Avnet Technology Solutions

Q1 FY09 Global Financial Results & Highlights October 23, 2008

Q109 at a Glance

Revenue, operating income fell just short of plan in Q1 Solutions and vertical market practices continue to grow Slowdown in tech spending anticipated in Q2, Q3 Solutions strategy solid, but expense control measures in place

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TS Global: Revenue

Q109 Revenue = $1.79B Q1 up 11.5% year over year on a net revenue basis, but short of plan

• Organic growth declined in all 3 regions year/year• EMEA Horizon acquisition performed well• HP, solutions practices, vertical practices posted year/year gains

$1.21

$1.46

$1.77$1.61

$2.27

$1.80$1.95

$1.79

$1.56

$1.00

$1.50

$2.00

$2.50

Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109

BILLIONS

$0

$20

$40

$60

$80

$100

$120

Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q1092%

3%

4%

5%

Q109 Op Income = $51.1M Q1 down 13% year over year

• Although margins were up and expenses were down, we could not compensate for the late-quarter drop in sales

TS Global: Operating Income

MILLIONS

Excluding restructuring and other charges

Operating income $$

Operating margin

Operating Income = Gross Profit – Operating Expenses

TS Global: Return on Working Capital

53.2%

83.5%

40.1%

57.8%

34.2%28.6%

21.5%

36.5%

47.8%

0%

20%

40%

60%

80%

100%

Q107 Q207 Q307 Q407 Q108 Q208 Q308 Q408 Q109

Q109 ROWC = 28.6% Inventory down, inventory turns up year over year, but ROWC declined 20% year over

year primarily due to lower than expected revenue We reduced expenses $11.4M (from plan) in Q1 Working capital dollars came in at $44M less than plan

Excluding restructuring and other charges

ROWC represents operating profit in relation to working capital.

In the Spotlight: Operational Excellence (OPX)

Americas On track to achieve 5% operating income goal Completed three projects with estimated benefits of $3.5M 16 process re-engineering / improvement projects underway in Americas

EMEA Process redesign opportunities identified in EMEA, and ROI calculation is underway

(estimated to be approx. €85K) Asia Pacific

Three process redesign activities initiated in Asia and two at discovery stage

““Operational excellence isn’t just about major projects and million-dollar Operational excellence isn’t just about major projects and million-dollar returns. It’s about developing a culture of innovation and continuous returns. It’s about developing a culture of innovation and continuous

process improvement.” process improvement.” – Usha Shah, VP, Operational Excellence, TS Global

““

In the Spotlight: People Development

Americas Merit cycle timeline realigned to follow performance reviews Making progress toward performance management goals (meritocracy)

EMEA Team focused on integrating people into the company (acquisitions) and aligning the workforce

within the organizational structure Asia Pacific

Employee survey results up 3% to 7% Focusing on performance management, integrations, attracting and retaining talented people

““One of the things our employee engagement survey is telling us is One of the things our employee engagement survey is telling us is employees want to know people are getting rewarded employees want to know people are getting rewarded

and recognized based on superior performance.” and recognized based on superior performance.”– Linda Biddle, VP, Talent Management, TS Global

““

In the Spotlight: Customer Engagement

Americas Voice of the Customer office initiatives gathering steam Hot alert closed loop process for customer complaints Automatic notification of sales force when shipping commitments will be missed Hassle Free initiative gives front line people ability to grant returns to $10K

1st global Customer Service Week Just say, “Thank you!”: Hundreds of calls, thank-you notes sent Video contest, regional

and local events all over the world

Scorecard developed to track performance around the world

In the Spotlight: IT Projects

Project Diamond Regional project leadership teams to update management, all employees in November

Americas B2B initiative – Entangling customers through automation Supply chain optimization – Enhancing material planning with Manugisitics Decision intelligence – Providing price optimization capability through Zilliant

EMEA Integrating the Horizon acquisition in Dublin, Ireland (complete in Q2) Red Prairie – Enhancing warehouse management

Asia Pacific Integrating the Ontrack acquisition in Mumbai, India (complete in Q2) Supporting the set-up of the new Beijing office (complete in Q2) Completing systems integration work at the Tianjin Integration Center

““During Q1 the critical focus for the TS GIS team globally has been During Q1 the critical focus for the TS GIS team globally has been centered on the strategic TS ‘big rock’ projects. Overall, these projects are centered on the strategic TS ‘big rock’ projects. Overall, these projects are

tracking well, with no major issues to report.” tracking well, with no major issues to report.” – Ger Purcell, TS GIS, Sr. VP

““

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TS Global: Q209 Outlook

Q209 outlook Below normal seasonality

• TS usually sees a 25% increase in sales in Q2 (over Q1) as the calendar year ends. We expect less than that this year in alignment with softening global economy

• Revenue $1.95B to $2.19B forecast for Q209• End customers seem reluctant to spend money on discretionary projects with a longer

payback as proprietary server sales have been most affected. On the other hand, capacity and efficiency requirements are still driving storage and networking growth, while our solutions practices are delivering attractive growth rates as well.

• Pressure will remain to lower our cost if we don’t see improvement in market conditions

““In good times and bad, our partners have a choice, and they will always In good times and bad, our partners have a choice, and they will always gravitate to the distributor that helps them create value and capture growth gravitate to the distributor that helps them create value and capture growth opportunities.” opportunities.”

– John Paget, President, TS Global, Oct. 9, 2008

““

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TS Global: What We Need to Do in Q2 As we navigate within the current climate, we must:

Listen well and put our partners’ needs at the forefront of our decisions Examine all available data and act on it decisively and without procrastination Be prudent in the use of our financial resources Run our businesses profitably – solid business fundamentals like return on working capital

(ROWC) and return on capital employed (ROCE) never go out of style Continue to evolve our systems, processes, services and solutions in support of our and our

customers’ and suppliers’ growth

““Recent studies have shown that two-tiered distribution is the most cost-Recent studies have shown that two-tiered distribution is the most cost-effective means of selling IT solutions into the marketplace, and the effective means of selling IT solutions into the marketplace, and the

effectiveness with which we move products, services and solutions to market effectiveness with which we move products, services and solutions to market is one of our strongest assets. Furthermore, we are one of the great is one of our strongest assets. Furthermore, we are one of the great

aggregators of best-of-breed products, and consequently, we are a strategic aggregators of best-of-breed products, and consequently, we are a strategic business partner.business partner. They recognize TS as a partner that adds real value, a They recognize TS as a partner that adds real value, a

reputation we have worked hard to earn and intend to keep.”reputation we have worked hard to earn and intend to keep.”

– John Paget, President, TS Global, Oct. 9, 2008

““

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Solid Business Principles Never Go Out of Style

Profitable Growth Remain intently focused on growing profitable revenue and capturing more than our fair

share of the market. In all three regions, our attention to sales must never diminish. We must move forward with the technology solutions the marketplace is buying.

Operational Excellence We must re-engineer our processes to create a more efficient means to grow the business.

Operational excellence is not program management, nor is it a department – it is a way of life. Focus on eliminating redundant processes and their costs. “Working smarter” is an overused phrase, but it is very appropriate for our situation.

Customer Engagement We need the help of our vendors. We must make certain we are relevant to them and engage

with them to assist us in accelerating their success. Our reseller customers need to feel our touch and strong support. They need to hear we care and we have a better way for them to grow their business.

People Development Focus on our and our colleagues’ development. This is a people business. Listen well – the

answers we need to make a quantum leap forward and transform our business already reside in our TS colleagues’ hearts and minds.

How We Measure Success KPM = Key Performance Metric

TS Global: Mission

To lead our industry To lead our industry

in growth, innovation, value and effectivenessin growth, innovation, value and effectiveness

in such a way that it ensuresin such a way that it ensures

we are an we are an indispensableindispensable element element

of our suppliers’, customers’ and employees’ of our suppliers’, customers’ and employees’

success and future dreams.success and future dreams.

TS Global: Mission

G I V EG I V EGROWTH INNOVATION VALUE EFFECTIVENESS

This presentation is updated quarterly and distributed via the TS Global newsletter in conjunction with the release of Avnet’s financial performance

(approximately three weeks after quarter end and five weeks after fiscal year end). It is intended to give TS employees around the world a quick overview of TS’ financial performance and highlights, and may be used (in whole or in part)

alone or with other TS presentations to talk about TS at the global level.

For more information, please contact Michelle Taylor, Director, TS Global Marcom: michelle.taylor@avnet.com