To: Mark Adams who wrote (4844 ) 1/10/2000 6:26:00 PM From: Mark Adams Read Replies (1) | Respond to
RDRT announces results, but perhaps more importantly comments on the rather short leash the bankers appear to have in place.Read-Rite paid back $41.2 million under its bank credit facility during the December quarter, with total borrowings under the facility at $101.3 million. Accounts receivable balances increased by $31 million as the GMR ramp was completed during the December quarter, and inventory grew by $11.2 million from September levels as the company prepares for strong revenue growth in the second fiscal quarter. Read-Rite ended the quarter with cash balances of $114.2 million. With respect to its bank credit facility, the company obtained a waiver through February 25, 2000 ; consequently, the bank debt is treated as a current liability. As a result, the company's auditors have included an explanatory paragraph in their audit report filed with the fiscal year 1999 Form 10K which is being submitted today to the Securities and Exchange Commission. Read-Rite is currently in negotiation with the bank group to amend the facility and believes its ability to control expenditures and to secure financing will be sufficient to fund its operations throughout the current fiscal year. The company remains focused on the cost structure at its factories and will take appropriate actions to improve efficiency and productivity at these locations.
