Avnet Inc. said it appointed William Amelio interim CEO, replacing Rick Hamada who has resigned with immediate effect from his position and from the board of directors. Hamada became CEO of the global electronics component distributor in 2011 and joined the company more than 30 years ago.
The company did not provide detailed information about why it sacked Hamada but it indicated that the changing market conditions required new guidance at the top. Amelio, a veteran of the high-tech industry and a turnaround specialist who has championed change at other enterprises, is now expected to help steer Avnet in a different direction, according to William Schumann, chairman of the board of directors at Avnet.
“Bill’s extensive experience in international business operations, corporate leadership and management will help steer the company toward success in a rapidly changing industry,” Schumann said, in a statement. “His proven expertise will be critical in accelerating Avnet’s growth, driving an enhanced execution focus and implementing management systems to promote greater accountability. On behalf of the Board, I want to thank Rick for his service and the many important contributions he has made during his 32 years with Avnet. We wish him the best in his future endeavors.”
Amelio had once worked as CEO of Lenovo Group and was previously general manager of IBM’s personal computer division before it was acquired by the Chinese enterprise. He was most recently president and CEO of CHC Group Ltd., an oil-field services company that he led from 2010 to 2015. Amelio was also on the board of directors of National Semiconductor, the company said. It is expected that he will draw on his industry experience to chart a growth course for the global distributor, the company said.
“I look forward to working with the management team and all of Avnet’s talented employees worldwide as we strive to achieve profitable growth for shareholders and operational excellence for customers while enhancing the company’s winning culture to the benefit of employees,” said Amelio said.
Avnet also said today that it expects fiscal 2016 fourth quarter sales would be in the range of $6.15 billion to $6.25 billion, close to its previous guidance but slightly below the consensus estimate of $6.27 billion from analysts. The company slashed its earnings guidance sharply, dropping this to a range of 80 cents to 86 cents per share, compared with a prior forecast of 95 cents to $1.05 per share. It attributed the decline to problems in the implementation of the company’s enterprise resource program implementation in the Americas.
“Sales for the region are expected to be approximately $100 million less than the prior outlook and the region also incurred higher costs in order to maintain customer deliveries,” Avnet said. “While the impact to sales was minimal by the end of the June quarter, some of the higher costs incurred are expected to continue and will likely impact the first fiscal quarter ended October 1, 2016.”