Yippee!!
( BW)(CA-SANDISK)(SNDK) SandDisk Announces Record
Revenue, Net Income and Earnings Per Share for Fourth
Quarter 1999
Business Editors/High-tech Writers
SUNNYVALE, Calif.--(BUSINESS WIRE)--Jan. 26, 2000--SanDisk
Corporation (Nasdaq:SNDK), the world's largest supplier of flash
memory data storage products, today announced record revenue for its
quarter ended December 31, 1999.
Total fourth quarter revenues were $82.8 million, an increase of
23% from the third quarter of 1999 due primarily to increased sales of
CompactFlash products and higher revenues from licenses and royalties.
Revenues from licenses and royalties were $12.9 million, up 30% from
$9.9 million in the prior quarter. Net income for the quarter was
$10.0 million, up 54% from $6.5 million in the third quarter of 1999.
Diluted earnings per share was $0.30, up 43% from the $0.21 per share
for the third quarter of 1999.
Total fourth quarter revenues increased $44.6 million, or 117%,
over total revenues of $38.2 million for the same period last year.
Product revenues increased by 132% compared to the same period of the
prior year and license and royalty revenues increased by 59%. Current
quarter diluted earnings per share increased 130% compared to $0.13
per share for the fourth quarter of 1998.
Revenues for fiscal 1999 were $247 million, an increase of 82%
from $135.8 million for the previous year due to higher product sales
and higher revenues from licenses and royalties. Product revenues
increased 99% due primarily to increased sales of CompactFlash and
MultiMediaCard products. Net income in 1999 was $26.6 million, or
$0.86 per share, compared with $11.8 million, or $0.43 per share for
1998 on a diluted basis. SanDisk's balance sheet remains strong with
cash and investments of $460 million and no debt.
"The fourth quarter was an excellent quarter for SanDisk" said
Dr. Eli Harari, President and CEO of SanDisk. "New records were
achieved in product and royalty revenues, units and megabytes shipped,
net income and earnings per share. We shipped 36% more megabytes over
the previous quarter, making this the seventh consecutive quarter of
record megabyte shipments. Product gross margins increased to 27% from
24% in the third quarter due to the improved cost structures of our
128Mbit and 256Mbit products, which offset a decline of 3% in the
sales price per megabyte shipped. Product gross margins are projected
to further improve in the first quarter, primarily on the strength of
our 256Mbit production and projected higher volumes.
"Sales growth was particularly strong in Q4 in the North America
and European regions. Revenues from the retail channel represented 34%
of product sales during this holiday season quarter, representing
almost as much revenue as in the three prior quarters combined. The
key contributor was CompactFlash sold into digital cameras, which were
a hot seller this holiday season. Order backlog at year-end was at an
all time high. We are booked for the first quarter and for a
substantial portion of the second quarter's revenue. The pricing
environment is stable.
"Fiscal year 1999 was a very good year for SanDisk. We doubled
revenues, approaching the quarter billion dollar mark and doubled
earnings per share. We made major strides in penetrating the retail
channel and successfully executed the 64Mbit to 128Mbit to 256Mbit
technology transitions into high volume production in less than twelve
months. We launched with Matsushita and Toshiba the Secure Digital
Memory Card and established a strategic cooperation with Toshiba for
the joint development and joint manufacturing of gigabit density flash
memory. We believe that SanDisk's target markets are entering a strong
growth phase, fueled by the accelerating convergence of consumer
electronics, internet and wireless. These new and exciting markets
represent immense opportunities for sustainable growth for SanDisk in
the years ahead. We are optimistic about strong growth in our sales
and profits in fiscal 2000."
This news release contains forward looking statements including
the Company's expectations for future product revenues and bookings,
average selling prices, gross margin and profits that are based on
current expectations and involve risks and uncertainties that may
affect the Company's business, financial condition and results of
operations. In addition to the factors discussed above, other risks
include: future average selling price erosion due to excess capacity
and price competition; the timely introduction and acceptance of new
consumer products that incorporate the Company's flash storage
devices; seasonality of product sales; the timely and successful
manufacturing ramp up of new product generations with acceptable
yields and lower manufacturing costs; the availability of adequate
supply of flash memory wafers from UMC in Taiwan and of other critical
materials and components; the successful ramp up of assembly
operations in China and Taiwan; success in developing brand name
preference and an efficient distribution system for SanDisk's products
in the retail channel; economic conditions and exchange rates in
Japan, the Pacific Rim and other geographic regions as they affect
SanDisk's customers; the successful negotiation of a definitive
agreement with Toshiba on the announced memo of understanding
regarding joint development and manufacturing of advanced flash
memories; the successful signing of a definitive agreement with
Matsushita and Toshiba for the Secure Digital memory card; and the
other risks detailed from time to time in the Company's Securities and
Exchange Commission filings and reports, including, but not limited
to, the Form 10Q for the quarter ended September 30, 1999 and the
Annual Report on Form 10-K for the year ended December 31, 1998.
Future results may differ materially from those previously reported.
The Company assumes no obligation to update the information in this
release.
SanDisk Corporation designs, develops and markets flash memory
data storage products used in a wide variety of electronic systems.
The Company has optimized its flash memory storage solution, known as
"system flash", to address the needs of many emerging applications in
the consumer electronics and industrial/communications markets. The
Company's products include removable CompactFlash products and
FlashDisk cards, embedded FlashDrives and Flash ChipSet products and
MultiMediaCards. SanDisk is based in Sunnyvale.
SanDisk's web site/home page address: sandisk.com
Note to Editors:CompactFlash and CF are trademarks of SanDisk
Corporation.
-0-
*T
SanDisk Corporation
Condensed Consolidated Statements of Income
(In thousands, except per share data)
Three months ended Year ended
December 31, December 31,
1999 1998 1999 1998
---------- --------- ------------------
Revenues:
Product $ 69,920 $30,141 $205,770 $103,190
License and royalty 12,851 8,079 41,220 32,571
---------- --------- ------------------
Total revenues 82,771 38,220 246,990 135,761
Cost of sales 50,879 23,139 152,143 80,311
---------- --------- ------------------
Gross profits 31,892 15,081 94,847 55,450
Operating expenses:
Research and development 8,721 4,564 26,883 18,174
Sales and marketing 7,719 4,770 25,294 16,933
General and administrative 4,204 1,944 12,585 7,533
---------- --------- ------------------
Total operating expenses 20,644 11,278 64,762 42,640
Operating income 11,248 3,803 30,085 12,810
Interest and other income, net 3,719 1,781 9,541 5,681
---------- --------- ------------------
Income before taxes 14,967 5,584 39,626 18,491
Provision for income taxes 4,939 2,010 13,076 6,655
========== ========= ==================
Net income $ 10,028 $ 3,574 $26,550 $11,836
========== ========= ==================
Earnings per share
Basic $ 0.33 $ 0.13 $ 0.95 $ 0.45
Diluted $ 0.30 $ 0.13 $ 0.86 $ 0.43
Average common shares
outstanding
Basic 30,642 26,592 27,917 26,298
Diluted 33,539 27,439 30,716 27,672
SanDisk Corporation
Condensed Consolidated Balance Sheets
(In thousands)
ASSETS December 31, 1999 December 31, 1998
----------------- -----------------
Current Assets:
Cash and cash equivalents $ 146,170 $ 15,384
Short-term investments 313,346 119,074
Accounts receivable, net 52,434 20,400
Inventories 35,679 8,922
Deferred tax assets 17,000 15,900
Prepaid expenses and other current assets 3,761 6,694
------------ -------------
Total current assets 568,390 186,374
Property and equipment, net 31,788 17,542
Investment in foundry 51,208 51,208
Deposits and other assets 6,338 617
----------- -------------
Total Assets $ 657,724 $ 255,741
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 30,734 $ 6,938
Accrued payroll and related expenses 8,259 3,768
Other accrued liabilities 17,221 9,745
Deferred revenue 29,383 27,452
------------- -------------
Total current liabilities 85,597 47,903
Stockholders' Equity:
Common stock 524,131 186,120
Retained earnings 47,996 21,718
------------ -------------
Total stockholders' equity 572,127 207,838
Total Liabilities and
Stockholders' Equity $ 657,724 $ 255,741
============ =============
--30--ah/sf* eb/sf
CONTACT: SanDisk
Cindy Burgdorf, 408/542-0577
KEYWORD: CALIFORNIA
INDUSTRY KEYWORD: COMPUTERS/ELECTRONICS HARDWARE EARNINGS |
