8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

______________________________

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): March 3, 2009

______________________________

SYSTEMAX INC.

(Exact name of registrant as specified in its charter)

Delaware (State or other jurisdiction of incorporation) 1-13792 (Commission File Number) 11-3262067 (IRS Employer Identification No.)

11 Harbor Park Drive

Port Washington, New York 11050

(Address of principal executive offices)

(516) 608-7000

(Registrant’s telephone number, including area code)

N/A

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

£ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

£ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

£ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

£ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

A press release regarding fourth quarter and full year 2008 financial results was issued by the Company on March 3, 2009, a copy of which is filed as an exhibit.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

On March 3, 2009, the Board of Directors (the “Board”) of the Company increased the number of members of the Board from seven to eight and elected Mr. Lawrence P. Reinhold, Executive Vice President and Chief Financial Officer of the Company, to serve as a member of the Board.  Mr. Reinhold has served as the Executive Vice President and Chief Financial Officer of the Company since January 2007.

The Company’s policy is not to pay compensation to directors who are also employees of the Company or its subsidiaries.  Consequently, the Company has not entered into, or amended, any arrangement with Mr. Reinhold with respect to his appointment as a director of the Company.

Mr. Reinhold was not selected pursuant to any arrangement or understanding between Mr. Reinhold and any other person.  Mr. Reinhold will not serve as a member of any of the committees of the Board at this time.

A press release regarding the appointment of Mr. Reinhold as a member of the Board of the Company was issued by the Company on March 3, 2009, a copy of which is filed as an exhibit.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

99.1 Press Release of Systemax Inc., dated March 3, 2009, regarding financial results for fourth quarter and full year of 2008 and the appointment of Mr. Reinhold as a member of the Board of the Company.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

    SYSTEMAX INC.

    By:/s/ Curt Rush                                    

              Name: Curt Rush

              Title:   General Counsel and Secretary

Date:  March 4, 2009

Exhibit Index

99.1 Press Release of Systemax Inc., dated March 3, 2009, regarding financial results for fourth quarter and full year of 2008 and the appointment of Mr. Reinhold as a member of the Board of the Company.

EX-99.1

Exhibit 99.1

SYSTEMAX REPORTS FOURTH QUARTER AND FULL YEAR 2008 RESULTS

-- Net sales grow 6% in fourth quarter to a record $812.7 million; excluding the effect of

 exchange rates, sales up 11% --

PORT WASHINGTON, NY, March 3, 2009 – Systemax Inc. (NYSE:SYX) today announced financial results for the fourth quarter and full year ended December 31, 2008.

Financial highlights for the quarter ended December 31, 2008:

·   Consolidated net sales grew 6% to a record $812.7 million in U.S. dollars. Excluding the effect of exchange rate changes, sales would have grown 11%.

·   North American technology product sales grew 18% to a record $540.7 million in U.S. dollars.  Excluding the effect of exchange rate changes, sales would have grown over 19%.

·   European technology product sales were $216.9 million in U.S. dollars, a 14% decline.  Excluding the effect of exchange rate changes, sales would have declined by only 2%.

·   Gross profit reached a record $116.9 million and gross margin was 14.4%.

·   Operating income was $15.8 million and operating margin was 1.9%.

·   Net income was $10.0 million, or $0.27 per diluted share.

·   Cash and cash equivalents grew over 58% to $116 million during the quarter; undrawn line of credit remains at $120 million; total debt outstanding is $2.2 million and represents capital leases.

·   Common stock repurchases were 246,900 shares for $2.4 million or an average price of $9.67 per share.

Financial highlights for the year ended December 31, 2008:

·   Net sales grew 9% to a record $3.0 billion, driven by growth in both technology products and industrial products.  Excluding the effect of exchange rate changes, sales would have grown 8%.

·   North American technology product sales grew 14% to a record $1.9 billion in U.S. dollars.  Excluding exchange rate changes, sales would have grown 14%.

·   European technology product sales grew 1% to a record $940.6 million in U.S. dollars.  Excluding exchange rate changes, sales would have been flat.

·   Gross profit reached a record $464.1 million and gross margin was 15.3%.

·   Operating income was $83.4 million and operating margin was 2.7%.

·   Net income was $52.8 million, or $1.41 per diluted share.

·   Common stock repurchases were 475,301 shares for $5.8 million or an average price of $12.25 per share.

Richard Leeds, Chairman and Chief Executive Officer, said, “Systemax reported solid financial results despite the challenging economic climate, which significantly impacted spending on information technology and industrial products, in both the business to business and consumer markets.  Fourth quarter Technology Products revenues grew over 6%.  We are particularly pleased with performance in North America, which delivered a very strong quarter with over 19% growth, excluding exchange rate changes, driven primarily by our successful CompUSA business.  Our ability to move quickly and flexibly to capture value in the retail delivery chain and deliver it to consumers through our recognized businesses, including TigerDirect and CompUSA, helped drive this impressive top-line growth.”

Gilbert Fiorentino, Chief Executive of Systemax’s Technology Products business said, “During the quarter, we selectively lowered prices and offered special freight incentives to attract new customers, grow market share and position the Company for continued growth when the business environment improves.  While this had a short-term impact on gross margins, we believe it will position us very well with a larger customer base when consumer spending returns.”

“In addition to freight and margin concessions, we have been making aggressive investments in the retail side of our business as well as the web and technology infrastructure to capture market.  While the addition of CompUSA’s retail operations increased our spend in selling, general and administrative expenses, the enhancements we have made to our online and in-store operations continue to drive results, both in terms of revenue growth and positive customer feedback. We continue to roll-out our Retail 2.0 initiative, turning our brick and mortar locations into a destination for customers to test our products, research and compare prices and make educated buying decisions. By empowering consumers with information and self-service capability while offering superior value and selection, we believe we have a formula that will help us weather the economic slump while positioning us for long-term growth opportunities,” said Mr. Fiorentino.

Commenting on other operations, Mr. Leeds concluded, “While fourth quarter Industrial Products revenues were down slightly, revenues for the full year increased 5%, driven by the addition of over 100,000 new customers and 17,000 products to our revamped website.  We continue to reorganize and refocus our Software Solutions business, lowering our cost structure as we work to launch new customer sites with our ProfitCenter software.”

Working capital as of December 31, 2008 was $250.6 million, including cash and cash equivalents of $116.0 million.  The Company has an undrawn credit facility of $120.0 million and total cash and available liquidity of approximately $219.5 million. Cash flow from operations for the full year of 2008 was approximately $82.4 million.  Inventories increased nearly 13% to $282.2 million, as compared to $250.2 million at December 31, 2007. Inventories were up over 2% from the third quarter of 2008.  Capital expenditures for the full year 2008 aggregated $17.1 million and the Company expended $30.6 million for CompUSA.  The Company paid a dividend of $37.1 million during the second quarter.  The Company’s effective tax rate was 36.9% for the full year, up from 30.5% last year, principally the result of higher taxable income in the United Kingdom in 2008.

As a part of the two million share stock buyback program announced in May 2008, during the fourth quarter the Company purchased 246,900 shares, for approximately $2.4 million or an average price $9.67 per share. In total, the Company repurchased 475,301 shares of common stock during 2008 for $5.8 million or an average price of $12.25 per share.

The fourth quarter of 2008 included 14 weeks versus 13 weeks in 2007.  Average sales per day during the quarter were $8.3 million compared to $8.5 million in 2007.  The full year 2008 included 53 weeks versus 52 weeks in 2007.  Average sales per day during 2008 were $8.2 million compared to $7.7 million in 2007.

Board of Directors Appointment

The Company announced today that Larry Reinhold has been appointed to the Company’s Board of Directors.  Mr. Reinhold, 49, has served as the Company’s Executive Vice President and Chief Financial Officer since January 2007.  Prior to joining the Company, Mr. Reinhold served as Executive Vice President and Chief Financial Officer of Greatbatch, a NYSE medical technology company; as Executive Vice President and Chief Financial Officer of Critical Path, a NASDAQ software company; and as a partner with PricewaterhouseCoopers. He holds a BS in accounting and an MBA from San Diego State University. 

Commenting on the appointment Richard Leeds said, “Larry has been a valuable addition to our senior management team at Systemax.  We look forward to continuing to benefit from his extensive financial expertise and operational experience.”

Earnings Conference Call Details

Systemax Inc. will host a teleconference to discuss its fourth quarter and full year 2008 results today, Tuesday, March 3, 2009 at 5:00 p.m. Eastern Time. To access the teleconference, please dial 877-741-4251 (U.S. callers) or 719-325-4773 (Int’l callers) and reference passcode 8193145 ten minutes prior to the start time. The teleconferencing will also be available via live webcast on the Company’s Web site at www.systemax.com. A replay of the conference call will be available through Tuesday, March 10, 2009. It can be accessed by dialing 888-203-1112 (U.S. callers) or 719-457-0820 (Int’l callers), passcode 8193145. The webcast will also be archived on www.systemax.com for 30 days.

About Systemax Inc.

Systemax Inc. (www.systemax.com), a Fortune 1000 company, sells personal computers,

computer supplies and accessories, consumer electronics and industrial products through  branded e-commerce web sites, direct mail catalogs, relationship marketers and retail stores in North America and Europe. The primary brands are TigerDirect, CompUSA, Misco and Global Industrial. It also manufactures and sells computers and accessories under the Systemax and Ultra brands and develops and markets ProfitCenter Software, a web-based application for multichannel direct marketing companies.

Forward-Looking Statements

This press release contains forward-looking statements about the Company’s performance.  These statements are based on management’s estimates, assumptions and projections and are not guarantees of future performance.  The Company assumes no obligation to update these statements.  Actual results may differ materially from results expressed or implied in these statements as the result of risks, uncertainties and other factors including, but not limited to: (a) unanticipated variations in sales volume, (b) economic conditions and exchange rates, (c) actions by competitors, (d) the continuation of key vendor relationships, (e) the ability to maintain satisfactory loan agreements with lenders, (f) risks associated with the delivery of merchandise to customers utilizing common carriers, (g) the operation of the Company’s management information systems, and  (h) unanticipated legal and administrative proceedings.  Please refer to “Risk Factors” and the Forward Looking Statements sections contained in the Company’s Form 10-K for a more detailed explanation of the inherent limitations in such forward-looking statements.

INVESTOR/ MEDIA CONTACTS:

Denise Roche / Bill Douglass

Brainerd Communicators, Inc.

212-986-6667

roche@braincomm.com

douglass@braincomm.com

SYSTEMAX INC.
I.Condensed Consolidated Statements of Operations – Unaudited
(In thousands, except per share amounts)
	Quarter Ended December 31,*						Year Ended December 31,*
	2008			2007			2008			2007
Net sales	$	812,710		$	769,334		$	3,032,961		$	2,779,875
Cost of sales		695,762			649,678			2,568,816			2,353,574
Gross profit		116,948			119,656			464,145			426,301
Gross margin		14.4	%		15.6	%		15.3	%		15.3	%
Selling, general and administrative expenses		101,154			92,150			380,778			332,359
Operating income		15,794			27,506			83,367			93,942
Operating margin		1.9	%		3.6	%		2.7	%		3.4	%
Other (income) expense, net		467			(2,294	)		(376	)		(6,081	)
Income before income taxes		15, 327			29,800			83,743			100,023
Provision for income taxes		5,359			5,620			30,900			30,542
Effective tax rate		35.0	%		18.9	%		36.9	%		30.5	%
Net income	$	9,968		$	24,180		$	52,843		$	69,481
Net margin		1.2	%		3.1	%		1.7	%		2.5	%
Net income per common share:
Basic	$	.27		$	.67		$	1.45		$	1.93
Diluted	$	.27		$	.64		$	1.41		$	1.84
Weighted average common and  common equivalent shares:
Basic		36,393			36,089			36,450			35,968
Diluted		37,191			37,753			37,411			37,688

             SYSTEMAX INC.

II. Condensed Consolidated Balance Sheets
(In thousands)
	(Unaudited)
	December 31*,
	2008		2007
Current assets:
Cash and cash equivalents	$	115,967	$	128,021
Accounts receivable, net		190,909		207,460
Inventories		282,217		250,222
Prepaid expenses and other current assets		23,090		23,262
Total current assets		612,183		608,965
Property, plant and equipment, net		48,465		47,580
Goodwill, intangibles and other assets		42,615		19,802
Total assets	$	703,263	$	676,347
Current liabilities:
Short-term debt	$	773	$	4,302
Accounts payable and accrued expenses		360,846		330,310
Total current liabilities		361,619		334,612
Long-term debt		1,411		254
Other liabilities		6,278		5,646
Shareholders’ equity		333,955		335,835
Total liabilities and shareholders’ equity	$	703,263	$	676,347

* Systemax manages its business and reports using a 52-53 week fiscal year that ends at midnight on the Saturday closest to December 31.  For clarity of presentation, fiscal years and quarters are described as if they ended on the last day of the respective calendar month.  Certain reclassifications have been made to prior year amounts to conform with the current year presentation.  The actual fiscal twelve month period and quarter ended on January 3, 2009. The fourth quarters of 2008 and 2007 included 14 and 13 weeks, respectively, and the full year 2008 and 2007 included 53 and 52 weeks, respectively.

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