Acromedia Ltd. Q2 - African Supply Chain and Logistics Management - Wireless Device Distribution

PRLog (Press Release) – Jul 27, 2009 – Acromedia Ltd., the third largest open market wireless device distributor has entered into an agreement with Swiss based Panalpina, to carry out logistics operations in the Sub Saharan regions of Africa. Ghana, Cameroon, Chad, Congo, Nigeria, and other Sub Saharan states have seen many economic improvements in recent years. Well endowed with natural resources, Ghana has roughly twice the per capita output of the poorest countries in West Africa. Sound macro-economic management along with high prices for gold and cocoa helped sustain GDP growth in 2008.
“ The economic conditions across certain African markets are good for penetration. Despite the macroeconomic slowdown, and its serious implications throughout the region, the spirit and morale among the residents of many states remain strong. We find this encouraging. We believe in them and their eagerness to improve macroeconomic conditions inspires us. While many multinationals are retreating from Africa, we seek to build uniform positions in a spirit of solidarity.”
The macro-environment is challenging and we believe will remain so for the remainder of 2009 clearly. However, Acromedia's longer term strategy remains valid and intact, and has a tremendous opportunity to capture value with Low-cost and ultra-low-cost (ULCH) handsets and higher-end smart phones as prescribed by market indicators.
Despite the current environment, it is very clear we must continue to invest in our future growth. Invest at a slower, more appropriate pace but invest to innovate and grow. We consider our scale and distribution to be a key competitive advantage and we are responding in a tactical manner to pricing activities of our competitors.
Acromedia Ltd. has focused much of its global distribution in META, the Middle East, Turkey, Africa. Although without a more ironclad logistics partner for the African market, Acromedia's spot light has been its Izmir and Istanbul Turkey hubs where Penske manages regional distribution. The recent partnership with Panalpina will not affect Turkish distribution, but rather strengthen its African and global positions.
Turkey offers a host of barriers to entry for the most dedicated, and with Brightpoints recent withdrawal there remains a pool of possibility, if one can wade the murky waters surrounding Ankara. Turkish imports are a global question punctuated by confusion. Where others fail, Acromedia has thrived. This point could be no more clear than with its recent success in Ghana and Nigeria.
Acromedia has risen to a significant player in the global open market, an obvious position for a company dedicated to improving communication throughout young and emerging markets. Acromedia's core beliefs are carefully cloaked within its mission statement; “Your success drives us.” Honesty, Trusted, Integrity, Results Oriented.
Panalpina Basel, Switzerland
(U.S.) Foster City, CA, 650-653-6600, Peter Merath, Regional CEO
www.panalpina.com
3PL Revenue: 5.3bn Parent Revenue: 5.3bn
Coverage: Europe, Asia, Americas, Africa
3PL Assets: 13,000 employees; 300 warehouses
Information Systems: Good; Emphasis is on internet-native SCM
Services: Air and ocean freight forwarding, transportation management, warehousing and distribution, oil and gas services
Industry Focus: Automotive, computers and electronics, oil and gas, consumer goods, beverages, apparel, healthcare
Key Customers: Chevron, Delphi, Hewlett Packard, IBM, Philips Electronics, Robert Bosch, Shell Chemical, Sun Microsystems
Industry Vendors
Dec. 2008
Apple Inc.
iPhone shipments totaled 4.4 million units versus our estimate of 4.1 million units. The company indicated channel inventory was drawn down by approximately 250k units (recall 3mm channel build of inventory in the prior quarter). Research has suggested current build targets in Asia for iPhone of 3.0-3.5 million units for the Mar-09 quarter, leaving us comfortable with our 3.3 million unit assumption in the Mar-09 quarter. The pro forma revenue recognition suggests the gross margin on the unrecognized revenue from the segment increased to 61% in the quarter versus 48% in the prior quarter.
Dec. 2008
Nokia Inc.
Device shipments totaled 113.1 million in 4Q08 (versus 117.8 mm in 3Q08 and 133.5 mm in 4Q07), a 4% sequential decline and a 15% Y/Y decline in units. Challenges associated with a channel drawdown of inventory (likely to continue in 1Q09) and poor credit availability have pressured orders and visibility. The company also indicated 1Q09 shipments would likely decline at a greater than seasonal rate relative to the last several years (shipments declined 13% seq in 1Q07 and declined 14% sequentially in 1Q06).


Dan Goldman

dgoldman@acromediadistribution.com
Acromedia Ltd.

PO Box 770751

Cleveland, Oh 44107

(800) 856-5102

http://www.acromediadistribution.com