EArnings are out. Maybe that's what's moving this stock.
Ampex Corporation Reports Third Quarter Net Income
of $3.1 Million and Earnings of $0.07 Per Share
REDWOOD CITY, Calif.--(BUSINESS WIRE)--Oct. 21, 1996-- Ampex Corp reported today
net income of approximately $3.1 million on sales of $23.6 million, for the third quarter of 1996,
resulting in fully diluted earnings per share of $0.07, after deducting expenses for previously
disclosed patent infringement litigation with a foreign consumer products manufacturer of
approximately $0.05, and moving expenses of approximately $0.01 per share for the quarter.
In the third quarter of 1995, the company reported net income of $3.4 million, on sales of $23.4
million, and fully diluted earnings per share of $0.09. There were no patent infringement
litigation or moving costs during the third quarter of 1995.
Earnings for the third quarter of 1996 increased due to income from non-recurring royalty
settlements relating to prior periods of approximately $0.02 per share and restructuring credits of
approximately $0.01 per share.
During the third quarter of 1995, the company recorded a gain of approximately $0.03 per share
as a result of transactions relating to facilities that it had vacated in connection with its 1993
restructuring of operations.
The increase in selling and administrative expenses of $2.0 million for the third quarter of 1996
compared to the third quarter of 1995 was entirely related to the ongoing patent infringement
litigation with a foreign consumer products manufacturer.
Sales of 19 millimeter data storage and instrumentation products more than doubled between
comparable quarterly periods and offset declines in sales of other instrumentation recorders and
of professional television and television aftermarket products.
Gross margin percentages for the third quarter 1996 decreased to 46.7% from 48.0% for the
third quarter of 1995 due to the company's previously announced decision to lower prices of its
19 millimeter data storage and instrumentation products to broaden their appeal to emerging
commercial mass data storage applications.
For the nine months ended Sept. 30, 1996, Ampex generated net income of $10.5 million on
sales of $72.3 million, and fully diluted earnings per share of $0.24, compared to net income of
$14.9 million on sales of $71.6 million, and fully diluted earnings per share of $0.35 for the
comparable period in 1995.
Patent infringement litigation reduced earnings by approximately $0.06 per share, and moving
costs reduced earnings by approximately $0.01 per share for the nine months ended Sept. 30,
1996. There were no patent litigation or moving costs during the comparable period in 1995.
Nonrecurring royalty settlements related to prior periods increased earnings by approximately
$0.04 per share and restructuring credits increased earnings by approximately $0.01 per share in
the nine months ended Sept. 30, 1996. Income in the nine months ended Sept. 30, 1995 was
increased by nonrecurring royalty settlements of approximately $0.21 per share and restructuring
credits of approximately $0.02 per share.
Ampex Corp. is one of the world's leading innovators in the fields of magnetic recording, image
processing and high-performance digital storage. Ampex is currently focusing its technology on
the emerging market for mass data storage in the visual information age.
During its 52-year history of innovation, Ampex has been granted thousands of patents and
numerous awards for technical achievement. Headquartered in Redwood City, Calif., Ampex's
customers today include such leading organizations as Boeing, Eastman Kodak, Mobil Oil, Time
Warner and NASA.
Any statements contained herein that are not historical facts are forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995, and involve risks and
uncertainties. Information on potential factors which could affect the company's actual results of
operations are included in its filings with the Securities and Exchange Commission, including but
not limited to its Annual Report on Form 10-K for the fiscal year ended Dec. 31, 1995, its
Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 1996, and its Quarterly
Report on Form 10-Q for the fiscal quarter ended June 30, 1996, and its Quarterly Report on
10-Q for the fiscal quarter ended Sept. 30, 1996, which is expected to be filed shortly.
Ampex Corporation
Consolidated Statements of Operations
(in thousands, except share data)
(unaudited)
Three months ended Nine Months ended
Sept. 30, Sept. 30,
1996 1995 1996 1995
Net sales $ 23,604 $ 24,431 $ 72,256 $ 71,589
Cost of sales 12,581 12,192 39,470 39,281
Gross profit 11,023 11,239 32,786 32,308
Selling and administrative 7,511 5,553 19,329 16,741
Research, development and
engineering 3,962 3,504 11,786 11,670
Royalty income (3,023) (928) (7,584) (13,587)
Restructuring charges
(credits) (453) (1,087) (453) (1,087)
Operating income 3,026 4,197 9,708 18,571
Interest expense 26 957 729 2,835
Amortization of debt
financing costs - 23 85 103
Interest income (824) (264) (2,400) (854)
Other (income) expense, net 216 10 (422) 58
Income before income taxes 3,608 3,471 11,716 16,429
Provision for income taxes 505 110 1,168 1,483
Net income $ 3,103 $ 3,361 $ 10,548$ 14,946
Primary income per share:
Income per share $ 0.07 $ 0.09 $ 0.24 $ 0.41
Weighted average number
of common shares
outstanding 46,227,048 36,971,923 44,082,092 34,376,239
Fully diluted income
per share:
Income per share $ 0.07 $ 0.09 $ 0.24 $ 0.35
Weighted average number
of common shares
outstanding 46,280,192 45,665,048 46,152,259 47,786,546
Ampex Corporation
Consolidated Balance Sheets
(in thousands, except share data)
(unaudited)
Sept. 30, Dec. 31,
1996 1995
ASSETS
Current assets:
Cash and cash equivalents $ 5,148 $ 6,765
Short-term investments 18,716 12,885
Notes receivable 8,476 --
Accounts receivable (net of allowances
of $2,078 and $2,541) 17,741 15,394
Inventories 16,702 12,512
Other current assets 2,745 2,915
------ ------
Total current assets 69,528 50,471
Property, plant and equipment 8,288 37,759
Other assets 9,626 421
------ ------
Total assets $87,442 $88,651
======= =======
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable $1,075 $2,246
Accounts payable 9,528 9,745
Income taxes payable 398 1,334
Accrued restructuring costs 1,752 2,464
Other accrued liabilities 22,675 23,940
------ ------
Total current liabilities 35,428 39,729
Long-term debt 1,139 31,585
Other liabilities 65,478 65,080
Deferred income taxes 1,375 1,379
Accrued restructuring costs 6,377 8,265
------- -------
Total liabilities 109,797 146,038
======= =======
Redeemable nonconvertible preferred stock,
$1,000 liquidation value:
Authorized: 69,970 shares 1996 and 1995
Issued and outstanding - 69,970 shares
1996 and 1995 69,970 69,970
Stockholders' deficit:
Preferred stock, $1.00 par value:
Authorized: 842,838 shares 1996 and 1995
Issued and outstanding - none 1996 and
1995 -- --
Common stock, $.01 par value:
Class A:
Authorized: 125,000,000 shares 1996
and 1995
Issued and outstanding - 45,007,817 shares
1996; 32,309,662 shares 1995 450 323
Class C:
Authorized: 50,000,000 shares 1996
and 1995
Issued and outstanding - none 1996;
2,107,807 shares 1995 -- 21
Other additional capital 379,206 355,172
Note receivable from stockholder (1,779) (2,053)
Accumulated deficit (457,064) (467,612)
Cumulative translation adjustments 515 445
Minimum pension liability adjustment (13,653) (13,653)
--------- ---------
Total stockholders' deficit ( 92,325) (127,357)
--------- ---------
Total liabilities and stockholders'
deficit $87,442 $88,651
========= ========
CONTACT: Ampex Corporation, Redwood City
Karen Schweikher, 415/367-4111 |
