Connection reports a healthy 2018

Revenue rose 6.6 percent, earnings up 7.6 percent for the year

Connection, which started as a direct mail company selling computer hardware and software to individuals and small businesses, now earns more revenue from large corporations moving toward cloud-based services.

Last year 43 percent of the company’s business came from Fortune 1000 companies, compared to 38 percent from small business and individual customer accounts, according to the company’s annual financial statement for 2018. The rest of Connection’s revenue comes from sales to government.

That’s just one piece of good news for the Merrimack=based company, which reported a 6.6 percent increase in revenue, to $2.7 billion, or $2.41 per share, resulting in $64.6 million profit, up 7.6 percent from 2017.

The company also finished 2018 with a strong fourth quarter, with $710 million in revenue, up 7.3 percent, and a 2.8 percent increase in net income, to $21.3 million, or 80 cents a diluted share.

Those percentage increases take into account a major accounting change from last year. The growth also occurred despite the loss of a 2017 windfall from the federal tax break (the company only had to pay 5.7 percent in taxes in 2017 as oppose to 26.3 percent last year).

The company’s growth also withstood a decline of 8.5 percent in revenue from the public sector compared to last year as well a 17 percent decline in those sales in the fourth quarter, primarily due to less federal spending, even before the government shutdown.

Revenue from Revenue Enterprise Solutions, which covers large corporations, went up 17.9 percent, the company said.

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