Micron Technology Inc.'s Ratings Placed on S&PWatch,Negative
Wednesday March 18, 1:46 pm Eastern Time
Company Press Release
SOURCE: Standard & Poor's CreditWire
Micron Technology Inc.'s Ratings Placed on S&PWatch,
Negative
NEW YORK, March 18 /PRNewswire/ -- Standard & Poor's today placed its ratings of Micron
Technology Inc. (Micron) on CreditWatch with negative implications (see list below).
The action follows Micron's announced material earnings decline for its fiscal second quarter ended
Feb. 26, 1998, and Standard & Poor's expectations that market conditions will remain pressured
over the near to intermediate period.
Boise, Idaho-based Micron is a manufacturer of semiconductor memory chips and, through its 64%
owned Micron Electronics Inc. [Nasdaq:MUEI - news] subsidiary, manufactures and
direct-markets personal computers. Semiconductor memory revenues declined 35% from the
previous quarter, reflecting continued industry-wide severe price pressures and lower volumes due
to insufficient chip testing equipment. Micron Electronics' personal computer operations reported
negative gross margins, as the company's notebook PCs were sold below cost. High operating
expenses contributed to Micron's $208 million operating loss for the quarter, on $733 million in
sales. Proceeds of $237 million from the 90% sale of Micron Electronics' contract manufacturing
operation during the quarter contributed to liquidity. Cash balances of $935 million at Feb. 26,
1998, unchanged from the previous quarter, provide adequate near-term liquidity.
Standard & Poor's will meet with management to assess the company's plans to restore operating
profitability levels in the two businesses. -- CreditWire.
RATINGS PLACED ON CREDITWATCH WITH NEGATIVE IMPLICATIONS
Micron Technology Inc.
Corporate credit rating BB
Bank loan BB
Subordinated debt B+
Mixed shelf registration (Preliminary) BB/B+
SOURCE: Standard & Poor's CreditWire |
