PLAINFIELD, Ind.—Investors applauded Brightpoint Inc., sending the company’s stock up more than 15 percent, after the mobile phone distributor posted third-quarter profits and revenues that reached record levels.
Brightpoint’s revenues were $633.7 million, an increase of 16 percent from revenues of $545 million during the third quarter of 2005. The figure far exceeded average analyst forecasts of $590.5 million.
Net income was $8.8 million, a reversal of net loss of $6.2 million reported during the same period last year.
“The results show that management’s multi-pronged expansion strategy is proving a buffer to trouble spots, but also highlights that execution and a watchful eye by management are key to EPS (earnings per share) growth,” wrote Ittai Kidron of CIBC World Markets. The firm makes a market in Brightpoint securities.
Brightpoint’s stock hit $13.48 per share, an increase of $1.84, following the news.
Brightpoint said it handled 12.6 million wireless devices during the quarter, 17 percent more than it handled during last year’s third quarter. Brightpoint said the increase was driven by 19-percent growth in fee-based logistic services unit volumes and a 12-percent increase in distribution unit volumes.
“In the third quarter, our revenue of $634 million was an all time quarterly record,” said Robert Laikin, Brightpoint’s chairman and chief executive officer. “The global demand for wireless devices continued to be healthy as reflected by the estimated 243 million units sold in the global wireless industry during Q3 2006.
“I currently expect that the fourth quarter will grow approximately between 5 percent and 7 percent sequentially and that the number of handset units sold by the global wireless industry will be in the range of 255 million to 260 million units,” continued Laikin. “This growth should be driven primarily by wireless demand from high growth markets such as India and Russia.”
