CDW Lowers Guidance

Tech retailer CDW Computer Centers Wednesday warned
investors that first quarter sales will likely fall short of previous
guidance, though it also noted that gross profit margins remain strong.

While CDW chairman and CEO John A. Edwardson acknowledged that sales would
probably come in under expectations, he pointed out that the company still
expects record sales and earnings per diluted share for the quarter, with
EPS coming in at the lower range of its previous forecast.

“Projected earnings per diluted share are consistent with our earlier
guidance of 48 cents to 50 cents, however, not at the higher end of that
range,” he said. “Gross profit margins remain strong, although we expect
sales to be below our earlier guidance. We’ve experienced a sales increase
of approximately 2 percent for the first quarter through March 11, compared
with that time period last year.”

According to a survey by Thomson First Call, analysts are looking for first
quarter EPS of 49 cents a share. In the year ago quarter, CDW posted EPS of
46 cents a share.

CDW said it saw flat sales in the corporate sector for the quarter, as
compared with the year-ago quarter, while public sector sales scaled up by
12 percent. However, the company noted that the growth rate of its public
sector sales has slowed compared with recent quarters. It cited a
year-over-year decline in sales to federal government agencies as the main
culprit behind the decline, saying those agencies were affected by the
delayed passage of the 2003 Federal Civilian Agency Budgets, which were
finally signed in February.

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