MTIC Reports Earnings - Beats estimate:
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News Released Today shown Below:
MTI Technology Corporation Reports Fiscal 2001 Second Quarter and Six Months Results
Total Revenues Up 26% Sequentially From Fiscal First Quarter 2001 Gross Margins Rebound To 36%, Up From 32% in Fiscal First Quarter 2001
ANAHEIM, Calif., Oct 17, 2000 (BUSINESS WIRE) -- MTI Technology Corp. (Nasdaq: MTIC chart, msgs), a leading provider of enterprise storage solutions, today announced financial results for the fiscal 2001 second quarter and six months ended September 30, 2000.
For the fiscal 2001 second quarter ended September 30, 2000, MTI reported total revenues of $47.6 million, compared to revenues of $54.3 million for the comparable quarter last year and $37.9 million for the first quarter of fiscal 2001. Net product revenue for the second quarter 2001 was $34.9 million, compared to $41.9 million in the year ago period and $25.4 million in the immediately preceding quarter. Service revenue for the second quarter 2001 was $12.7 million, compared to $12.4 million in the year ago period and $12.5 million in the first quarter of fiscal 2001.
Gross profit margin for the second quarter 2001 was 36.4% compared to 41.3% in the same period last year and up from 32.2% for the first quarter of fiscal 2001.
The company reported a net loss for the second quarter of fiscal year 2001 of $2.1 million, or $0.07 per diluted share, compared to net income of $5.1 million, or $0.16 per diluted share, in the second quarter of fiscal 2000.
"We entered this quarter facing a key challenge," said Tom Raimondi, president and chief executive officer. "We had to focus on replacing business that had been lost as a result of the dramatic slowdown in the dot.com market. We are marketing to many new accounts and believe we are building strong customer relationships with a number of global 2000 companies. We expect this customer shift to build, further diversifying our customer base in the future."
For the six months ended September 30, 2000, MTI reported total revenues of $85.5 million, compared to revenues of $107.6 million for comparable period last year. Net product revenue for the first six months of fiscal 2001 was $60.3 million, compared to $83.3 million in the year ago period. Service revenue for the six months ended September 30 was $25.2 million, compared to $24.3 million in the year ago period.
The company reported a net loss for the first six months of fiscal year 2001 of $10.9 million, or $0.34 per diluted share, compared to net income of $8.6 million, or $0.27 per diluted share, in the first six months of fiscal 2000.
MTI's European results were another positive highlight of the quarter, with sales of $16.1 million for the quarter, up from $11.2 in the previous quarter, and ahead of plan. "The changes that we put in place in Europe earlier this year have begun to pay off. Europe remains a vital market, and I believe that we now have the needed sales and management leadership to grow in this key region," remarked Paul Emery, chief operating officer and acting chief financial officer.
The company's balance sheet remains strong, with $15.7 million in cash, no long term debt, over $40 million of working capital and an available and unused line of credit of $30 million. Net accounts receivable have improved 9% from the prior quarter and were 42% better than the last fiscal year end.
Raimondi emphasized that MTI remains in a building mode, and that the increasing focus on global 2000 customers is expected to drive revenue growth in the balance of fiscal 2001 and beyond. "The storage industry continues to experience robust demand, and MTI is well positioned to resume its strong growth path. Momentum with global 2000 companies has increased as their incremental storage needs are identified. Consequently we expect activity in the third fiscal quarter to be robust."
"Product development initiatives continue on proprietary and value added products. We remain committed to our goals of offering the best value and most complete storage solutions in the marketplace. MTI anticipates introducing new product offerings in the near future," concluded Raimondi.
About MTI Technology Corporation
MTI's mission is to provide Continuous Access to Online Information(SM) through fault-tolerant, cross-platform data storage servers for the enterprise. MTI develops, manufactures, sells and services data server solutions for Global 2000 companies on a worldwide basis. Headquartered in Anaheim, Calif., the company offers services and support from more than 40 offices in the United States and Europe and complies with ISO 9001 quality system standards. For more information, please visit the company's web site at www.mti.com.
This press release includes forward-looking statements, including statements regarding the company's customer base, European operations, growth domestically and abroad, market, composition of customer base, products, product development initiatives, and pipeline of potential business, which are subject to change. The actual results may differ materially from those described in any forward-looking statement. In particular, there can be no assurance that MTI will diversify its customer base, grow European or domestic operations and revenue, introduce products on time, or at all, or that such products will achieve market acceptance. Important factors that may cause actual results to differ are set forth in the company's periodic filings with the U.S. Securities and Exchange Commission including its Form 10-K for the year ended April 1, 2000.
Note to Editors: MTI is a registered trademark and Continuous Access to Online Information is a service mark of MTI Technology Corp. All other company, brand or product names are registered trademarks or trademarks of their respective holders.
MTI TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS of DOLLARS, EXCEPT PER SHARE DATA)
(UNAUDITED)
September 30 April 1,
2000 2000
--------- ---------
ASSETS
Current assets:
Cash and cash equivalents 15,671 8,791
Accounts receivable, net 43,394 74,289
Inventories 28,731 25,515
Deferred income tax benefit 1,020 1,020
Prepaid expenses and other receivables 7,807 6,407
--------- ---------
Total current assets 96,623 116,022
Property, plant and equipment, net 16,593 14,464
Deferred income tax benefit 30,620 26,715
Investment in affiliate 12,042 14,304
Goodwill, net 5,897 8,998
Other 472 444
--------- ---------
Total assets 162,247 180,947
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Notes payable -- 1,500
Leases payable 143 --
Accounts payable 21,263 22,008
Accrued liabilities 15,107 20,372
Deferred income 16,676 20,708
--------- ---------
Total current liabilities 53,189 64,588
Other 4,528 2,864
--------- ---------
Total liabilities 57,717 67,452
Stockholders' equity:
Preferred stock, $.001 par value;
authorized 5,000 shares;
issued and outstanding, none -- --
Common stock, $.001 par value;
authorized 80,000 shares; issued
(including treasury shares) and
outstanding 32,660 and 32,352 shares
at September 30, 2000 and April 1,
2000, respectively 33 32
Additional paid-in capital 134,914 133,007
Accumulated deficit (25,476) (14,609)
Less cost of treasury stock (431 and
479 shares at September 30, 2000 and
April 1, 2000, respectively) (1,563) (1,745)
Accumulated other comprehensive loss (3,378) (3,190)
Total stockholders' equity 104,530 113,495
--------- ---------
Total liabilities and stockholder's equity 162,247 180,947
========= =========
MTI TECHNOLOGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS of DOLLARS, EXCEPT PER SHARE DATA)
(UNAUDITED)
THREE MONTHS ENDED SIX MONTHS ENDED
-------------------- --------------------
September 30, October 2, September 30 October 2,
2000 1999 2000 1999
-------- -------- -------- --------
Net product revenue 34,850 41,921 60,293 83,290
Service revenue 12,739 12,404 25,206 24,275
-------- -------- -------- --------
Total revenue 47,589 54,325 85,499 107,565
Product cost of
revenue 21,438 24,499 38,585 51,129
Service cost of
revenue 8,816 7,396 17,389 14,797
-------- -------- -------- --------
Total cost of revenue 30,254 31,895 55,974 65,926
Gross profit 17,335 22,430 29,525 41,639
Operating expenses:
Selling, general and
administrative 15,898 13,968 34,734 26,410
Research and
development 4,371 4,065 9,556 7,581
-------- -------- -------- --------
Total operating
expenses 20,269 18,033 44,290 33,991
-------- -------- -------- --------
Operating income
(loss) (2,934) 4,397 (14,765) 7,648
Other income, net 1,272 1,141 2,257 2,177
Equity in net loss of
affiliate 1,168 461 2,262 461
-------- -------- -------- --------
Income (loss) before
income taxes (2,830) 5,077 (14,770) 9,364
Income tax expense
(benefit) (705) -- (3,905) 729
-------- -------- -------- --------
Net income (loss) (2,125) 5,077 (10,865) 8,635
======== ======== ======== ========
Net income (loss) per
share:
Basic (0.07) 0.17 (0.34) 0.29
======== ======== ======== ========
Diluted (0.07) 0.16 (0.34) 0.27
======== ======== ======== ========
Weighted-average
shares used in per
share computations:
Basic 32,225 30,025 32,155 29,394
======== ======== ======== ========
Diluted 32,225 32,693 32,155 31,818
======== ======== ======== ========
Contact:
Lillian Armstrong, 415/433-3777
lillian@lhai-sf.com
David Barnard, 415/433-3777 (CFA)
david@lhai-sf.com
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