain
technology-driven insight and guidance to make smarter decisions, to improve efficiencies, maximize return on technology investments, and provide actionable intelligence.
|
• |
Security solutions help safeguard our customers’ business and information assets, including:
|
o |
Governance, Risk, and Compliance (GRC) services help ensure customers are meeting governance and compliance requirements by leveraging regulatory frameworks, industry best practices, and supporting controls, thereby allowing customers to
effectively identify, assess, and mitigate risk.
|
o |
Technology Introduction and Deployment services help customers rapidly adopt and integrate key security controls and embrace efficiencies across technology types like network, endpoint, data, and cloud.
|
• |
Front-end processing, such as procurement, order aggregation, order automation, vendor performance measurement, ordering, reconciliation, and payment.
|
• |
Lifecycle and asset ownership services, including asset management, change management, and property tax filing.
|
• |
End-of-life services such as equipment audit, removal, and disposal.
|
As of March 31,
|
|||||
2024
|
2023
|
Change
|
|||
Sales and marketing
|
719
|
644
|
75
|
||
Professional services
|
816
|
750
|
66
|
||
Administration
|
359
|
354
|
5
|
||
Executive management
|
6
|
6
|
-
|
||
Total
|
1,900
|
1,754
|
146
|
• |
changes in financial estimates by any securities analysts who follow our common stock, and our failure to meet these estimates or failure of securities;
|
• |
our failure to obtain our financial guidance estimates;
|
• |
significant variations in our quarterly results of operations;
|
• |
analysts to maintain coverage of our common stock;
|
• |
downgrades by any securities analysts who follow our common stock;
|
• |
future sales of our common stock by our officers, directors, and significant stockholders;
|
• |
market conditions or trends in our industry or the economy as a whole including market expectations of changes in interest rates;
|
• |
investors’ perceptions of our prospects;
|
• |
announcements by us or our competitors of significant contracts, acquisitions, joint ventures, or capital commitments; and
|
• |
changes in key personnel.
|
ITEM 1B. |
UNRESOLVED STAFF COMMENTS
|
ITEM 1C. |
CYBERSECURITY
|
ITEM 2. |
PROPERTIES
|
ITEM 3. |
LEGAL PROCEEDINGS
|
ITEM 4. |
MINE SAFETY DISCLOSURES
|
ITEM 5. |
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
|
Period
|
Total
number of shares purchased
(1)
|
Average
price paid
per share
|
Total number of
shares purchased
as part of
publicly
announced plans
or programs
|
Maximum
number of shares
that may yet be
purchased under
the plans or
programs (2)
|
||||||||||||
January 1, 2024 through January 31, 2024
|
-
|
$
|
-
|
-
|
956,602
|
|||||||||||
February 1, 2024 through February 28, 2024
|
574
|
$
|
64.89
|
574
|
956,028
|
|||||||||||
March 1, 2024 through March 31, 2024
|
-
|
$
|
-
|
-
|
956,028
|
|||||||||||
Total
|
574
|
574
|
(1) |
All shares were acquired in open-market purchases.
|
(2) |
The amounts presented in this column are the remaining number of shares that may be repurchased after repurchases during the month. On March 22, 2023, our Board authorized the repurchase of up to 1,000,000 shares of our outstanding
common stock, over a 12-month period beginning May 28, 2023.
|
ITEM 6. |
[RESERVED]
|
ITEM 7. |
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
• |
General economic concerns including inflation, rising interest rates, staffing shortages, remote work trends, and geopolitical concerns may impact our customers’ willingness to spend on technology and services.
|
• |
We are experiencing increases in prices from our suppliers. While we generally have been able to pass price increases to our customers, inflation could have a material impact on our sales, gross profit, or
operating costs in the future. Our financing quotes are generally indexed to market rates to enable us to change rates from time of quote to funding. Financing transactions funded with our cash flows, not debt, are subject to interest rate
risk. If the market interest rate exceeds our internal rate of return, we may not fund the transaction to obtain the proceeds and lock in our profit on the transaction. Also, we are experiencing constriction of funds available and more
stringent assessment for our financing arrangements from our lender partners.
|
• |
Our customers’ top focus areas include AI, security, cloud solutions, hybrid work environments (work from home, work from anywhere, and return to office), as well as digital transformation and modernization. We
have developed advisory services, assessments, solutions, and professional and managed services to meet these priorities and help our customers attain and maintain their desired outcome.
|
• |
Modernizing legacy applications, data modernization, reducing operational complexity, securing workloads, the cost and performance of IT operations, and agility are changing the way companies are purchasing and
consuming technology. These are fueling deployments of solutions on cloud, managed services and hybrid platforms and licensing models, which may include invoicing over the term of the agreement.
|
• |
Rapid cloud adoption has led to customer challenges around increasing costs, security concerns, and skillset gaps. These challenges are consistent across all industries and business sizes. We have developed a
Cloud Managed Services portfolio to address these needs, allowing our clients to focus on driving business outcomes via optimized and secure cloud platforms.
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Consolidated
|
||||||||||||
Financial Metrics
|
||||||||||||
Net sales
|
$
|
2,225,302
|
$
|
2,067,718
|
$
|
1,821,019
|
||||||
Gross profit
|
$
|
550,793
|
$
|
517,524
|
$
|
460,982
|
||||||
Gross margin
|
24.8
|
%
|
25.0
|
%
|
25.3
|
%
|
||||||
Operating income margin
|
7.1
|
%
|
8.0
|
%
|
8.1
|
%
|
||||||
Net earnings
|
$
|
115,776
|
$
|
119,356
|
$
|
105,600
|
||||||
Net earnings margin
|
5.2
|
%
|
5.8
|
%
|
5.8
|
%
|
||||||
Net earnings per common share - diluted
|
$
|
4.33
|
$
|
4.48
|
$
|
3.93
|
||||||
Non-GAAP Financial Metrics
|
||||||||||||
Non-GAAP: Net earnings (1)
|
$
|
131,327
|
$
|
133,931
|
$
|
117,964
|
||||||
Non-GAAP: Net earnings per common share - diluted (1)
|
$
|
4.92
|
$
|
5.02
|
$
|
4.39
|
||||||
Adjusted EBITDA (2)
|
$
|
190,441
|
$
|
190,592
|
$
|
170,004
|
||||||
Adjusted EBITDA margin (2)
|
8.6
|
%
|
9.2
|
%
|
9.3
|
%
|
||||||
Technology business segments
|
||||||||||||
Financial Metrics
|
||||||||||||
Net sales
|
||||||||||||
Product
|
$
|
1,883,809
|
$
|
1,750,802
|
$
|
1,492,411
|
||||||
Professional services
|
154,549
|
151,785
|
146,747
|
|||||||||
Managed services
|
137,528
|
112,658
|
93,878
|
|||||||||
Total
|
$
|
2,175,886
|
$
|
2,015,245
|
$
|
1,733,036
|
||||||
Gross profit
|
||||||||||||
Product
|
$
|
397,618
|
$
|
380,741
|
$
|
316,622
|
||||||
Professional services
|
68,194
|
61,594
|
63,384
|
|||||||||
Managed services
|
42,667
|
32,155
|
28,147
|
|||||||||
Total
|
$
|
508,479
|
$
|
474,490
|
$
|
408,153
|
||||||
Gross margin
|
||||||||||||
Product
|
21.1
|
%
|
21.7
|
%
|
21.2
|
%
|
||||||
Professional services
|
44.1
|
%
|
40.6
|
%
|
43.2
|
%
|
||||||
Managed services
|
31.0
|
%
|
28.5
|
%
|
30.0
|
%
|
||||||
Total
|
23.4
|
%
|
23.5
|
%
|
23.6
|
%
|
||||||
Operating income
|
$
|
132,560
|
$
|
140,110
|
$
|
109,000
|
||||||
Non-GAAP Financial Metric
|
||||||||||||
Adjusted EBITDA (2)
|
$
|
164,409
|
$
|
164,184
|
$
|
131,353
|
||||||
Operational Metrics
|
||||||||||||
Gross billings (3)
|
||||||||||||
Networking
|
$
|
1,172,274
|
$
|
927,319
|
$
|
709,687
|
||||||
Cloud
|
824,128
|
892,308
|
828,002
|
|||||||||
Security
|
625,392
|
639,416
|
476,339
|
|||||||||
Collaboration
|
120,960
|
127,027
|
131,941
|
|||||||||
Other
|
262,439
|
282,748
|
240,586
|
|||||||||
Product gross billings
|
3,005,193
|
2,868,818
|
2,386,555
|
|||||||||
Service billings
|
324,571
|
277,070
|
239,194
|
|||||||||
Total gross billings
|
$
|
3,329,764
|
$
|
3,145,888
|
$
|
2,625,749
|
||||||
Financing business segment
|
||||||||||||
Financial Metrics
|
||||||||||||
Net sales
|
$
|
49,416
|
$
|
52,473
|
$
|
87,983
|
||||||
Gross profit
|
$
|
42,314
|
$
|
43,034
|
$
|
52,829
|
||||||
Operating income
|
$
|
25,697
|
$
|
26,052
|
$
|
38,316
|
||||||
Non-GAAP Financial Metric
|
||||||||||||
Adjusted EBITDA (2)
|
$
|
26,032
|
$
|
26,408
|
$
|
38,651
|
(1) |
Non-GAAP: Net earnings and Non-GAAP: Net earnings per common share – diluted are based on net earnings calculated in accordance with US GAAP, adjusted to exclude other (income) expense, share-based compensation, and acquisition and
integration expenses, and the related tax effects.
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
GAAP: Earnings before tax
|
$
|
161,093
|
$
|
162,974
|
$
|
146,884
|
||||||
Share-based compensation
|
9,731
|
7,824
|
7,114
|
|||||||||
Acquisition related amortization expense
|
15,180
|
9,411
|
10,072
|
|||||||||
Other (income) expense
|
(2,836
|
)
|
3,188
|
432
|
||||||||
Non-GAAP: Earnings before provision for income taxes
|
183,168
|
183,397
|
164,502
|
|||||||||
GAAP: Provision for income taxes
|
45,317
|
43,618
|
41,284
|
|||||||||
Share-based compensation
|
2,772
|
2,104
|
2,014
|
|||||||||
Acquisition related amortization expense
|
4,306
|
2,527
|
2,803
|
|||||||||
Other (income) expense
|
(831
|
)
|
950
|
120
|
||||||||
Tax benefit (expense) on restricted stock
|
277
|
267
|
317
|
|||||||||
Non-GAAP: Provision for income taxes
|
51,841
|
49,466
|
46,538
|
|||||||||
Non-GAAP: Net earnings
|
$
|
131,327
|
$
|
133,931
|
$
|
117,964
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
GAAP: Net earnings per common share - diluted
|
$
|
4.33
|
$
|
4.48
|
$
|
3.93
|
||||||
Share-based compensation
|
0.27
|
0.21
|
0.20
|
|||||||||
Acquisition related amortization expense
|
0.40
|
0.26
|
0.26
|
|||||||||
Other (income) expense
|
(0.07
|
)
|
0.08
|
0.01
|
||||||||
Tax benefit (expense) on restricted stock
|
(0.01
|
)
|
(0.01
|
)
|
(0.01
|
)
|
||||||
Total non-GAAP adjustments - net of tax
|
0.59
|
0.54
|
0.46
|
|||||||||
Non-GAAP: Net earnings per common share - diluted
|
$
|
4.92
|
$
|
5.02
|
$
|
4.39
|
(2) |
We define Adjusted EBITDA as net earnings calculated in accordance with US GAAP, adjusted for the following: interest expense, depreciation and amortization, share-based compensation, acquisition and integration expenses, provision for
income taxes, and other (income) expense. Adjusted EBITDA presented for the technology business and the financing business segment is defined as operating income calculated in accordance with US GAAP, adjusted for interest expense,
share-based compensation, acquisition and integration expenses, and depreciation and amortization. We consider the interest on notes payable from our financing business segment and depreciation expense presented within cost of sales, which
includes depreciation on assets financed as operating leases, to be operating expenses. As such, they are not included in the amounts added back to net earnings in the Adjusted EBITDA calculation. In the table below, we provide a
reconciliation of Adjusted EBITDA to net earnings, which is the most directly comparable financial measure to this non-GAAP financial measure. Adjusted EBITDA margin is our calculation of Adjusted EBITDA divided by net sales.
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Consolidated
|
||||||||||||
Net earnings
|
$
|
115,776
|
$
|
119,356
|
$
|
105,600
|
||||||
Provision for income taxes
|
45,317
|
43,618
|
41,284
|
|||||||||
Share-based compensation
|
9,731
|
7,824
|
7,114
|
|||||||||
Interest and financing costs
|
1,428
|
2,897
|
928
|
|||||||||
Depreciation and amortization
|
21,025
|
13,709
|
14,646
|
|||||||||
Other (income) expense
|
(2,836
|
)
|
3,188
|
432
|
||||||||
Adjusted EBITDA
|
$
|
190,441
|
$
|
190,592
|
$
|
170,004
|
||||||
Technology business segments
|
||||||||||||
Operating income
|
$
|
132,560
|
$
|
140,110
|
$
|
109,000
|
||||||
Depreciation and amortization
|
20,951
|
13,598
|
14,535
|
|||||||||
Share-based compensation
|
9,470
|
7,579
|
6,890
|
|||||||||
Interest and financing costs
|
1,428
|
2,897
|
928
|
|||||||||
Adjusted EBITDA
|
$
|
164,409
|
$
|
164,184
|
$
|
131,353
|
||||||
Financing business segment
|
||||||||||||
Operating income
|
$
|
25,697
|
$
|
26,052
|
$
|
38,316
|
||||||
Depreciation and amortization
|
74
|
111
|
111
|
|||||||||
Share-based compensation
|
261
|
245
|
224
|
|||||||||
Adjusted EBITDA
|
$
|
26,032
|
$
|
26,408
|
$
|
38,651
|
(3) |
Gross billings are the total dollar value of customer purchases of goods and services including shipping charges during the period, net of customer returns and credit memos, sales, or other taxes. Gross billings
include the transaction values for certain sales transactions that are recognized on a net basis, and, therefore, include amounts that will not be recognized as revenue.
|
• |
Product segment: Our product segment consists of the sale of third-party hardware, third-party perpetual and subscription software, and third-party maintenance, software assurance, and other third-party services.
The product segment also includes internet-based business-to-business supply chain management solutions for IT products.
|
• |
Professional services segment: Our professional services segment includes our advanced professional services to our customers that are performed under time and materials, fixed fee, or milestone contracts.
Professional services include consulting, assessments, configuration, logistic services, training, staff augmentation services, and project management services.
|
• |
Managed services segment: Our managed services segment includes our advanced managed services that encompass managing various aspects of our customers’ environments that are billed in regular intervals over a
contract term, usually between three to five years. Managed services also include security solutions, storage-as-a-service, cloud hosted services, cloud managed services, and service desk.
|
• |
Portfolio income: Interest income from financing receivables and rents due under operating leases.
|
• |
Transactional gains: Net gains or losses on the sale of financial assets.
|
• |
Post-contract earnings: Month-to-month rents; early termination, prepayment, make-whole, or buyout fees; and the sale of off-lease (used) equipment.
|
Year ended March 31,
|
||||||||||||||||
2024
|
2023
|
Change
|
Percent Change
|
|||||||||||||
Financial metrics
|
||||||||||||||||
Net sales
|
||||||||||||||||
Product
|
$
|
1,883,809
|
$
|
1,750,802
|
$
|
133,007
|
7.6
|
%
|
||||||||
Professional services
|
154,549
|
151,785
|
2,764
|
1.8
|
%
|
|||||||||||
Managed services
|
137,528
|
112,658
|
24,870
|
22.1
|
%
|
|||||||||||
Total
|
$
|
2,175,886
|
$
|
2,015,245
|
$
|
160,641
|
8.0
|
%
|
||||||||
Gross Profit
|
||||||||||||||||
Product
|
397,618
|
380,741
|
16,877
|
4.4
|
%
|
|||||||||||
Professional services
|
68,194
|
61,594
|
6,600
|
10.7
|
%
|
|||||||||||
Managed services
|
42,667
|
32,155
|
10,512
|
32.7
|
%
|
|||||||||||
Total
|
508,479
|
474,490
|
33,989
|
7.2
|
%
|
|||||||||||
Selling, general, and administrative
|
353,540
|
317,885
|
35,655
|
11.2
|
%
|
|||||||||||
Depreciation and amortization
|
20,951
|
13,598
|
7,353
|
54.1
|
%
|
|||||||||||
Interest and financing costs
|
1,428
|
2,897
|
(1,469
|
)
|
(50.7
|
%)
|
||||||||||
Operating expenses
|
375,919
|
334,380
|
41,539
|
12.4
|
%
|
|||||||||||
Operating income
|
$
|
132,560
|
$
|
140,110
|
$
|
(7,550
|
)
|
(5.4
|
%)
|
|||||||
Key metrics & other information
|
||||||||||||||||
Gross billings
|
$
|
3,329,764
|
$
|
3,145,888
|
$
|
183,876
|
5.8
|
%
|
||||||||
Adjusted EBITDA
|
$
|
164,409
|
$
|
164,184
|
$
|
225
|
0.1
|
%
|
||||||||
Product margin
|
21.1
|
%
|
21.7
|
%
|
||||||||||||
Professional services margin
|
44.1
|
%
|
40.6
|
%
|
||||||||||||
Managed services margin
|
31.0
|
%
|
28.5
|
%
|
||||||||||||
Net sales by customer end market:
|
||||||||||||||||
Telecom, media & entertainment
|
$
|
547,525
|
$
|
532,921
|
$
|
14,604
|
2.7
|
%
|
||||||||
Technology
|
379,720
|
393,594
|
(13,874
|
)
|
(3.5
|
%)
|
||||||||||
SLED
|
329,617
|
290,624
|
38,993
|
13.4
|
%
|
|||||||||||
Healthcare
|
278,893
|
274,936
|
3,957
|
1.4
|
%
|
|||||||||||
Financial services
|
243,630
|
156,257
|
87,373
|
55.9
|
%
|
|||||||||||
All others
|
396,501
|
366,913
|
29,588
|
8.1
|
%
|
|||||||||||
Total
|
$
|
2,175,886
|
2,015,245
|
160,641
|
8.0
|
%
|
||||||||||
Net sales by type:
|
||||||||||||||||
Networking
|
$
|
1,005,679
|
$
|
803,678
|
$
|
202,001
|
25.1
|
%
|
||||||||
Cloud
|
546,341
|
587,097
|
(40,756
|
)
|
(6.9
|
%)
|
||||||||||
Security
|
193,956
|
214,459
|
(20,503
|
)
|
(9.6
|
%)
|
||||||||||
Collaboration
|
65,714
|
57,472
|
8,242
|
14.3
|
%
|
|||||||||||
Other
|
72,119
|
88,096
|
(15,977
|
)
|
(18.1
|
%)
|
||||||||||
Total products
|
1,883,809
|
1,750,802
|
133,007
|
7.6
|
%
|
|||||||||||
Professional services
|
154,549
|
151,785
|
2,764
|
1.8
|
%
|
|||||||||||
Managed services
|
137,528
|
112,658
|
24,870
|
22.1
|
%
|
|||||||||||
Total
|
$
|
2,175,886
|
$
|
2,015,245
|
$
|
160,641
|
8.0
|
%
|
Year ended March 31,
|
||||||||||||||||
2024
|
2023
|
Change
|
Percent Change
|
|||||||||||||
Financial Metrics
|
||||||||||||||||
Portfolio earnings
|
$
|
13,937
|
$
|
11,356
|
$
|
2,581
|
22.7
|
%
|
||||||||
Transactional gains
|
19,016
|
16,125
|
2,891
|
17.9
|
%
|
|||||||||||
Post-contract earnings
|
14,301
|
23,581
|
(9,280
|
)
|
(39.4
|
%)
|
||||||||||
Other
|
2,162
|
1,411
|
751
|
53.2
|
%
|
|||||||||||
Net sales
|
$
|
49,416
|
$
|
52,473
|
$
|
(3,057
|
)
|
(5.8
|
%)
|
|||||||
Gross profit
|
42,314
|
43,034
|
(720
|
)
|
(1.7
|
%)
|
||||||||||
Selling, general, and administrative
|
14,194
|
15,635
|
(1,441
|
)
|
(9.2
|
%)
|
||||||||||
Depreciation and amortization
|
74
|
111
|
(37
|
)
|
(33.3
|
%)
|
||||||||||
Interest and financing costs
|
2,349
|
1,236
|
1,113
|
90.0
|
%
|
|||||||||||
Operating expenses
|
16,617
|
16,982
|
(365
|
)
|
(2.1
|
%)
|
||||||||||
Operating income
|
$
|
25,697
|
$
|
26,052
|
$
|
(355
|
)
|
(1.4
|
%)
|
|||||||
Key Metrics & Other Information
|
||||||||||||||||
Adjusted EBITDA
|
$
|
26,032
|
$
|
26,408
|
$
|
(376
|
)
|
(1.4
|
%)
|
Year Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Net cash provided by (used in) operating activities
|
$
|
248,449
|
$
|
(15,425
|
)
|
|||
Net cash used in investing activities
|
(61,964
|
)
|
(18,926
|
)
|
||||
Net cash used in financing activities
|
(36,619
|
)
|
(20,950
|
)
|
||||
Effect of exchange rate changes on cash
|
62
|
3,016
|
||||||
Net increase (decrease) in cash and cash equivalents
|
$
|
149,928
|
$
|
(52,285
|
)
|
Year Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Technology business segments
|
$
|
248,967
|
$
|
17,157
|
||||
Financing business segment
|
(518
|
)
|
(32,582
|
)
|
||||
Net cash provided by (used in) operating activities
|
$
|
248,449
|
$
|
(15,425
|
)
|
As of March 31,
|
|||
2024
|
2023
|
||
(DSO) Days sales outstanding (1)
|
62
|
74
|
|
(DIO) Days inventory outstanding (2)
|
23
|
38
|
|
(DPO) Days payable outstanding (3)
|
(39)
|
(53)
|
|
Cash conversion cycle
|
46
|
59
|
(1) |
Represents the rolling three-month average of the balance of trade accounts receivable-trade, net for our technology business segments at the end of the period divided by Gross billings for the same three-month period.
|
(2) |
Represents the rolling three-month average of the balance of inventory, net for our technology business segments at the end of the period divided by the direct cost of products and services billed to our customers for the same
three-month period.
|
(3) |
Represents the rolling three-month average of the combined balance of accounts payable-trade and accounts payable-floor plan for our technology business segments at the end of the period divided by the direct cost of products and
services billed to our customers for the same three-month period.
|
ITEM 7A. |
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
ITEM 8. |
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
|
ITEM 9. |
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
|
ITEM 9A. |
CONTROLS AND PROCEDURES
|
ITEM 9B. |
OTHER INFORMATION
|
ITEM 9C. |
DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS
|
ITEM 10. |
DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE
|
ITEM 11. |
EXECUTIVE COMPENSATION
|
ITEM 12. |
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
|
ITEM 13. |
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
|
ITEM 14. |
PRINCIPAL ACCOUNTING FEES AND SERVICES
|
ITEM 15. |
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
|
Exhibit No.
|
Exhibit Description
|
|
ePlus inc. Amended and Restated Certificate of Incorporation, as last amended November 9, 2021 (Incorporated herein by reference to Exhibit 3.1 to our Annual Report on Form
10-K for the period ended March 31, 2023).
|
||
Amended and Restated Bylaws of ePlus inc., as of March 2, 2022. (Incorporated herein by reference to Exhibit 3.2 to our Annual Report on Form 10-K for the fiscal year ended March 31, 2022).
|
||
Specimen Certificate of Common Stock (Incorporated herein by reference to Exhibit 4.1 to our Registration Statement on Form S-1 (File No. 333-11737) originally filed on September 11, 1996).
|
||
Description of ePlus inc.’s securities registered under Section 12 of the Securities Exchange Act of 1934 (Incorporated herein by reference to Exhibit 4.2 to our Annual
Report on Form 10-K for the fiscal year ended March 31, 2022).
|
||
Form of Indemnification Agreement entered into by and between ePlus and its directors and officers (Incorporated herein by reference to Exhibit 10.1 to our Current Report
on Form 8-K filed on August 23, 2016).
|
||
Amended and Restated Employment Agreement effective September 6, 2017, by and between ePlus inc. and Mark P. Marron (Incorporated herein by reference to Exhibit 10.1 to
our Quarterly Report on Form 10-Q for the period ended December 31, 2017).
|
||
Amendment #1, effective July 16, 2018, to Amended and Restated Employment Agreement effective September 6, 2017, by and between ePlus inc. and Mark P. Marron (Incorporated
herein by reference to Exhibit 10.2 to our Current Report on Form 8-K filed on July 18, 2018).
|
||
Amendment #2, effective November 14, 2019, to Amended and Restated Employment Agreement effective September 6, 2017, by and between ePlus inc. and Mark P. Marron
(Incorporated herein by reference to Exhibit 10.2 to our Quarterly Report on Form 10-Q for the period ended December 31, 2019).
|
||
Amended and Restated Employment Agreement effective September 6, 2017, by and between ePlus inc. and Elaine D. Marion (Incorporated herein by reference to Exhibit 10.3 to
our Quarterly Report on Form 10-Q for the period ended December 31, 2017).
|
||
Amendment #1, effective November 14, 2019, to Amended and Restated Employment Agreement, effective September 6, 2017, by and between ePlus inc. and Elaine D. Marion
(Incorporated herein by reference to Exhibit 10.1 to our Quarterly Report on Form 10-Q for the period ended December 31, 2019).
|
||
Employment Agreement, effective May 7, 2018, by and between ePlus inc. and Darren S. Raiguel (Incorporated herein by reference to Exhibit 10.1 to our Current Report on
Form 8-K filed on May 9, 2018).
|
||
Amendment No. 1, effective November 14, 2019, to Amended and Restated Employment Agreement, effective May 7, 2018, by and between ePlus inc. and Darren S Raiguel
(Incorporated herein by reference to Exhibit 10.3 to our Current Report on Form 10-Q filed on February 6, 2020).
|
||
ePlus inc. 2017 Non-Employee Director Long-Term Incentive Plan (updated to reflect the stock split effected December 13, 2021) as amended (Incorporated
herein by reference to Exhibit 10.6 to our Current Report on Form 10-Q for the period ended December 31, 2021).
|
ePlus inc. 2012 Employee Long-term Incentive Plan (updated to reflect stock split effected March 31, 2017) (Incorporated herein by reference to Exhibit 10.8 to our Annual
Report on Form 10-K for the fiscal year ended March 31, 2017).
|
||
ePlus inc. Cash Incentive Plan, effective April 1, 2018 (Incorporated herein by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on July 18, 2018).
|
||
ePlus 2021 Employee Long-Term Incentive Plan (updated to reflect the stock split effected December 13, 2021) as amended (Incorporated herein by reference to Exhibit 10.1 to our Current Report on
Form 10-Q for the period ended December 31, 2021).
|
||
ePlus inc. 2022 Employee Stock Purchase Plan (Incorporated herein by reference to Exhibit 10.1 to our Current Report on Form 8-K filed on September 20, 2022).
|
||
Form
of Restricted Stock Award Agreement (for awards granted to US employees under and subject to the provisions of the ePlus inc. 2021 Employee Long-Term Incentive Plan) (Incorporated herein by reference to Exhibit 10.1 to our Quarterly
Report on Form 10-Q for the period ended June 30, 2023).
|
||
Form
of Restricted Stock Award Agreement (for awards granted to U.K. employees under and subject to the provisions of the ePlus inc. 2021 Employee Long-Term Incentive Plan) (Incorporated herein by reference to Exhibit 10.2 to our Quarterly
Report on Form 10-Q for the period ended June 30, 2023).
|
||
Form
of Stock Agreement (for awards granted to non-employee directors under and subject to the provisions of the ePlus inc. 2017 Non-Employee Director Long-Term Incentive Plan) (Incorporated herein by reference to Exhibit 10.3 to our Quarterly
Report on Form 10-Q for the period ended June 30, 2023).
|
||
Form of Cash Performance Award Agreement (Incorporated herein by reference to Exhibit 10.1 to our Current Report on Form 8-K as filed with the Securities and Exchange Commission on November 22, 2023).
|
||
Form of Performance Stock Unit Award Notice and Award Agreement (Incorporated herein by reference to Exhibit 10.2 to our Current Report on Form 8-K as filed with the Securities and Exchange Commission on November 22, 2023).
|
||
First Amended and Restated Credit Agreement, dated as of October 13, 2021, by and among ePlus Technology, inc., ePlus Technology Services, inc., SLAIT
Consulting, LLC, certain of ePlus inc. subsidiaries as guarantors, Wells Fargo Commercial Distribution Finance, LLC as administrative agent and the Lenders party thereto (Incorporated herein by
reference to Exhibit 10.1 to our Current Report in Form 8-K filed on October 19, 2021). *
|
||
Guaranty and Security Agreement, dated as of October 13, 2021, by and among ePlus Technology, inc., ePlus Technology Services, inc., SLAIT Consulting,
LLC, certain future subsidiaries of ePlus inc., as guarantors, Wells Fargo Commercial Distribution Finance, LLC as administrative agent for the benefit of Secured Parties (Incorporated herein by
reference to Exhibit 10.2 to our Current Report on Form 8-K filed on October 19, 2021). *
|
||
First Amended and Restated Collateralized Guaranty, dated as of October 13, 2021, by and among ePlus Group, inc. and Wells Fargo Commercial Distribution Finance, LLC as agent for the benefit of
Secured Parties (Incorporated herein by reference to Exhibit 10.3 to our Current Report on Form 8-K filed on October 19, 2021). *
|
||
First Amended and Restated Limited Guaranty, dated as of October 13, 2021, by and between ePlus inc. and Wells
Fargo Commercial Distribution Finance, LLC as agent for the benefit of Secured Parties (Incorporated herein by reference to Exhibit 10.4 to our Current Report on Form 8-K filed on October 19, 2021). *
|
||
First Amendment to First Amended and Restated Credit Agreement, dated as of October 31, 2022, by and among ePlus Technology, inc., ePlus
Technology Services inc., SLAIT Consulting, LLC, certain of ePlus inc. subsidiaries as guarantors, Wells Fargo Commercial Distribution Finance, LLC as administrative agent and the Lenders party
thereto (Incorporated herein by reference to Exhibit 10.2 to our Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, filed on November 3, 2022). *
|
Second Amendment to First Amended and Restated Credit Agreement, dated as of March 10, 2023, by and among ePlus
Technology, inc., ePlus Technology Services inc., SLAIT Consulting, LLC, certain of ePlus inc. subsidiaries as guarantors, Wells Fargo Commercial Distribution Finance, LLC as administrative agent and the Lenders party thereto (Incorporated herein by reference to Exhibit 10.1 to our Current Report
on Form 8-K filed on March 14, 2023). *
|
||
10.25 |
Form of Restricted Stock Award Agreement (for awards granted to non-employee directors under and subject to the provisions of the ePlus inc. 2017 Non-Employee Director Long-Term Incentive Plan) (filed herewith).
|
|
Insider Trading Policy (filed herewith).
|
||
Subsidiaries of ePlus inc. (filed herewith).
|
||
Consent of Independent Registered Public Accounting Firm (filed herewith).
|
||
Certification of the Chief Executive Officer of ePlus inc. pursuant to the Securities Exchange Act Rules 13a-14(a) and 15d-14(a) (filed herewith).
|
||
Certification of the Chief Financial Officer of ePlus inc. pursuant to the Securities Exchange Act Rules 13a-14(a) and 15d-14(a) (filed herewith).
|
||
Certification of the Chief Executive Officer and Chief Financial Officer of ePlus inc. pursuant to 18 U.S.C. § 1350 (furnished herewith).
|
||
Policy for Recoupment of Incentive Compensation, effective as of November 17, 2023 (filed herewith).
|
||
101.INS
|
Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document)
|
|
101.SCH
|
Inline XBRL Taxonomy Extension Schema Document
|
|
101.CAL
|
Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
101.DEF
|
Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
101.LAB
|
Inline XBRL Taxonomy Extension Label Linkbase Document
|
|
101.PRE
|
Inline XBRL Taxonomy Extension Presentation Linkbase Document
|
|
104
|
Cover Page Interactive Data File (embedded within the Exhibit 101 Inline XBRL document)
|
ITEM 16. |
FORM 10-K SUMMARY
|
ePlus inc.
|
|
/s/ MARK P. MARRON
|
|
By: Mark P. Marron
|
|
Chief Executive Officer and President
|
|
Date: May 22, 2024
|
/s/ MARK P. MARRON
|
|
By: Mark P. Marron
|
|
Chief Executive Officer, President, and Director
|
|
(Principal Executive Officer) | |
Date: May 22, 2024
|
|
/s/ ELAINE D. MARION
|
|
By: Elaine D. Marion, Chief Financial Officer
|
|
(Principal Financial and Accounting Officer)
|
|
Date: May 22, 2024
|
|
/s/ RENEE BERGERON
|
|
By: Renée Bergeron, Director
|
|
Date: May 22, 2024
|
|
/s/ BRUCE M. BOWEN
|
|
By: Bruce M. Bowen, Director | |
Date: May 22, 2024 | |
/s/ JOHN E. CALLIES
|
|
By: John E. Callies, Director
|
|
Date: May 22, 2024
|
|
/s/ C. THOMAS FAULDERS, III
|
|
By: C. Thomas Faulders, III, Chairman
|
|
Date: May 22, 2024
|
|
/s/ IRA A. HUNT
|
|
By: Ira A. Hunt, Director
|
|
Date: May 22, 2024
|
|
/s/ MAUREEN F. MORRISON
|
|
By: Maureen F. Morrison, Director
|
|
Date: May 22, 2024
|
|
/s/ BEN XIANG
|
|
By: Ben Xiang, Director
|
|
Date: May 22, 2024
|
PAGE
|
|
F-2
|
|
F-5
|
|
F-6
|
|
F-7
|
|
F-8
|
|
F-10
|
|
F-11
|
• |
We tested the design and operating effectiveness of management’s controls over the determination of gross or net recognition of third-party software and support sales.
|
• |
For a selection of contracts, we performed the following procedures:
|
– |
Inspected the customer invoice and purchase order to determine whether the sale represented a valid transaction with a customer.
|
– |
Compared the cost per the Company’s records to the cost per the vendor invoice.
|
– |
Evaluated the sale to determine whether it constituted a single or multiple performance obligation(s) through inspection of the customer invoice, purchase order, and information on vendor websites accessed through third-party search
engines.
|
– |
Evaluated the sale to determine whether there was accompanying third-party support related to the software, and whether the support was separately identifiable or essential to the functionality of the software through inspection of
customer invoices, purchase orders, information on vendor websites accessed through third-party search engines and inquiries with management, as necessary.
|
• |
We tested the design and operating effectiveness of management’s controls over the transfer of financial assets, including management’s controls over the evaluation of the terms of loan documents and accompanying investor data,
assignment agreements, and the calculation of the gain or loss.
|
• |
For a selection of transactions, we evaluated the Company’s determination of sale or secured borrowing, by evaluating, among other factors, if the transferred assets have been isolated from the Company. Specifically, we performed the
following procedures:
|
– |
Obtained the executed transfer agreement and evaluated whether the Company:
|
■ |
Assigned its rights, titles, interests, estates, claims, and demands to the third-party assignee.
|
■ |
Retained any rights with respect to the payments assigned to the third-party assignee or had been appropriately isolated from the assets. We evaluated opinions from outside legal counsel, when applicable.
|
– |
Obtained and inspected the cash proceeds support from the transfer and compared the cash received to the selling price.
|
– |
Tested the mathematical accuracy of management’s calculation of the gain or loss based on the cash proceeds and the receivable balance as of date of sale.
|
March 31, 2024
|
March 31, 2023
|
|||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$
|
|
$
|
|
||||
Accounts receivable—trade, net
|
|
|
||||||
Accounts receivable—other, net
|
|
|
||||||
Inventories
|
|
|
||||||
Financing receivables—net, current
|
|
|
||||||
Deferred costs
|
|
|
||||||
Other current assets
|
|
|
||||||
Total current assets
|
|
|
||||||
Financing receivables and operating leases—net
|
|
|
||||||
Deferred tax asset
|
|
|
||||||
Property, equipment, and other assets—net
|
|
|
||||||
Goodwill
|
|
|
||||||
Other intangible assets—net
|
|
|
||||||
TOTAL ASSETS
|
$
|
|
$
|
|
||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
||||||||
LIABILITIES
|
||||||||
Current liabilities:
|
||||||||
Accounts payable
|
$
|
|
$
|
|
||||
Accounts payable—floor plan
|
|
|
||||||
Salaries and commissions payable
|
|
|
||||||
Deferred revenue
|
|
|
||||||
Recourse notes payable—current
|
|
|
||||||
Non-recourse notes payable—current
|
|
|
||||||
Other current liabilities
|
|
|
||||||
Total current liabilities
|
|
|
||||||
Non-recourse notes payable - long-term
|
|
|
||||||
Deferred tax liability
|
||||||||
Other liabilities
|
|
|
||||||
TOTAL LIABILITIES
|
|
|
||||||
COMMITMENTS AND CONTINGENCIES (Note
10)
|
||||||||
STOCKHOLDERS’ EQUITY
|
||||||||
Preferred stock, $
|
|
|
||||||
Common stock, $
|
|
|
||||||
Additional paid-in capital
|
|
|
||||||
Treasury stock, at cost,
|
(
|
)
|
(
|
)
|
||||
Retained earnings
|
|
|
||||||
Accumulated other comprehensive income—foreign currency translation adjustment
|
|
|
||||||
Total Stockholders’ Equity
|
|
|
||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Net sales
|
||||||||||||
Product
|
$
|
|
$
|
|
$
|
|
||||||
Services
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
Cost of sales
|
||||||||||||
Product
|
|
|
|
|||||||||
Services
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
Gross profit
|
|
|
|
|||||||||
Selling, general, and administrative
|
|
|
|
|||||||||
Depreciation and amortization
|
|
|
|
|||||||||
Interest and financing costs
|
|
|
|
|||||||||
Operating expenses
|
|
|
|
|||||||||
Operating income
|
|
|
|
|||||||||
Other income (expense), net
|
|
(
|
)
|
(
|
)
|
|||||||
Earnings before tax
|
|
|
|
|||||||||
Provision for income taxes
|
|
|
|
|||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
Net earnings per common share—basic
|
$
|
|
$
|
|
$
|
|
||||||
Net earnings per common share—diluted
|
$
|
|
$
|
|
$
|
|
||||||
Weighted average common shares outstanding—basic
|
|
|
|
|||||||||
Weighted average common shares outstanding—diluted
|
|
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
NET EARNINGS
|
$
|
|
$
|
|
$
|
|
||||||
OTHER COMPREHENSIVE INCOME, NET OF TAX:
|
||||||||||||
Foreign currency translation adjustments
|
|
|
(
|
)
|
||||||||
Other comprehensive income (loss)
|
|
|
(
|
)
|
||||||||
TOTAL COMPREHENSIVE INCOME
|
$
|
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Cash flows from operating activities:
|
||||||||||||
Net earnings
|
$
|
|
$
|
|
$
|
|
||||||
Adjustments to reconcile
net earnings to net cash provided by (used in) operating activities:
|
||||||||||||
Depreciation and amortization
|
|
|
|
|||||||||
Provision for credit losses
|
|
|
(
|
)
|
||||||||
Share-based compensation expense
|
|
|
|
|||||||||
Deferred taxes
|
(
|
)
|
|
(
|
)
|
|||||||
Payments from lessees directly to lenders—operating leases
|
|
|
(
|
)
|
||||||||
Gain on disposal of property, equipment, and operating lease equipment
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Changes in:
|
||||||||||||
Accounts receivable
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Inventories
|
|
(
|
)
|
(
|
)
|
|||||||
Financing receivables—net
|
(
|
)
|
(
|
)
|
|
|||||||
Deferred costs and other assets
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Accounts payable—trade
|
|
|
(
|
)
|
||||||||
Salaries and commissions payable, deferred revenue, and other liabilities
|
|
|
|
|||||||||
Net cash provided by (used in) operating activities
|
|
(
|
)
|
(
|
)
|
|||||||
Cash flows from investing activities:
|
||||||||||||
Proceeds from sale of property, equipment, and operating lease equipment
|
|
|
|
|||||||||
Purchases of property, equipment, and operating lease equipment
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Cash used in acquisitions, net of cash acquired
|
(
|
)
|
(
|
)
|
|
|||||||
Net cash used in investing activities
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Cash flows from financing activities:
|
||||||||||||
Borrowings of non-recourse and recourse notes payable
|
|
|
|
|||||||||
Repayments of non-recourse and recourse notes payable
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Proceeds from issuance of common stock
|
||||||||||||
Repurchase of common stock
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Net borrowings (repayments) on floor plan facility
|
(
|
)
|
(
|
)
|
|
|||||||
Net cash provided by (used in) financing activities
|
(
|
)
|
(
|
)
|
|
|||||||
Effect of exchange rate changes on cash
|
|
|
|
|||||||||
Net increase (decrease) in cash and cash equivalents
|
|
(
|
)
|
|
||||||||
Cash and cash equivalents, beginning of period
|
|
|
|
|||||||||
Cash and cash equivalents, end of period
|
$
|
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Supplemental disclosures of cash flow information:
|
||||||||||||
Cash paid for interest
|
$
|
|
$
|
|
$
|
|
||||||
Cash paid for income taxes
|
$
|
|
$
|
|
$
|
|
||||||
Cash paid for amounts included in the measurement of lease liabilities
|
$
|
|
$
|
|
$
|
|
||||||
Schedule of non-cash investing and financing activities:
|
||||||||||||
Proceeds from sale of property, equipment, and leased equipment
|
$
|
|
$
|
|
$
|
|
||||||
Purchases of property, equipment, and operating lease equipment
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
(
|
)
|
|||
Consideration for acquisitions
|
$ |
( |
) | |||||||||
Borrowing of non-recourse and recourse notes payable
|
$
|
|
$
|
|
$
|
|
||||||
Repayments of non-recourse and recourse notes payable
|
$
|
|
$
|
|
$
|
(
|
)
|
|||||
Debt derecognized due to sales of financial assets
|
$ |
( |
) | $ |
( |
) | $ |
( |
) | |||
Vesting of share-based compensation
|
$
|
|
$
|
|
$
|
|
||||||
Repurchase of common stock
|
$ | $ | ( |
) | $ | |||||||
New operating lease assets obtained in exchange for lease obligations
|
$
|
|
$
|
|
$
|
|
Accumulated | ||||||||||||||||||||||||||||
Additional | Other | |||||||||||||||||||||||||||
Common Stock |
Paid-In | Treasury | Retained | Comprehensive | ||||||||||||||||||||||||
Shares
|
Par Value
|
Capital
|
Stock
|
Earnings
|
Income
|
Total
|
||||||||||||||||||||||
Balance, March 31, 2021
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Issuance of restricted stock awards
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Share-based compensation
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Repurchase of common stock
|
(
|
)
|
|
|
(
|
)
|
|
|
(
|
)
|
||||||||||||||||||
Stock split effected in the form of a dividend
|
- | ( |
) | |||||||||||||||||||||||||
Retirement of treasury stock |
- | ( |
) | ( |
) | |||||||||||||||||||||||
Net earnings
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Foreign currency translation adjustment
|
-
|
|
|
|
|
(
|
)
|
(
|
)
|
|||||||||||||||||||
Balance, March 31, 2022
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||||
Issuance of restricted stock awards
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Share-based compensation
|
|
|
|
|
|
|
|
|||||||||||||||||||||
Repurchase of common stock
|
(
|
)
|
|
|
(
|
)
|
|
|
(
|
)
|
||||||||||||||||||
Net earnings
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Foreign currency translation adjustment
|
-
|
|
|
|
|
|
|
|||||||||||||||||||||
Balance, March 31, 2023
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
|
||||||||||||||
Issuance of restricted stock awards
|
( |
) | ||||||||||||||||||||||||||
Issuance of common stock |
||||||||||||||||||||||||||||
Share-based compensation
|
||||||||||||||||||||||||||||
Repurchase of common stock
|
( |
) | ( |
) | ( |
) | ||||||||||||||||||||||
Net earnings
|
- | |||||||||||||||||||||||||||
Foreign currency translation adjustment
|
- | |||||||||||||||||||||||||||
Balance, March 31, 2024
|
$ | $ | $ | ( |
) | $ | $ | $ |
● |
Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities that the reporting entity can access at the measurement date.
|
● |
Level 2 – Inputs other than quoted prices included within Level 1, such as quoted prices for similar assets or liabilities in active markets, that are
observable for the asset or liability, either directly or indirectly.
|
● |
Level 3 – Unobservable inputs for the asset or liability. The fair values are determined based on model-based techniques such as discounted cash flow models
using inputs that we could not corroborate with market data.
|
March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Current (included in deferred revenue)
|
$
|
|
$
|
|
$
|
|
||||||
Non-current (included in other liabilities)
|
$
|
|
$
|
|
$
|
|
|
$ |
|
||
|
|
|||
|
|
|||
|
|
|||
|
|
|||
Total remaining performance obligations
|
$
|
|
Year Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Net sales
|
$
|
|
$
|
|
||||
Cost of sales
|
|
|
||||||
Gross profit
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||
2024
|
2023
|
|||||||
Interest income on sales-type leases
|
$
|
|
$
|
|
||||
Lease income on operating leases
|
$
|
|
$
|
|
Notes | Sales-Type Lease | Financing | ||||||||||
March 31, 2024
|
Receivable
|
Receivables
|
Receivables
|
|||||||||
Gross receivables
|
$
|
|
$
|
|
$
|
|
||||||
Unguaranteed residual value (1)
|
|
|
|
|||||||||
Unearned income
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Allowance for credit losses (2)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total, net
|
$
|
|
$
|
|
$
|
|
||||||
Reported as:
|
||||||||||||
Current
|
$
|
|
$
|
|
$
|
|
||||||
Long-term
|
|
|
|
|||||||||
Total, net
|
$
|
|
$
|
|
$
|
|
(1) |
|
(2) |
|
Notes | Sales-Type Lease | Financing | ||||||||||
March 31, 2023
|
Receivable
|
Receivables
|
Receivables
|
|||||||||
Gross receivables
|
$
|
|
$
|
|
$
|
|
||||||
Unguaranteed residual value (1)
|
|
|
|
|||||||||
Unearned income
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Allowance for credit losses (2)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total, net
|
$
|
|
$
|
|
$
|
|
||||||
Reported as:
|
||||||||||||
Current
|
$
|
|
$
|
|
$
|
|
||||||
Long-term
|
|
|
|
|||||||||
Total, net
|
$
|
|
$
|
|
$
|
|
(1) |
|
(2) |
Refer to Note 7, “Allowance for Credit Losses” for details.
|
Year ending March 31, 2025
|
$
|
|
||
2026
|
|
|||
2027
|
|
|||
2028
|
|
|||
2029 | ||||
2030
and thereafter
|
|
|||
Total
|
$
|
|
March 31, 2024
|
March 31,2023
|
|||||||
Cost of equipment under operating leases
|
$
|
|
$
|
|
||||
Accumulated depreciation
|
(
|
)
|
(
|
)
|
||||
Operating leases—net (1)
|
$
|
|
$
|
|
(1) |
|
Year ending March 31, 2025
|
$
|
|
||
2026
|
|
|||
2027
|
|
|||
Total
|
$
|
|
Year Ended March 31,
|
||||||||
Lease term and Discount Rate
|
2024
|
2023
|
||||||
Weighted average remaining lease term (months)
|
|
|
||||||
Weighted average discount rate
|
|
%
|
|
%
|
Year ending March 31, 2025
|
$
|
|
||
2026
|
|
|||
2027
|
|
|||
2028
|
|
|||
2029
|
|
|||
Total lease payments
|
|
|||
Less: interest
|
(
|
)
|
||
Present value of lease liabilities
|
$
|
|
Technology |
Professional
|
Managed
|
||||||||||||||||||
Segment |
Product
|
Services
|
Services
|
Total
|
||||||||||||||||
Balance, March 31, 2022 (1)
|
$ | $ | $ | $ | $ | |||||||||||||||
Acquisitions
|
||||||||||||||||||||
Foreign currency translations
|
( |
) | ( |
) | ||||||||||||||||
Reporting unit change
|
( |
) | ||||||||||||||||||
Balance, March 31, 2023 (1)
|
$ | $ | $ | $ | $ | |||||||||||||||
Acquisitions
|
||||||||||||||||||||
Foreign currency translations
|
||||||||||||||||||||
Balance, March 31, 2024 (1) |
$ | $ | $ | $ | $ |
(1)
|
March 31, 2024
|
March 31, 2023
|
|||||||||||||||||||||||
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Net
Carrying
Amount
|
Gross
Carrying
Amount
|
Accumulated
Amortization
|
Net
Carrying
Amount
|
|||||||||||||||||||
Purchased intangibles
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||
Capitalized software development
|
|
(
|
)
|
|
|
(
|
)
|
|
||||||||||||||||
Total
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
Year ending March 31, 2025
|
$
|
|
||
2026
|
|
|||
2027
|
|
|||
2028
|
|
|||
2029
|
|
|||
2030 and thereafter
|
|
|||
Total
|
$
|
|
Accounts
Receivable
|
Notes
Receivable
|
Lease
Receivables
|
Total
|
|||||||||||||
Balance as of March 31, 2021
|
$ |
|
$ |
|
$ |
|
$ |
|
||||||||
Provision for credit losses
|
|
(
|
)
|
(
|
)
|
(
|
)
|
|||||||||
Write-offs and other
|
(
|
)
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||||
Balance as of March 31, 2022
|
|
|
|
|
||||||||||||
Provision for credit losses
|
|
|
|
|
||||||||||||
Write-offs and other
|
(
|
)
|
|
|
(
|
)
|
||||||||||
Balance as of March 31, 2023
|
|
|
|
|
||||||||||||
Provision for credit losses
|
|
|
|
|
||||||||||||
Write-offs and other
|
(
|
)
|
|
(
|
)
|
(
|
)
|
|||||||||
Balance as of March 31, 2024
|
$ |
|
$ |
|
$ |
|
$ |
|
• |
High CQR: This rating includes accounts with excellent to good business credit, asset quality and capacity to meet financial obligations. Loss rates in this
category are generally less than
|
• |
Average CQR: This rating includes accounts with average credit risk that are more susceptible to loss in the event of adverse business or economic conditions.
Loss rates in this category are in the range of
|
• |
Low CQR: This rating includes accounts that have marginal credit risk such that the customer’s ability to make repayment is impaired or may likely become
impaired. The loss rates in this category in the normal course are greater than
|
Amortized cost basis by origination year ending March 31,
|
||||||||||||||||||||||||||||||||||||
2024
|
2023
|
2022
|
2021
|
2020
|
2019
and prior
|
Total
|
Transfers
(2)
|
Net credit
exposure
|
||||||||||||||||||||||||||||
Notes receivable:
|
||||||||||||||||||||||||||||||||||||
High CQR
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||||||||
Average CQR
|
|
|
|
|
|
|
|
(
|
)
|
|
||||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||||||||
Lease receivables:
|
||||||||||||||||||||||||||||||||||||
High CQR
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||||||||
Average CQR
|
|
|
|
|
|
|
|
(
|
)
|
|
||||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||||||||||||
Total amortized cost (1)
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
(1) |
|
(2) |
|
Amortized cost basis by origination year ending March 31,
|
||||||||||||||||||||||||||||||||||||
2023
|
2022
|
2021
|
2020
|
2019
|
2018 and prior |
Total
|
Transfers
(2)
|
Net credit
exposure
|
||||||||||||||||||||||||||||
Notes receivable:
|
||||||||||||||||||||||||||||||||||||
High CQR
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$ |
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||||||||||
Average CQR
|
|
|
|
|
|
|
(
|
)
|
|
|||||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$ |
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||||||||||
Lease receivables:
|
||||||||||||||||||||||||||||||||||||
High CQR
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$ |
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||||||||||
Average CQR
|
|
|
|
|
|
|
(
|
)
|
|
|||||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$ |
$
|
|
$
|
(
|
)
|
$
|
|
||||||||||||||||||
Total amortized cost (1)
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$ |
$
|
|
$
|
(
|
)
|
$
|
|
(1) |
|
(2) |
|
31-60
Days Past
Due
|
61-90
Days Past
Due
|
> 90
Days Past
Due
|
Total
Past Due
|
Current
|
Total
Billed
|
Unbilled
|
Amortized
Cost
|
|||||||||||||||||||||||||
Notes receivable
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||
Lease receivables
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
31-60
Days Past
Due
|
61-90
Days Past
Due
|
> 90
Days Past
Due
|
Total
Past Due
|
Current
|
Total
Billed
|
Unbilled
|
Amortized
Cost
|
|||||||||||||||||||||||||
Notes receivable
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||||||||
Lease receivables
|
|
|
|
|
|
|
|
|
||||||||||||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
March 31, 2024
|
March 31, 2023 | |||||||
Furniture, fixtures, and equipment
|
$
|
|
$
|
|
||||
Leasehold improvements
|
|
|
||||||
Capitalized software
|
|
|
||||||
Vehicles
|
|
|
||||||
Total assets
|
|
|
||||||
Accumulated depreciation and amortization
|
(
|
)
|
(
|
)
|
||||
Property and equipment – net
|
$
|
|
$
|
|
Year ending March 31, 2025
|
$
|
|
||
2026
|
|
|||
2027
|
|
|||
2028
|
|
|||
Total maturities
|
$
|
|
2024
|
2023
|
2022
|
||||||||||
Net earnings attributable to common shareholders – basic and diluted
|
$
|
|
$
|
|
$
|
|
||||||
Basic and diluted common shares outstanding:
|
||||||||||||
Weighted average common shares outstanding – basic
|
|
|
|
|||||||||
Effect of dilutive shares
|
|
|
|
|||||||||
Weighted average shares common outstanding – diluted
|
|
|
|
|||||||||
Earnings per common share – basic
|
$
|
|
$
|
|
$
|
|
||||||
Earnings per common share – diluted
|
$
|
|
$
|
|
$
|
|
Number of
Shares
|
Weighted Average
Grant-Date Fair Value
|
|||||||
Nonvested April 1, 2023
|
|
$
|
|
|||||
Granted
|
|
$
|
|
|||||
Vested
|
(
|
)
|
$
|
|
||||
Forfeited
|
(
|
)
|
$
|
|
||||
Non-vested March 31, 2024
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Equity-based compensation expense
|
$
|
|
$
|
|
$
|
|
||||||
Income tax benefit
|
$ |
(
|
)
|
$ |
(
|
)
|
$ |
(
|
)
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Income tax expense computed at the US statutory federal rate
|
$
|
|
$
|
|
$
|
|
||||||
State income tax expense—net of federal benefit
|
|
|
|
|||||||||
Non-deductible executive compensation
|
|
|
|
|||||||||
Other
|
|
(
|
)
|
(
|
)
|
|||||||
Provision for income taxes
|
$
|
|
$
|
|
$
|
|
||||||
Effective income tax rate
|
|
%
|
|
%
|
|
%
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Current:
|
||||||||||||
Federal
|
$
|
|
$
|
|
$
|
|
||||||
State
|
|
|
|
|||||||||
Foreign
|
|
|
|
|||||||||
Total current expense
|
|
|
|
|||||||||
Deferred:
|
||||||||||||
Federal
|
(
|
)
|
|
(
|
)
|
|||||||
State
|
(
|
)
|
|
(
|
)
|
|||||||
Foreign
|
(
|
)
|
(
|
)
|
|
|||||||
Total deferred expense (benefit)
|
(
|
)
|
|
(
|
)
|
|||||||
Provision for income taxes
|
$
|
|
$
|
|
$
|
|
March 31,
|
||||||||
2024
|
2023
|
|||||||
Deferred tax assets:
|
||||||||
Accrued vacation
|
$
|
|
$
|
|
||||
Deferred revenue
|
|
|
||||||
Allowance for credit losses
|
|
|
||||||
Restricted stock
|
|
|
||||||
Other deferred tax assets
|
|
|
||||||
Accrued bonus
|
|
|
||||||
Lease liabilities
|
|
|
||||||
Other credits and carryforwards
|
|
|
||||||
Gross deferred tax assets
|
|
|
||||||
Less: valuation allowance
|
(
|
)
|
(
|
)
|
||||
Net deferred tax assets
|
|
|
||||||
Deferred tax liabilities:
|
||||||||
Property and equipment
|
(
|
)
|
(
|
)
|
||||
Operating leases
|
(
|
)
|
(
|
)
|
||||
Prepaid expenses
|
(
|
)
|
(
|
)
|
||||
Right-of-use assets
|
(
|
)
|
(
|
)
|
||||
Tax deductible goodwill
|
(
|
)
|
(
|
)
|
||||
Total deferred tax liabilities
|
(
|
)
|
(
|
)
|
||||
Net deferred tax asset
|
$
|
|
$
|
|
Fair Value Measurement Using
|
||||||||||||||||
Recorded
Amount
|
Quoted Prices in
Active Markets for
Identical Assets
(Level 1)
|
Significant Other
Observable Inputs
(Level 2)
|
Significant
Unobservable
Inputs (Level 3)
|
|||||||||||||
March 31, 2024
|
||||||||||||||||
Assets:
|
||||||||||||||||
Money market funds
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
March 31, 2023
|
||||||||||||||||
Assets:
|
||||||||||||||||
Money market funds
|
$
|
|
$
|
|
$
|
|
$
|
|
Acquisition Date Amount
|
||||
Accounts receivable
|
$
|
|
||
Other assets
|
|
|||
Identified intangible asset
|
|
|||
Accounts payable and other liabilities
|
(
|
)
|
||
Total identifiable net assets
|
|
|||
Goodwill
|
|
|||
Total purchase consideration
|
$
|
|
Acquisition Date Amount
|
||||
Accounts receivable
|
$
|
|
||
Other assets
|
|
|||
Identified intangible asset
|
|
|||
Accounts payable and other liabilities
|
(
|
)
|
||
Contract liabilities
|
(
|
)
|
||
Total identifiable net assets
|
|
|||
Goodwill
|
|
|||
Total purchase consideration
|
$
|
|
Acquisition Date Amount
|
||||
Accounts receivable
|
$
|
|
||
Other assets
|
|
|||
Identified intangible asset
|
|
|||
Accounts payable and other liabilities
|
(
|
)
|
||
Contract liabilities
|
(
|
)
|
||
Total identifiable net assets
|
|
|||
Goodwill
|
|
|||
Total purchase consideration
|
$
|
|
|
Year Ended March 31,
|
|||||||||||
|
2024
|
2023
|
2022
|
|||||||||
Net Sales
|
||||||||||||
Product
|
$
|
|
$
|
|
$
|
|
||||||
Professional services
|
|
|
|
|||||||||
Managed services
|
|
|
|
|||||||||
Financing
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
|
||||||||||||
Gross Profit
|
||||||||||||
Product
|
|
|
|
|||||||||
Professional services
|
|
|
|
|||||||||
Managed services
|
|
|
|
|||||||||
Financing
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
|
||||||||||||
Operating expenses
|
||||||||||||
Technology business
|
|
|
|
|||||||||
Financing
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
|
||||||||||||
Operating income
|
||||||||||||
Technology business
|
|
|
|
|||||||||
Financing
|
|
|
|
|||||||||
Total
|
|
|
|
|||||||||
|
||||||||||||
Other income (expense), net
|
|
(
|
)
|
(
|
)
|
|||||||
|
||||||||||||
Earnings before tax
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Depreciation and amortization
|
||||||||||||
Technology business
|
$
|
|
$
|
|
$
|
|
||||||
Financing
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Interest and financing costs
|
||||||||||||
Technology business
|
$
|
|
$
|
|
$
|
|
||||||
Financing
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
||||||
|
||||||||||||
Selected Financial Data - Statement of Cash Flow
|
||||||||||||
|
||||||||||||
Purchases of property, equipment, and operating lease equipment:
|
||||||||||||
Technology business
|
$
|
|
$
|
|
$
|
|
||||||
Financing
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
Year ended March 31, 2024
|
||||||||||||||||||||
Product
|
Professional
Services
|
Managed Services
|
Financing
|
Total
|
||||||||||||||||
Net Sales:
|
||||||||||||||||||||
Contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Financing and other
|
|
|
|
|
|
|||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Timing and position as principal or agent:
|
||||||||||||||||||||
Transferred at a point in time as principal
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Transferred at a point in time as agent
|
|
|
|
|
|
|||||||||||||||
Transferred over time as principal
|
|
|
|
|
|
|||||||||||||||
Total revenue from contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Year ended March 31, 2023
|
||||||||||||||||||||
Product
|
Professional
Services
|
Managed Services
|
Financing
|
Total
|
||||||||||||||||
Net Sales:
|
||||||||||||||||||||
Contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Financing and other
|
|
|
|
|
|
|||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Timing and position as principal or agent:
|
||||||||||||||||||||
Transferred at a point in time as principal
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Transferred at a point in time as agent
|
|
|
|
|
|
|||||||||||||||
Transferred over time as principal
|
|
|
|
|
|
|||||||||||||||
Total revenue from contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Year ended March 31, 2022
|
||||||||||||||||||||
Product
|
Professional
Services
|
Managed Services
|
Financing
|
Total
|
||||||||||||||||
Net Sales:
|
||||||||||||||||||||
Contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Financing and other
|
|
|
|
|
|
|||||||||||||||
Total
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Timing and position as principal or agent:
|
||||||||||||||||||||
Transferred at a point in time as principal
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||||
Transferred at a point in time as agent
|
|
|
|
|
|
|||||||||||||||
Transferred over time as principal
|
|
|
|
|
|
|||||||||||||||
Total revenue from contracts with customers
|
$
|
|
$
|
|
$
|
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Customer end market:
|
||||||||||||
Telecom, media & entertainment
|
$
|
|
$
|
|
$
|
|
||||||
Technology
|
|
|
|
|||||||||
SLED
|
|
|
|
|||||||||
Healthcare
|
|
|
|
|||||||||
Financial services
|
|
|
|
|||||||||
All others
|
|
|
|
|||||||||
Net sales
|
|
|
|
|||||||||
Less: revenue from financing and other
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total revenue from contracts with customers
|
$
|
|
$
|
|
$
|
|
||||||
Type:
|
||||||||||||
Product |
||||||||||||
Networking
|
$ |
|
$ |
|
$ |
|
||||||
Cloud |
||||||||||||
Security
|
|
|
|
|||||||||
Collaboration
|
|
|
|
|||||||||
Other
|
|
|
|
|||||||||
Total product
|
|
|
|
|||||||||
Professional services |
||||||||||||
Managed services |
||||||||||||
Net sales
|
|
|
|
|||||||||
Less: revenue from financing and other
|
(
|
)
|
(
|
)
|
(
|
)
|
||||||
Total revenue from contracts with customers
|
$
|
|
$
|
|
$
|
|
Year Ended March 31,
|
||||||||||||
2024
|
2023
|
2022
|
||||||||||
Net sales:
|
||||||||||||
US
|
$
|
|
$
|
|
$
|
|
||||||
Non-US
|
|
|
|
|||||||||
Total
|
$
|
|
$
|
|
$
|
|
March 31,
|
||||||||
2024
|
2023
|
|||||||
Long-lived tangible assets:
|
||||||||
US
|
$
|
|
$
|
|
||||
Non-US
|
|
|
||||||
Total
|
$
|
|
$
|
|
Balance at
Beginning of
Period
|
Charged to
Costs and
Expenses
|
Deductions/
Write-Offs
|
Balance at End
of Period
|
|||||||||||||
Allowance for sales returns: (1)
|
||||||||||||||||
Year ended March 31, 2022
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||
Year ended March 31, 2023
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||
Year ended March 31, 2024
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||
Allowance for credit losses:
|
||||||||||||||||
Year ended March 31, 2022
|
$
|
|
$
|
(
|
)
|
$
|
(
|
)
|
$
|
|
||||||
Year ended March 31, 2023
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||
Year ended March 31, 2024
|
$
|
|
$
|
|
$
|
(
|
)
|
$
|
|
|||||||
Valuation for deferred taxes:
|
||||||||||||||||
Year ended March 31, 2022
|
$
|
|
$
|
|
$
|
|
$
|
|
||||||||
Year ended March 31, 2023
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
|||||||
Year ended March 31, 2024
|
$
|
|
$
|
(
|
)
|
$
|
|
$
|
|
(1) |
|