HI all!
know these articles are old news but I think it is nice for you guys to know what the local newspaper, where the Iomega Headquarter is, wrote all about.
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IOMEGA HITS RECORD SALES IN QUARTER
Friday, October 18, 1996
By Mike Marino - Standard Examiner staff
Aggresive marketing helps company drive past expected slowdown
ROY - So much for pessisim.
After sounding a semi-vailed July warning about the forces that could cause a rocky third quarter, Iomega Corp. on Thursday instead announced record sales for the three-month period, thanks in part to measures the company took to fight the worries in the first place.
The computer-storage maker reported third-quarter sales of $310 million, up dramatically from the $84.7 million figure a year ago -- but, more importantly, also well above the $284 million posted during a record second quarter.
Earnings, at $12.8 million, were down from $14 million in the second quarter. But at 9 cents per common share, the third-quarter figure exceed the Wall Street consensus of 7 cents per share by nearly 30 percent.
Iomega stock was up 2 1/8 at $25 in morning trading.
Kim Edwards, Iomega's president and chief executive officer, had cautioned analysts in July about challenges the company expected to face in the coming three months: a reported slowdown in PC sales and the early arrival of the summer sales "dollrums" in Europe. But thanks to better-than-expected European sales and price cuts on its Zip and Jaz drives that boosted sales in the United States, Edwards said those challenges were met.
"I think that's fair, considering what we faced," he said Thursday, "considering the summer doldrums in Europe and here in the states, and that we reduced prices on Zip and Jaz and had to sell more volume to make the same top line. Yes, we're very pleased with the performance."
Edwards said the company tried to combat the perceived slow sales season with a all-out marketing effort, the most high-profile of which was a $50 rebate on the Zip drive, dropping the price to $149.00
"The marketing efforts we put on for U.S. retail were absolutely key for us," Edward said.
The company's European sales, at $51 million, were down from $56 million in the second quarter but hardly as disastrous as feared. And Iomega also benefited from the near-immediate production at its new plant in Penang, Malaysia, which is purchased from Quantum Corp. in July. The plant, purchased to help the company increase its manufacturing base in the Far East, began shipping Jaz and Ditto drives last month.
"That was a very pleasant surprise," Edward said of the facility. "What really impressed me was those people's ability to bring up the ramp on the Jaz drive.
"They were over here at the end of July, and by the end of August they were producing Jaz drives. By the beginning of September they where shipping product units out of there."
The company listed unaudited third-quarter assets at $650 million, up from $266 million at the end of the 1995 fourth quarter. It reported cash on hand of $102 million, dramatically exceeding the $1.02 million it had at the beginning of the year.
"We managed to manage the challenges, " said Len Purkis, the company's chief financial officer. "Now we've got a solid financial foundation."
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SECOND ARTICLE
EXECUTIVES OPT FOR NYSE MOVE FROM NASDAQ
By Mike Marino - Standard Examiner staff
Roy - NASDAQ may be the stock market for the next 100 years, but not for Iomega.
The company announced on Thursday that it would file an application to lists its stock on the New York Stock Exchange and leave the technology-driven market that had been the longtime playground for its spectacular ups and downs, particularly over the last ninth months.
Kim Edwards, Iomega president and CEO, said the move was made with shareholders in mind. But he added that there was no single factor in making the decision.
"It was not black-and-white. A lot of research went into it and there were a lot of issues to deal with, but given our stage of development, we felt that the timing was right." he said. "We were very pleased with NASDAQ. They had allowed us to go to the market at different times for well over $200 million.
"But we had a lot of conversation with our chairman, Dave Dunn, and I will tell you that this was collective thinking. We concluded that for a lot of different reasons, the balance of the scales tipped to the NYSE."
Thwarting the hopes of market-symbol fans, the company will not follow the lead of such firms as Anheuser-Busch, whose stock is listed under the symbol of its most popular product: BUD. Instead of "ZIP" or "JAZ," Iomega has opted for the more conventional "IOM."
CNBC reported this morning that the company had applied for the unused symbol "I" but that the exchange is holding it in case semiconductor giant Intel also decides to leave the NASDAQ for the NYSE.
The company expects to be listed on the New York exchange within three weeks. |
