ADC Telecom CEO confirms keeps fiscal 3Q, 2001 estimates
Friday, June 8, 2001
ATLANTA -- Rick Roscitt, CEO of ADC Telecommunications Inc., said the Minnetonka company is maintaining its financial estimates for its fiscal third quarter ending
in July and fiscal 2001 ending in October.
In an interview Wednesday at the Supercomm 2001 conference in Atlanta, Roscitt said the company's restructuring plans are proceeding as intended, and that products that
don't make money will be eliminated.
When ADC reported its second-quarter results in May, it lowered its third-quarter estimate, saying it would range from break-even to a loss of 5 cents a share. It expects
third-quarter revenue of $600 million to $650 million. Analysts had been expecting earnings of 2 cents a share and revenue of $716 million. The company also announced
plans to cut jobs and sell less profitable parts of the firm.
Roscitt said he is preparing the company to weather two quarters of slower spending on telecommunications equipment, "and maybe two quarters beyond that."
He said he believes there will be a continued shakeout in the start-up phone industry, with more bankruptcies coming. Eventually, he said, consolidation will leave larger
start-up phone companies with lower debt loads. That should contribute to a healthier spending environment, as should competition for digital subscriber line customers
among cable and large telephone companies.
At the show, ADC unveiled digital subscriber line gear that enables telephone companies to extend the service to more customers.
Roscitt said the company probably will stay out of the acquisition market until its stock rebounds. "If I can get my stock up to $15 or $20 a share, I'd certainly use it as
currency" for acquisitions, he said. The shares closed Thursday at $8.83.
-- Dow Jones News Service
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