SECURITIES AND EXCHANGE COMMISSION

	Three Months Ended		Nine Months Ended
	March 31,		March 31,
	2002	2001	2002	2001
NET SALES	$117,399,000	$142,690,000	$351,462,000	$408,410,000
COST AND EXPENSES
Cost of sales including buying
and occupancy expenses	111,850,000	134,490,000	332,924,000	383,403,000
Selling, general and administrative expenses	5,914,000	7,932,000	21,462,000	23,614,000
Facility Closure	362,000		362,000
Non-cash stock awards compensation expense		590,000		756,000
	118,126,000	143,012,000	354,748,000	407,773,000
OPERATING INCOME (LOSS)	(727,000)	(322,000)	(3,286,000)	637,000
INTEREST EXPENSE, net	282,000	173,000	720,000	568,000
EARNINGS (LOSS) BEFORE INCOME TAXES and cumulative
effect of a change in accounting principle	(1,009,000)	(495,000)	(4,006,000)	69,000
INCOME TAXES	137,000	30,000	407,000	289,000
NET (LOSS) EARNINGS before cumulative effect
of a change in accounting principle	(1,146,000)	(525,000)	(4,413,000)	(220,000)
CUMULATIVE EFFECT OF A CHANGE IN ACCOUNTING
PRINCIPLE, net of income tax benefits of $75,000			(6,297,000)
NET (LOSS) EARNINGS	$ (1,146,000)	$ (525,000)	$(10,710,000)	$ (220,000)
Basic and diluted (loss) earnings per share:
(Loss) earnings per share before cumulative
effect of a change in accounting principle	$(.30)	$(.15)	$(1.14)	$(.06)
Cumulative effect of a change in accounting
principle, net of tax benefit			(1.62)
Net (loss) earnings	$(.30)	$(.15)	$ (2.76)	$(.06)
WEIGHTED AVERAGE SHARES OUTSTANDING:
Basic	3,873,000	3,594,000	3,874,000	3,532,000
Diluted	3,873,000	3,594,000	3,874,000	3,601,000

(1) Comprehensive losses for the nine months ended March 31, 2002 and 2001 were $(14,239,000) and $(1,685,000), respectively.

2. Foreign Currency Translation and Equity For Stock Split

The assets and liabilities of the Company's foreign operations in Colombia, Argentina and Brazil are translated at the exchange rates in effect at the balance sheet date, with related translation gains and losses reported as a separate component of shareholders' equity (comprehensive income or loss). The results of foreign operations are translated at the weighted average exchange rates for the period. Gains or losses resulting from foreign currency transactions are included in the statement of operations.

On February 8, 2002, the Executive Branch of the Argentine Government issued Executive Order 260/02, whereby the foreign exchange regime was amended, replacing it with a free exchange market whereby all of the transactions in foreign currencies should be freely traded. These transactions are subject to the requirements and regulations of the Argentina Central Bank. The transfers abroad for financial loan principal services and profits and dividends made in the consecutive 90 days since February 11, 2002 require the prior consent of the Argentina Central Bank, whatever the payment term may be.

In addition to the above changes, the Argentine government declared a bank and foreign exchange holiday beginning April 22, 2002 for an indefinite period until certain laws were passed related to the conversion of depositors' bank savings accounts into ten year bonds. The bank holiday ended on April 29, 2002 and the peso again is available for market trading. The current exchange rate is approximately 2.85 pesos to the US$1. In addition, the Argentine government continues to negotiate with the International Monetary Fund ("IMF") for additional funding. To date, there has been no such agreement. Another IMF delegation is scheduled to visit Argentina in May 2002, however, there can be no assurances that any such agreement will be reached.

For the four months ended April 30, 2002, inflation in Argentina was approximately 30%. If the inflation rate in Argentina reaches a cumulative rate of 100% for a three-year period, Argentina would be considered a highly inflationary economy under Statement of Financial Accounting Standards No. 52 "Foreign Currency Translation." Accounting for the exchange rate effects on the financial statements of entities operating in highly inflationary economies is different than the present "current value method" of translation. If Argentina reaches highly inflationary status, this may result in increased volatility of the Company's reported operating results since the foreign currency financial statement re-measurement translation effects are generally recorded in the statement of operations as opposed to as a component of accumulated other comprehensive loss in the statement of shareholders' equity.

The Company re-measured the balance sheet at the current rate at March 31, 2002, which was 2.85 pesos to US$1.

From December 21, 2001 to January 11, 2002, trading in Argentine pesos (the peso) was suspended. Prior to December 21, 2001, the peso had been linked to the US dollar at an effective exchange rate of 1 to 1. In accordance with the Financial Accounting Standards Board Emerging Issues Task Force Issue D-12, "Foreign Currency Translation-Selection of Exchange Rate When Trading is Temporarily Suspended", the Company should use the rate in effect when trading resumes to translate transactions subsequent to December 20, 2001 and the balance sheet at December 31, 2001. Accordingly, the Company has used the rate of 1.7 pesos per US dollar for such measurements with the exception of the items described in the following paragraph.

On or about February 5, 2002, the Argentine government announced a preliminary ruling that all December 31, 2001 obligations then outstanding and denominated in US dollars to be settled in the country of Argentina should, by law, be settled at the rate of 1 to 1. Accordingly, the Company has assumed certain liabilities with trade vendors will be settled with no transaction currency loss. There can be no assurance that the Company will ultimately settle such losses at the rate of 1 to 1. If such liabilities are settled at rates less favorable than 1 to 1, the Company will realize additional foreign currency transaction losses in the future. In addition, the Company measured certain bank deposits in Argentina at the rate of 1.4 to 1, since such deposits were settled in January 2002 at this rate.

3. Bank Debt

The Company has a credit agreement with Wachovia Bank N.A. ("Wachovia"), as amended on October 12, 2001, which provides for borrowing under a line of credit of up to $25.0 million. At March 31, 2002, the Company had borrowings of $ 13.6 million outstanding under this facility. Maximum borrowings under the credit agreement are generally based on eligible accounts receivable and inventory (as defined in the credit agreement) less a $9.5 million reserve. This reserve can be drawn upon, if necessary, to finance obligations to IBM Credit Corporation, which finances the Company's purchases from certain vendors. Available borrowings under this agreement at March 31, 2002, based on collateral limitations, were $9.5 million ($9.5 million of which would only be available to finance obligations due to IBM, if necessary).

The Wachovia credit agreement is secured by accounts receivable and inventory of SED International, Inc. and requires maintenance of certain minimum working capital and other financial ratios and has certain dividend restrictions. The Company may borrow at Wachovia's prime rate (5.25% at March 31, 2002) plus .50% or the Company may fix the interest rate for periods of 30 to 180 days under various interest rate options. The credit agreement requires a commitment fee of .50% of the unused commitment and expires November 1, 2002. Average borrowings, maximum borrowings and the weighted average interest rate for the quarter ended March 31, 2002 were $6.2 million, $13.6 million and 5.25%, respectively. Average borrowings, maximum borrowings and the weighted average interest rate for the nine months ended March 31, 2002 were $3.2 million, $13.6 million and 5.25%, respectively. At March 31, 2002 the Company was in technical default with certain covenants under the Wachovia credit agreement; however, Wachovia and the Company subsequently waived the covenant violations and amended the agreement to achieve compliance.

The Company presently projects that it will be in compliance with the financial covenants associated with the Wachovia credit agreement through June 30, 2002. However, for each of the quarters ended September 30, 2001, December 31, 2001, and March 31, 2002, the Company has failed to maintain compliance with financial covenants. Therefore, there can be no assurance that the Company will be in compliance with the amended Wachovia agreement covenants at June 30, 2002. If the Company is not in compliance, Wachovia may declare an event of default and could demand repayment of all outstanding borrowings and discontinue the agreement. If Wachovia were to declare an event of default, the Company's liquidity and business operations could be adversely affected. In addition, the Wachovia agreement expires in November 2002. The Company is presently seeking alternative sources of financing in the United States and anticipates that such an agreement will be completed before September 30, 2002. However, no assurance can be given that the Company will be successful in obtaining a new credit facility, or that such a facility, if obtained, will be at rates and terms which are commercially comparable or favorable to the existing Wachovia credit agreement. Failure to obtain a new credit agreement could adversely affect the Company's liquidity and business operations.

Following is a summary of the Company's short-term foreign subsidiary bank debt:

	March 31,	June 30,
	2002	2001
SED International do
Brasil Distribuidora Ltda.	$2,479,000	$3,261,000
SED International de
Colombia Ltda.		283,000
	$2,479,000	$3,544,000

The weighted average monthly rates for the nine months ended March 31, 2002 were 1.9064% in Brazil.

4. Newly Adopted Accounting Standards

United States Latin America Eliminations Consolidated
For the three months ended
march March 31, 2002
Net sales:
Unaffiliated customers	$103,000,000	$14,399,000		$117,399,000
Foreign subsidiaries
Total	$103,000,000 $14,399,000 $117,399,000
Gross profit	$ 3,578,000	$ 1,971,000		$ 5,549,000
Income (loss) from operations	(1,110,000)	383,000		(727,000)
Total assets	96,309,000	17,165,000	$(11,854,000)		101,620,000
For the three months ended
March 31, 2001
Net sales:
Unaffiliated customers	$111,814,000	$30,876,000		$142,690,000
Foreign subsidiaries	343,000 $ (343,000)							$142,690,000
Total	$112,157,000 $30,876,000 $ (343,000) $142,690,000
Gross profit	$ 5,788,000	$ 2,412,000		$ 8,200,000
Loss from operations	(76,000)	(246,000)		(322,000)
Total assets	105,944,000	32,327,000	(17,016,000)	121,255,000

			Shipping and
For the three months	Microcomputer	Wireless Telephone	Handling
Ended March 31, Products Products Revenue Total
2002	$111,441,000	$5,599,000	$ 359,000	$117,399,000
2001	135,551,000	6,677,000	462,000	142,690,000

United States Latin America Eliminations Consolidated
For the nine months ended
March 31, 2002
Net sales:
Unaffiliated customers	$294,513,000	$56,949,000		$351,462,000
Foreign subsidiaries	441,000 $ (441,000)
Total	$294,954,000 $56,949,000 $ (441,000) 351,462,000
Gross profit	$ 11,784,000	$ 6,754,000		$ 18,538,000
Loss from operations	(2,912,000)	(374,000)		(3,286,000)
Total assets	96,309,000	17,165,000	$(11,854,000)	101,620,000
For the nine months ended
March 31, 2001
Net sales:
Unaffiliated customers	$309,512,000	$98,898,000		$408,410,000
Foreign subsidiaries	1,184,000 $ (1,184,000)
Total	$310,696,000 $98,898,000 $ (1,184,000) $408,410,000
Gross profit	$ 16,158,000	$ 8,849,000		$ 25,007,000
Income from operations	432,000	205,000		637,000
Total assets	105,944,000	32,327,000	$(17,016,000)	121,255,000

			Shipping and
For the nine months	Microcomputer	Wireless Telephone	Handling
Ended March 31, Products Products Revenue Total
2002	$334,346,000	$16,004,000	$1,112,000	$351,462,000
2001	379,823,000	27,064,000	1,523,000	408,410,000

This report contains certain statements that are not based on historical facts and which may be considered forward-looking statements as defined in the Private Securities Litigation Act of 1995. These statements may differ materially from actual future events or results, and by their nature they involve substantial risks and uncertainties, certain of which are beyond the Company's control. Readers are cautioned not to place undue reliance on these forward-looking statements, which reflect Management's judgment only as of the date hereof. Factors that might cause the Company's actual results to differ from those described in the forward-looking statements are referred to in the sections under the headings "Risk Factors," and "Management's Discussion and Analysis of Financial Condition and Results of Operations," which are contained in the Company's Registration Statement on Form S-3 (SEC File No. 333-35069) and these factors include the Company's ability to maintain profitability, cash flow, revenue growth, business prospects, foreign currency fluctuations, a dependence upon and/or loss of key vendors or customers, customer demand, product availability, competition (including pricing and availability). The Company undertakes no obligation to update forward-looking statements contained herein.

	No. of	No. of Votes	No. of Votes
	Votes For	Against	Abstained
Reverse Split	7,137,287	141,392	16,604

a)	Exhibits
	Exhibit
	Number	Description
	10.41	Sixth Amendment to Second Amended and Restated Credit
		Agreement dated May 14, 2002 between SED International
		Holdings, Inc. and Wachovia Bank, N.A.