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Earnings report link, for the record. And here's the text in fixed font.
SyQuest Reports Fiscal 1998 First Quarter Results; Posts Increased Loss on Sequential Quarterly Revenue Growth, Reflecting Product Transition to New SparQ Drive
Business Wire - February 11, 1998 16:34
%SYQUEST-TECHNOLOGY SYQT %CALIFORNIA %COMPUTERS %ELECTRONICS %COMED %EARNINGS V%BW P%BW
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FREMONT, Calif.--(BUSINESS WIRE)--Feb. 11, 1998--SyQuest Technology Inc. (NASDAQ:SYQT), a leading manufacturer of removable cartridge hard drives, today reported net revenue for the first fiscal quarter ended December 31, 1998 of $ 32.1 million, compared to $25.9 million in the preceding quarter and $48.3 million in the same period a year ago.
The company reported a net loss for the first quarter of $39.0 million, or a net loss per share of $0.57, compared with a net loss of $17.8 million, or a net loss per share of $0.33, for the fourth quarter of fiscal 1997 and a net loss of $12.7 million, or a net loss per share of $0.86, for the comparable year-earlier period.
Per-share calculations were based on weighted average shares of 68.9 million in the first quarter of fiscal 1998, 53.8 million in the fourth quarter of fiscal 1997 and 14.7 million in the first quarter of fiscal 1997.
The first-quarter loss reflected production start-up costs and increased advertising to launch SyQuest's new 1-gigabyte SparQ product into the marketplace. Revenues and profits were also affected by competitive price cuts on the SyJet and EZFlyer 230 product lines, a shift in mix away from high-margin legacy products, a short-term yield loss on SyJet cartridges, and component shortages which constrained shipments of SyJet and SparQ products to meet current order backlog.
"First-quarter results were shaped by several adverse factors, from pricing pressures to production delays," said Ed Harper, SyQuest president and CEO. "We also saw a successful product launch of our exciting new SparQ drive, as well as strengthened sales of the SyJet.
"In its first two months on the market, SparQ set a new price-performance standard for removable cartridge drives and won exceptionally strong market acceptance. We plan to significantly accelerate unit growth in the second fiscal quarter.
"We have made a management decision to focus resources on the opportunities created by SparQ, with a strategic transition to this product as the backbone of our corporate future," Harper said.
The company's financial condition as of December 31, 1997 included a cash position of $12.7 million, resulting from previously reported equity financing; improvements in days sales in accounts receivables over the preceding period, and inventory turnover at approximately five turns.
About SyQuest
Based in Fremont, Calif., SyQuest Technology, Inc. has shipped more than 17 million cartridges that people use to expand their ideas and creations. SyQuest(SYQT) is publicly traded on NASDAQ's National Market System. The company's Web site is at syquest.com.
This news release contains forward-looking statements that involve risks and uncertainties, including competition in the marketplace for the company's products and other risks detailed in the SEC reports filed by SyQuest, including its most recent reports on Forms 8K, 10-K and 10-Q.
NOTE TO EDITORS: SyQuest is a registered trademark and the SyQuest logo, SparQ, SyJet and EZFlyer are trademarks of SyQuest Technology, Inc. All other brands or trade names are the property of their respective companies.
SYQUEST TECHNOLOGY, INC.
CONSOLIDATED CONDENSED STATEMENT OF RESULTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
Dec. 31, Dec. 31, Sept. 30,
1997 1996 1997
-------- -------- ---------
Net revenue $ 32,061 $ 48,312 $ 25,917
Cost of revenue 40,633 37,267 25,478
-------- -------- --------
Gross Profit (loss) (8,572) 11,045 439
Operating Expenses:
Selling, general and administrative 23,740 11,328 14,076
Research and development 3,878 5,100 2,566
-------- -------- --------
Total operating expenses 27,618 16,428 16,642
-------- -------- --------
(Loss) from operations (36,190) (5,383) (16,203)
Net interest income (expense) (625) (1,431) (913)
-------- -------- --------
(Loss) before income taxes (36,815) (6,814) (17,116)
Provision for income taxes -- -- 350
-------- -------- --------
Net (loss) (36,815) (6,814) (17,466)
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Value assigned to warrants issued
in conjunction with preferred stock
offerings (2,100) -- --
Preferred stock dividend (80) (573) (280)
Embedded yield on preferred stock -- (5,300) --
-------- -------- --------
Net (loss) applicable to common
stockholders $(38,995) $(12,687) $(17,746)
======== ======== ========
Basic and diluted (loss) per share $ (0.57) $ (0.86) $ (0.33)
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Weighted average shares 68,939 14,673 53,806
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The computation of net loss per share for the quarter ended December
31, 1997 includes adjustments related to the computation of earnings
per share applicable to common stockholders of $2.1 million,
representing the value assigned to warrants issued in connection with
Series 5 preferred stock, and $0.08 million, representing preferred
stock dividends. Absent these financing adjustments, the net loss per
share applicable to the operation of the business was $0.53.
The actual number of common shares outstanding at December 31, 1997
was 71.9 million shares. The actual number of common shares
outstanding at January 30, 1998 was 72.0 million shares.
SYQUEST TECHNOLOGY, INC.
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL CONDITION
(In thousands)
(Unaudited)
Dec. 31, Sept. 30,
1997 1997
-------- ---------
Assets
Current assets:
Cash and cash equivalents $12,677 $ 7,083
Accounts receivable, net 21,302 19,535
Inventories, net 32,602 26,737
Prepaid expenses and deposits 5,778 6,049
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Total current assets 72,359 59,404
Net property, equipment and leasehold improvements 22,957 22,999
Other assets 282 246
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$95,598 $82,649
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Liabilities and Stockholders' Equity
Current liabilities:
Short term borrowings $20,634 $23,291
Accounts payable 32,225 14,800
Accrued expenses and other liabilities 15,136 15,532
Current portion of long-term debt 3,663 4,345
------- -------
Total current liabilities 71,658 57,968
------- -------
Long-term liabilities and Stockholders' equity 23,940 24,681
======= =======
Total liabilities and Stockholders' equity $95,598 $82,649
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CONTACT: Miller/Shandwick Technologies
Fred Hoar, 650/962-9550
fhoar@miller.shandwick.com
or
SyQuest Technology, Inc.
Bob L. Corey, 510/226-4000 |
