HMT Technology Corporation Announces Results for Third Quarter of Fiscal 1999
Business Wire - January 14, 1999 16:17
FREMONT, Calif.--(BUSINESS WIRE)--Jan. 14, 1999--HMT Technology Corporation (Nasdaq:HMTT), announced financial results for the third quarter of fiscal 1999, ended Dec. 31, 1998.
During the third quarter, the Company recorded restructuring and other one-time charges of $19.5 million (pre-tax) which included a $15.7 million restructuring charge for consolidation of the company's manufacturing operations, a $2.3 million charge for inventory revaluation (included in cost of sales) and a $1.5 million charge for uncollectible receivables (included in selling, general and administrative expenses). The restructuring and other one-time charges of $19.5 million were consistent with the company's earlier press release, issued on October 20, 1998.
Net sales for the third quarter of fiscal 1999 were $69.8 million, up 22.4 percent from the $57.0 million reported in the second quarter of fiscal 1999, and down 29.2 percent from the $98.6 million reported in the third quarter of fiscal 1998.
Gross profit was $7.2 million, or 10.3 percent of net sales, for the third quarter of fiscal 1999. Excluding the $2.3 million inventory charge, gross profit would have been $9.5 million, or 13.7 percent of net sales. This compares with gross profit of $8.0 million, or 14.1 percent of net sales, for the second quarter of fiscal 1999, and $37.0 million, or 37.6 percent of net sales, for the third quarter of fiscal 1998.
Net loss for the third quarter of fiscal 1999 was $12.4 million, or $0.28 per diluted share on 43.8 million shares outstanding. Excluding the restructuring and other one-time charges of $19.5 million (net of tax benefit), third quarter net income on a pro-forma basis was $1.3 million, or $0.03 per diluted share on 43.8 million shares outstanding. This compares with net income of $505,000 or $0.01 per diluted share on 43.6 million shares outstanding in the second quarter of fiscal 1999, and $20.5 million or $0.40 per diluted share on 55.1 million shares outstanding in the third quarter of fiscal 1998.
For the nine months ended Dec. 31, 1998, net sales, net loss and net loss per diluted share were $183.6 million, $10.8 million and $0.25 per diluted share on 43.6 million shares outstanding, respectively. Excluding the restructuring and other one-time charges of $19.5 million (net of tax benefit), nine months net income and net income per diluted share would have been $2.9 million, or $0.07 per diluted share. This compares with net sales, net income and net income per diluted share of $265.8 million, $54.9 million and $1.04 per diluted share on 54.4 million shares outstanding, respectively, for the nine months ended Dec. 31, 1997.
"As we indicated in our October 20, 1998 press release, we entered this quarter encouraged by the order outlook for the quarter, but due to uncertainty in the outlook for the overall storage industry, we decided it was necessary to implement a restructuring to properly align our cost structure with the near term outlook. We also indicated that we expected the total one-time charge to earnings to be between $15-25 million before tax," said Ronald Schauer, Chairman, President and CEO.
"We are pleased to report that revenue for the quarter was up 22.4% over the second quarter, and we completed the restructuring during the quarter with the restructuring and other one-time charges totaling $19.5 million before tax," said Schauer. "While actions like this are always painful, we feel very strongly that we are now much better positioned to meet the future needs of our customers, shareholders and employees."
"We continue to be very pleased with the performance of our advanced magneto-resistive, laser textured media. During the quarter, approximately 60% of our shipments were for advanced products with areal densities in excess of 3 GB per platter," said Schauer. "In particular, we are extremely satisfied by the performance of our 4.3 GB per platter product in production, as well as the progress in qualifications on our 5.1 and 6.5 GB per platter products."
The statements in this news release, other than historical financial information, may contain forward-looking statements that involve risks and uncertainties that could cause actual results to differ from predicted results. Further information on factors that could affect the company's results is detailed in the company's report on Form 10-K for the year ended March 31, 1998 and Form 10-Q/A for the period ended September 30, 1998, as filed with the Securities and Exchange Commission.
HMT Technology Corporation independently designs, develops, manufactures and markets high-performance thin-film disks. The company's products are used in high-capacity hard disk drives for a variety of high-end applications, including personal computers, network servers and workstations, and in certain removable hard disk drive applications. The disks currently being shipped by HMT primarily have coercivity levels of 2000 to 3000 Oersted, a measure of storage capacity, and glide heights of 1.2 to 0.8 microinches. The company's shares are traded on the Nasdaq National Market under the symbol HMTT. Additional information may be obtained by visiting HMT's website at hmtt.com, or by contacting the company directly.
Condensed Consolidated Statements of Operations and Balance Sheets to follow.
|
