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Technology Stocks : Western Digital (WDC) -- Ignore unavailable to you. Want to Upgrade?

To: Harold S. who wrote (8825)	2/26/1998 12:23:00 AM
From: David Harker	Read Replies (2) \| Respond to of 11057

All: 2/24 speech by CEO Chuck Haggerty A few very recent quotes from Chuck Haggerty: Bad News -> "There's going to be a lot more pain before this is over" and Good News -> "The local Enterprise Storage Group already is supplying the majority of high-capacity disk drives used in network servers made by Compaq and Dell" WDC has a Division based in Rochester, MN (where I live). The CEO of Western Digital, Chuck Haggerty, spoke to the "business community" of Rochester on Tuesday (2/24). Two articles in the Rochester Post-Bulletin summarized his talk, and I quote from them below. (Mr. Haggerty grew up in Rochester). The Post-Bulletin has a web site, but it is not complete at all, and only has "teasers" - fragments of articles, and does not mention these articles at all - so no help there. URL is: www.postbulletin.com (I repeat, the articles aren't there) The two articles were both written by P-B writer Bob Freund. I've typed in nearly all of each article, typos are mine, if any. I own a bunch of WDC stock... Basically, good news in article #1, bad news (Asia's effects) in #2. ============================= Title: "Western Digital CEO lauds local plant" "Western Digital Corp's problems in the disk drive business don't extend to its new, Rochester-based division, the company's chairman said Tuesday." "The local Enterprise Storage Group already is supplying the majority of high-capacity disk drives used in network servers made by Compaq and Dell, only 16 months after releasing its first product, said Chuck Haggerty, also Western Digital's chief executive officer." "In a speech to business customers of First Bank Rochester, he described the start-up of the division as 'spectacular...by any measure of our industry'." "Western Digital now employs about 1,450 workers at two design sites in Rochester and a factory in Singapore. About 350 of those are at Rochester, with the company expected to recruit about another 50 this year." ...(para's telling that this Div. makes 9Gig drives, is profitable, and how Haggerty grew up in Roch - nothing new)... "Haggerty said Western Digital increased the size of its previously announced $275 million bond issue last month to more than $400 million, partly because of interest in the Enterprise group's products from large institutions." ...(para on new local plant to be built for this Division in Roch, announced several months ago, discussed then on this thread)... "However, Haggerty also said he sees price problems in the desktop segment of the market, which is the bulk of WD's business, continuing until at least late summer." "He said the company should have converted 80% of its production to new MR head technology by the end of June." ...(a few more para's of industry background...end of article 1)... ======================= Title: Western Digital CEO warns of ripple effects from Asian crisis "Clouds have gathered thick over the Asia-Pacific region, and we're not talking El Nino, Western Digital's top executive says." "The full-blown financial storms that are roiling many Pacific Rim nations now appear likely to last as long as two or three years, Chuck Haggerty projected Tuesday." ...(skipped para. on background info on Asian currency crisis)... "'There's going to be a lot more pain before this is over,' he said, speaking to more than 200 business customers of First Bank Rochester." "Governments will have to reform banking systems - some rife with cronyism - and perhaps whole economies, said Haggerty, whose California-based company produces computer disk drives in Singapore and other Far East locations." "Although an ocean away, the United States also is likely to feel ripple effects, Haggerty said." "A flood of low-price Asian goods 'could be very serious,' Haggerty warned. At the same time, the robust U.S. economy likely can absorb some increase in Asian imports. The Pacific Rim crisis 'probably isn't a violent storm (for the U.S.), but there are going to be storms' in vulnerable industries, he said." "Western Digital likely can weather the storm overseas with minor damage, Haggerty said. The company makes only about a tenth of its Asian sales in the most troubled nations, while comparatively stable Japan accounts for about 60% of its business in the region." "Western Digital and its competitors also are struggling with a major industry crisis. An oversupply of disk drives has sent product prices - and stock prices - plunging during the past year." "It probably will be August or September before prices stabilize, Haggerty said. Disk drive industry analysts are projecting Western Digital will show losses in its next two quarterly reports". <the end>