Adaptec Announces Third Quarter Financial Results; Revenues of $254 Million, Net Income of
$0.23 Per Share
BusinessWire, Tuesday, January 20, 1998 at 16:40
MILPITAS, Calif.--(BUSINESS WIRE)--Jan. 20, 1998--Adaptec, Inc.
today reported financial results for its fiscal 1998 third quarter
which ended December 31, 1997. Revenues were $254 million, compared to
$252 million reported for the corresponding quarter of the prior
fiscal year. Net income before one-time charges was $37 million or
$0.38 per share while reported net income for the third quarter was
$27 million or $0.23 per share. The reported net income included
charges of $0.15 per share. This is t he result of a recent FASB
ruling which required an $0.07 per share charge while additional
provision for doubtful receivables and the write-off of previously
acquired technology totaled $0.08 per share.
Paul Hansen, Adaptec's CFO, said: "As we reported in a
preliminary earnings announcement on January 8th, revenues and
earnings for the quarter were below expectations. This can be
attributed in large part to a shortfall in the North American
distribution sales of our host adapter products for desktop
applications. In this channel, where our products are predominately
sold to VARs and integrators, we are increasing our emphasis on
marketing activities."
Grant Saviers, Adaptec's Chairman, President and CEO, said:
"There are many positives to report for the quarter as well. Our
unbroken string of consecutive profitable quarters was extended to 54.
Our OEM SCSI business was strong and we saw acceleration of our Ultra
II design wins. Our new products and technologies, the continuing
strength of SCSI, and our competitive design wins support our
confidence . Accordingly, as we announced today, our Board has
approved a stock repurchase program."
Adaptec, Inc.
Condensed Consolidated Statements of Operations
(unaudited)
Three Months Ended
Dec. 31, Dec. 31,
1997 1996
(In thousands, except per share data)
Net revenues $254,163 $251,703
Cost of revenues 95,304 103,139
-------- --------
Gross profit 158,859 148,564
------- --------
Operating expenses
Research and development 49,282 34,859
Selling, marketing and administrative 64,999 45,042
Write off of acquired in-process
technology and other -- 11,758
-------- --------
114,281 91,659
Income from operations 44,578 56,905
Interest income, net of interest expense 6,349 2,460
-------- --------
Income before income taxes and cumulative
effect of change in accounting principle 50,927 59,365
Provision for income taxes 14,852 17,781
-------- --------
Income before cumulative effect of change
in accounting principle 36,075 41,584
Cumulative effect of change in accounting
principle 9,000 --
-------- --------
Net income $ 27,075 $ 41,584
======== ========
Net income per share - diluted $ 0.23(a) $ 0.36(b)
Weighted average common shares assuming
dilution 124,307 116,786
======== ========
Nine Months Ended
Dec. 31, Dec. 31,
1997 1996
Net revenues $803,693 $668,760
Cost of revenues 307,328 281,735
-------- --------
Gross Profit 496,365 387,025
Operating expenses
Research and development 130,381 93,339
Selling, marketing and administrative 167,506 114,902
Write off of acquired in-process
technology and other -- 80,663
-------- --------
297,887 288,904
Income from operations 198,478 98,121
Interest income, net of interest expense 15,659 7,393
-------- --------
Income before income taxes and cumulative
effect of change in accounting principle 214,137 105,514
Provision for income taxes 55,654 44,779
-------- --------
Income before cumulative effect of change
in accounting principle 158,483 60,735
Cumulative effect of change in accounting
principle 9,000 --
-------- --------
Net income $149,483 $ 60,735
======== ========
Net income per share - diluted $ 1.27(a) $ 0.53(c)
Weighted average common shares assuming
dilution 122,919 114,002
======== ========
(a) Diluted EPS impacted by ($0.07) due to cumulative effect of
change in accounting principle.
(b) Diluted EPS impacted by ($0.10) due to one-time acquisition
charges in fiscal 1997.
(c) Diluted EPS impacted by ($0.69) due to one-time acquisition
charges in fiscal 1997.
Adaptec, Inc.
Condensed Consolidated Balance Sheets
(unaudited)
December 31, 1997 March 31, 1997
(In thousands)
ASSETS
Current assets:
Cash and marketable securities $ 727,977 $ 548,441
Accounts receivable, net 144,776 123,303
Inventories 61,617 53,184
Other current assets 88,807 93,020
---------- ----------
Total current assets 1,023,177 817,948
Property and equipment, net 179,696 141,599
Other assets 89,521 83,947
---------- ----------
$1,292,394 $1,043,494
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $ 1,700 $ 3,400
Note payable 35,280 --
Accounts payable 57,633 52,400
Accrued liabilities 96,336 68,519
---------- ----------
Total current liabilities 190,949 124,319
---------- ----------
Convertible subordinated notes and
long-term debt, net of current portion 230,000 230,850
---------- ----------
Shareholders' equity
Common stock 285,471 251,834
Retained earnings 585,974 436,491
---------- ----------
Total shareholders' equity 871,445 688,325
---------- ----------
$1,292,394 $1,043,494
========== ==========
*T
CONTACT: ADAPTEC
Paul G. Hansen, Christopher G. O'Meara, Bruce Frymire,
408/945-8600
KEYWORD:CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS COMED EARNINGS
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