Just for kicks, here's my analysis of 4th quarter earnings
I've been working the revenue figures from Iomega's last 3 quarters.
Here's what I found:
Based on shipping reports, I've extrapolated the following:
Zip disc sales
1st quarter 1.2MM
2nd quarter 1.5 MM
3rd quarter 1.8 MM
4th quarter 3.0 MM
Revenues in the first 3 quarters for Zip and Jaz only: (as reported by
IOM)
1st: $323MM
2nd: $371MM ($48MM more than Q1 on 300K more drives BUT remember the
cost of the Jaz recall)
3rd: $406MM ($35MM more than Q1 on 300K more drives BUT remember the
plants were shut down for 25% of the quarter)
Ok, now, remember that Q2 was the one affected by the Jaz disc recall,
so I'll use 1st and 3rd. Total Zip sales in these 2 quarters was 3.0 MM,
EXACTLY WHAT THEY'RE SELLING IN Q4.
So, as long as Jaz sales stayed the same (almost certainly they went up some), tie ratios stayed constant, and prices to OEMs and VARs stayed the same (I know they went down some but remember they went off MAP in Q4, so cost reductions would offset these), then Q4 revenue should approximate the sum of Q1 and Q3.
This would give us Q4 revenue for just Zip and Jaz of $729MM. Add $21MM for Ditto and Zip Plus (that is very conservative), and you have $750MM for Q4.
At gross margin of 33% (Q3 margin), that gives us $250 MM in gross
margin. Using Q3's 7% net after tax, we're looking at $53 MM in after
tax income for the quarter or 38 cents per share, WELL ABOVE ESTIMATES.
Taking out $29MM in Q4 for Jaz sales, we have $700MM for Zip discs and
drives. Divided by 3MM drives, that's $233 per sale or a tie ratio of
over 10 per drive!!!
I just can't see how these numbers don't work. It is simple addition.
Any comments?
BTW, I think that if Iomega does these numbers, we should never listen
to the analysts that cover them anymore as they could have done the same
math in order to come out with these same figures. |
