Wednesday August 25, 4:47 PM, ADIC Earns Record 22 Cents Per Split Share in Third Quarter as Sales Rise 126 Percent Over Prior Year to $57.2 Million
--SURGE IN GROSS MARGIN LIFTS OPERATING INCOME 25% OVER RECORD SECOND QUARTER --
REDMOND, Wash.--(BUSINESS WIRE)--Aug. 25, 1999-- ADVANCED DIGITAL INFORMATION CORPORATION (Nasdaq:ADIC - news) today announced sales grew by 126 percent to $57.2 million during the third quarter ended July 31, 1999 over the same period last year.
Net income was six times that of third quarter last year at $4.5 million, or 22 cents per diluted share, versus $752,000, or four cents per diluted share. All per share numbers reflect a two-for-one stock split which was effective during the quarter just completed.
''Third quarter results were the best for any period in our history,'' according to Chairman and Chief Executive Officer Peter van Oppen. ''Sales growth persists at high levels and gross margin as a percent of sales improved almost two percentage points over the immediately preceding quarter to a 35 percent,'' he said. Sales grew 5.8 percent over second quarter 1999 levels while operating income grew by almost 25 percent over the same period. The Company attributed the very strong margin performance in the current quarter to a combination of product mix and volume efficiencies, while noting that margins for the year to date period have improved approximately five percentage points over the same nine-month period last year. Both branded and OEM business grew rapidly with OEM business representing approximately 16.9 percent of total sales for the current quarter.
As in the preceding quarter, the Company noted that e-commerce, software and telecommunications infrastructure companies were important elements in sales growth. It was noted that banking, financial services, manufacturing, research and government also continue to be important markets for the Company's open system storage solutions.
Cash increased by $16.9 million during the quarter while growing by $3.4 million over the nine month period. The large third quarter increase reflects net increased short and long-term borrowings of $8.3 million, quarterly earnings and non-cash expenses of $5.7 million, effects from more efficient use of working capital as well as cash from the exercise of stock options during the period. These increases in cash were partially offset by investments made during the quarter, including the Company's $7.0 million investment in @Backup, an Internet-based backup and data access service company.
With more than 45,000 automated tape libraries installed as well as a suite of innovative software solutions and Storage Area Networking (SAN) products, ADIC is a leading global provider in the growing market to manage and protect information in computer networks. Marketed under ADIC, ADIC/GRAU and OEM partner brands, including Dell, Exabyte and Unisys, the Company's automated tape libraries are available with DLTtape(TM), D2, half-inch, AIT, 4mm and 8mm tape technologies and are supported by leading backup and storage management software products for Windows NT, UNIX and MVS operating systems. The Company's own storage management tools include AMASS(TM) direct data access software which provides network users shared access to information stored in automated libraries. A pioneer in marketing products for Storage Area Networks, ADIC offers Fibre Channel routers and tape libraries with direct Fibre Channel connectivity. Further product information is available via the Internet at adic.com.
This release contains forward-looking statements relating to the Company's existing and future products and services and future operating results that are subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. The words ''believe'', ''expect'', ''intend'', ''anticipate'', variations of such words, and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect the Company's actual results include general economic trends, year 2000 issues, technical competition or obsolescence, supply constraints, changes in market pricing and production problems. Reference is made to the Company's Registration Statement on Form S-3 filed with the SEC on August 6, 1999 for a more detailed description of such factors. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
ADIC, FastStor, Scalar and AMASS are trademarks of Advanced Digital Information Corporation. DLT is a trademark of Quantum Corporation. All other product or company names should be considered the property of their owners.
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(In thousands, except for per share amounts)
Three months ended Nine months ended
July 31, July 31,
(Unaudited) (Unaudited)
1999 1998 1999 1998
-------- -------- -------- --------
Net sales $ 57,191 $ 25,314 $160,379 $ 72,986
-------- -------- -------- --------
Cost of sales 37,075 18,544 105,830 51,791
-------- -------- -------- --------
Gross profit 20,116 6,770 54,549 21,195
Selling and administrative
expenses 9,408 4,978 27,502 12,944
Research and development
expenses 3,440 818 9,490 2,063
-------- -------- -------- --------
Operating profit 7,268 974 17,557 6,188
Other income 40 159 472 1,238
Income before provision
for income taxes 7,308 1,133 18,029 7,426
Provision for income taxes 2,663 381 6,504 2,379
Minority interest 98 -- 381 --
-------- -------- -------- --------
Net income $ 4,547 $ 752 $ 11,144 $ 5,047
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Basic net income per share $ 0.23 $ 0.04 $ 0.56 $ 0.26
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Diluted net income per share $ 0.22 $ 0.04 $ 0.54 $ 0.25
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Shares used in computing
basic net income per share 19,976 19,512 19,731 19,460
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Shares used in computing
diluted net income per
share 21,025 19,810 20,496 19,810
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ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
July 31, 1999 Oct. 31, 1998
(Unaudited)
-------- --------
ASSETS
Current assets:
Cash $ 31,658 $ 28,226
Accounts receivable, net 34,764 31,797
Inventories, net 34,078 32,294
Other current assets 4,261 4,975
-------- --------
Total current assets 104,761 97,292
-------- --------
Property, plant and equipment, net 7,893 7,351
Investment and other assets 17,022 7,764
-------- --------
$129,676 $112,407
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 43,366 $ 30,711
Long-term debt and other
long-term liabilities 9,102 18,668
Minority interest 406 25
Shareholders' equity 76,802 63,003
-------- --------
$129,676 $112,407
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