Been thinking of ATI Technologies, but the movers are in the
wireless & broadband area.
ATI Technologies
TORONTO STOCK EXCHANGE : ATY
NASDAQ : ATYT
Thu 13 Jan 2000
ATI Technologies, the world leader in 3-D graphics/video acceleration and
multimedia solutions has released its financial results for the company's
first quarter ended Nov. 30, 1999, achieving once again a record in
revenues for the quarter.
Sales for the first three months were $413.5-million, an increase of 26 per
cent from $327.4-million for the same period last year. Adjusted net income
for the first quarter, which excludes the amortization of acquired
intangibles, rose 5 per cent to $54.5-million, or 25 cents per share,
compared with $52-million, or 24 cents per share, for the same period last
year. (All per share amounts are expressed on a fully diluted basis.)
Actual net income for the first quarter, including the amortization of
acquired intangibles, was $53.6-million, or 25 cents per share, compared
with $50.1-million, or 23 cents per share, for the same period last year.
"Once again we have delivered a strong start to a new year," said K.Y. Ho,
ATI's president and chief executive officer. "ATI approaches a bright
future with growth prospects not only in our traditional PC business, but
in new and burgeoning markets like consumer electronics appliances. We look
forward to the year 2000 as these new markets continue to emerge."
Financial highlights
Sales in the first quarter reflected solid demand for ATI's RAGE 128 and
RAGE MOBILITY products, which comprised a greater percentage of corporate
revenues than in prior quarters. Demand for the company's XPERT series of
board products was exceptionally robust. This quarter also mirrored a
traditionally strong PC season, in addition to the company's quick reaction
to manage the impact of the earthquake in Taiwan. Gross margins declined to
34.1 per cent for the first quarter, compared with 36.6 per cent for the
same quarter last year. The aforementioned shifting in product mix, as well
as increased material costs used in the company's products, contributed to
gross margin decreases.
In line with increased activity and sales, operating costs (excluding the
amortization of intangibles) in the first quarter increased 43 per cent
year-over-year to $73.1-million, up from $51-million for the first quarter
in 1999. Increased operating costs were largely attributable to incremental
sales, marketing and R&D expenses to support an increased number of product
programs including desktop, mobile and set-top components and boards.
During the quarter, the company's operating tax rate decreased to 21 per
cent. Net earnings after taxes rose to $53.6-million, or 13 per cent of
sales, versus $50.1-million, or 15.3 per cent of sales, for the
corresponding quarter of 1999.
For the first quarter, the company's cash position increased by $7-million
after financing and investing activities, to stand at $102.5-million at
Nov. 30, 1999. During the quarter, working capital increased from
$294.4-million at the end of the fourth quarter, to $340.1-million at the
end of the first quarter of fiscal 2000. Accounts receivable and inventory
balances increased during the quarter to $261.4-million and $212-million,
respectively. Days sales in accounts receivable decreased to 46 days in the
first quarter, from 47 days in the fourth quarter of 1999.
Also during the quarter, ATI repurchased 725,300 of its common shares for
cancellation by way of a normal course issuer bid at prices ranging from
$14.08 (Canadian) to $14.14 (Canadian). The excess of the cost of
repurchasing the company's shares over its stated capital has been charged
to retained earnings.
Operational highlights
During the quarter, ATI announced a number of new products to much critical
acclaim from industry analysts and the media alike. An example, and to
support the company's target as the No. 1 mobile graphics vendor, ATI
announced the RAGE MOBILITY 128. Pin-compatible with previous MOBILITY
products, the MOBILITY 128 provides OEMs with an effective migration path
to the world's fastest graphics subsystem for notebook PCs. ATI also
announced the ALL-IN-WONDER 128 PRO, the latest generation of the company's
highly successful combination TV-tuner and video/graphics multimedia board.
ATI introduced the XPERT 2000 PRO add-in board, a low cost 32MB 2-D, 3-D
and DVD board for the SI, OEM and mainstream market, and the RAGE FURY
MAXX, a dual-chip accelerator board judged the fastest on the market and
aimed at the influential "power gamer" market segment.
ATI set an industry record in October, shipping more than two million
boards in the month and unveiled an extensive range of AGP 4X products to
coincide with the newly-announced Intel i820 AGP 4X chipset. ATI also
announced its endorsement of the open source movement and its official
support for the Linux operating system, ensuring future products will
support systems featuring the Linux OS.
ATI continued on its quest to become the undisputed leader in the mobile
market, announcing one million MOBILITY graphics accelerators had been
shipped during the most recent four-month period. The company also unveiled
a further series of design wins, including Gateway, NEC, several of Dell's
latest systems, and the entire HP OmniBook 4150 and 900 notebook PC lines.
ATI was also chosen for an IBM notebook PC for the first time, putting ATI
mobile graphics in products from nine of the top 10 notebook OEMs.
ATI also continued its leading position in the desktop marketplace. The
RAGE 128 and other ATI products were selected for new systems introduced by
Toshiba, SUN Microsystems, Acer, Fujitsu, eMachines, the new family of
Apple iMacs, and China's leading PC maker, Legend Computer Systems.
CONSOLIDATED STATEMENT OF OPERATIONS
Three months ended Nov. 30
(in thousands of U.S. dollars)
1999 1998
Sales $413,527 $327,388
Cost of goods sold 272,663 207,433
------- -------
140,864 119,955
Expenses
Selling and
marketing 36,351 26,095
Research and
development 29,526 17,742
Administrative 7,199 7,172
Amortization of
intangible assets 887 1,925
------- -------
73,963 52,934
------- -------
Income from
operations 66,901 67,021
Interest and other
income 1,189 1,421
Interest expense (32) (82)
------- -------
Income before
income taxes 68,058 68,360
Income taxes 14,478 18,274
------- -------
Net income $ 53,580 $ 50,086
======= =======
Net income per
share 25 cents 23 cents
WARNING: The company relies upon litigation
protection for "forward-looking" statements.
atitech.ca |
