heres the whole release. midland walwyn was expecting 68 cents and they blew that away.
NEWS RELEASE TRANSMITTED BY CANADIAN CORPORATE NEWS
FOR: ATI TECHNOLOGIES INC.
TSE SYMBOL: ATY
APRIL 9, 1998
ATI Technologies Inc. Reports Record Second Quarter
Results Company Announces 4 for 1 Stock Split
TORONTO, ONTARIO--ATI Technologies Inc. a world leader in 3D
graphics/video acceleration and multimedia solutions, today
announced record results for the company's half year and second
quarter. Sales for the six months ended February 28, 1998 were
$548.9 million, an increase of 74 percent from $315.5 million for
the same period last year. Earnings for the six months rose 217
percent to $80.8 million or $1.52 per share compared with $25.5
million or 50 cents per share for the same period last year. All
per share amounts are expressed on a fully diluted basis.
For the second quarter sales increased 89 percent to $285.5
million and earnings were 79 cents per share, compared with $151.5
million and 24 cents per share for the corresponding quarter of
1997.
"ATI's second-quarter results clearly defines us as the market
leader in Accelerated Graphics Port (AGP) technologies and
products", said K.Y. Ho, ATI's president and CEO, "As a company we
are focused on continuing to lead new technology initiatives,
extend the functionalities of the graphics industry and gain more
market share."
ATI to split stock
Also today, the Board of Directors of ATI announced a four-for-one
split of its common shares to be effected by way of a stock
dividend. Shareholders of record on April 23, 1998 will be issued
a certificate representing three additional common shares for each
common share held on the record date. These certificates will be
distributed commencing on or about April 24, 1998.
Given the strong appreciation in the price of the corporation's
common shares over the past year, the stock dividend enables ATI's
common shares to be more accessible to a wider range of investors.
The stock dividend will increase the number of outstanding ATI
common shares from approximately 48.9 million to approximately
195.9 million.
Financial Highlights
Sales in the second quarter continued to be strong, reflecting the
demand for ATI's RAGE PRO-based products and the company's
penetration into the Top Ten OEMs. ATI experienced good growth in
its component sales across all geographic regions and European
sales of both chips and boards exceeded all historical levels.
Gross margins increased to 37.9 percent for the second quarter up
from 30.5 percent in the same quarter last year. The overall
gross margin increase results from lower material costs and
changes in product sales mix.
Total dollar operating costs increased as a result of larger sales
volumes and our investments in R&D including the addition of the
Tseng Labs development team. As a percentage of sales total
operating costs for the second quarter were 17 percent or $48.6
million compared with 19 percent or $29.1 million in the same
period last year. As a result of strong sales, high gross margins
and operating costs in-line with company budgets, net income rose
to $42.3 million or 15 percent of sales versus $12.5 million or 8
percent of sales.
To support strong sales demand, net working capital rose from
$127.4 million at the end of the second quarter of fiscal 1997 to
$219.1 million at the end of the second quarter of fiscal 1998.
Inventory balances rose to $128.9 million specifically to support
multiple product lines and company-owned material components.
After capital expenditures and ATI's final installment for its
investment in the UICC joint venture, net cash balances increased
$38.3 million in the second quarter to $89.8 million.
Operational Highlights
During the quarter, ATI announced its Microsoft-certified TURBO
Driver for its RAGE PRO chip, a breakthrough in driver technology
that moves ATI's products to the head of the line in terms of 2D,
3D and video performance. The TURBO Driver increased by 40
percent the 3D performance of ATI's RAGE PRO accelerator chip, now
called the RAGE PRO TURBO. As a result ATI's boards and chips
become the fastest on the market among integrated 2D, 3D and video
accelerators with Microsoft-certified drivers.
The company also announced a low-cost 2D, 3D and video chip, the
RAGE IIC AGP controller, ideal for cost-sensitive AGP corporate
systems. The RAGE IIC AGP is pin compatible with ATI's
market-leading RAGE PRO components and makes it possible for
system makers to bring to market fully graphics-enabled computers
under $1,000.
In mid-December, ATI also announced that approximately 40 members
of the graphics development team of Tseng Labs, Inc. would join
the company. In addition, ATI acquired all the graphics design
assets of Tseng and leased its facilities in Pennsylvania. The
Tseng acquisition expedites ATI's strategy of moving to concurrent
development teams worldwide.
About ATI
ATI Technologies Inc., one of only two major suppliers of 3D
graphics and multimedia technology in the world, designs,
manufactures and markets innovative and award-winning multimedia
solutions and graphics components for personal computers. An ISO
9002 company, ATI is one of the world's leading suppliers of video
and 2D/3D graphics accelerators to OEM and retail customers.
Founded in 1985, ATI employs more than 1,200 people at
headquarters in Thornhill, Ontario, and in offices in the United
States, Germany, France, the U.K., Ireland, Malaysia, Taiwan and
Japan. ATI is a public company whose shares trade on the Toronto
Stock Exchange. Visit our web site at atitech.com.
Copyright (c) ATI Technologies Inc., 1998. All company and/or
product names are trademarks and/or registered trademarks of their
respective manufacturers. Features, availability and
specifications are subject to change without notice.
/T/
ATI TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND RETAINED EARNINGS
(Thousands of Canadian dollars, except per share amounts)
Three months ended
February 28
---------------------------------------------------------------
1998 1997
---------------------------------------------------------------
(unaudited)
Sales $285,528 100.0 percent $151,460 100.0 percent
Cost of goods sold 177,227 62.1 percent 105,267 69.5 percent
------- ------------- ------- -------------
108,301 37.9 percent 46,193 30.5 percent
Expenses
Selling and
marketing 25,822 9.0 percent 13,781 9.1 percent
Research and
development 16,040 5.6 percent 10,251 6.8 percent
Administrative 6,727 2.4 percent 5,035 3.3 percent
------- ------------- ------- -------------
48,589 17.0 percent 29,067 19.2 percent
------- ------------- ------- -------------
Income from
operations 59,712 20.9 percent 17,126 11.3 percent
Interest and
other income/(loss) 1,649 0.6 percent 1,953 1.2 percent
Interest expense (25) - (202) (0.1 percent)
------- ------------- ------- -------------
Income before
income taxes 61,336 21.5 percent 18,877 12.4 percent
Income taxes 19,014 6.7 percent 6,418 4.2 percent
------- ------------- ------- -------------
Net income $42,322 14.8 percent $12,459 8.2 percent
---------------------------------------------------------------
Retained earnings
Retained earnings -
beginning
of period $134,714 $61,612
Net income 42,322 12,459
------- -------
Retained earnings -
end of period $177,036 $74,071
---------------------------------------------------------------
Net income per share
Basic $0.87 $0.26
Fully diluted $0.79 $0.24
---------------------------------------------------------------
Six months ended
February 28
---------------------------------------------------------------
1998 1997
---------------------------------------------------------------
(unaudited)
Sales $548,881 100.0 percent $315,528 100.0 percent
Cost of goods sold 344,641 62.8 percent 221,694 70.3 percent
------- ------------- ------- -------------
204,240 37.2 percent 93,834 29.7 percent
Expenses
Selling and
marketing 46,385 8.4 percent 26,984 8.6 percent
Research and
development 29,990 5.5 percent 19,687 6.2 percent
Administrative 13,281 2.4 percent 9,866 3.1 percent
------- ------------- ------- -------------
89,656 16.3 percent 56,537 17.9 percent
------- ------------- ------- -------------
Income from
operations 114,584 20.9 percent 37,297 11.8 percent
Interest and
other income/(loss) 2,540 0.4 percent 1,880 0.6 percent
Interest expense (41) - (220) (0.1 percent)
------- ------------- ------- -------------
Income before
income taxes 117,083 21.3 percent 38,957 12.3 percent
Income taxes 36,296 6.6 percent 13,446 4.2 percent
------- ------------- ------- -------------
Net income $80,787 14.7 percent $25,511 8.1 percent
---------------------------------------------------------------
Retained earnings
Retained earnings -
beginning
of period $96,249 $48,560
Net income 80,787 25,511
------- -------
Retained earnings -
end of period $177,036 $74,071
---------------------------------------------------------------
Net income per share
Basic $1.66 $0.53
Fully diluted $1.52 $0.50
---------------------------------------------------------------
(Weighted average number of common shares: Q2 1998 - 48,883,281;
Q2 1997 - 47,763,439)
(Number of shares outstanding: Q2 1998 - 48,998,331; Q2 1997 -
47,874,061)
ATI TECHNOLOGIES INC.
CONSOLIDATED BALANCE SHEETS
(Thousands of Canadian dollars)
At February 28 At August 31
----------------------------------------------------------------
1998 1997 1997
----------------------------------------------------------------
(unaudited) (audited)
Assets
Current Assets
Cash and cash equivalents $104,022 $73,049 $71,763
Accounts receivable 169,953 88,005 113,744
Inventories 128,869 62,141 41,591
Prepayments and
sundry receivables 9,764 7,515 6,072
------- ------- -------
Total current assets 412,608 230,710 233,170
Capital assets 41,756 26,870 31,085
Investment in joint venture 35,316 27,318 27,480
------- ------- -------
Total assets $489,680 $284,898 $291,735
----------------------------------------------------------------
Liabilities and Shareholders' Equity
Current liabilities
Bank indebtedness $14,265 $42,329 -
Accounts payable
and accrued liabilities 149,237 55,928 73,224
Income taxes payable 30,029 5,050 7,511
------- ------- -------
Total current liabilities 193,531 103,307 80,735
Deferred income taxes 3,500 4,500 5,000
Shareholders' equity
Share capital 115,613 103,020 109,751
Retained earnings 177,036 74,071 96,249
------- ------- -------
Total shareholders' equity 292,649 177,091 206,000
------- ------- -------
Total liabilities
and shareholders' equity $489,680 $284,898 $291,735
----------------------------------------------------------------
ATI TECHNOLOGIES INC.
CONSOLIDATED STATEMENTS OF CHANGES IN FINANCIAL POSITION
(Thousands of Canadian dollars)
Three months ended Six months ended
February 28 February 28
---------------------------------------------------------------
1998 1997 1998 1997
---------------------------------------------------------------
(unaudited) (unaudited)
Cash provided by (used in):
Operating activities:
Net income $42,322 $12,459 $80,787 $25,511
Add items not
affecting working
capital:
Deferred
income taxes (950) 500 (1,500) 700
Depreciation and
amortization 2,414 1,674 4,369 3,185
Long-term portion
of investment
tax credits - 2,188 - 5,770
Net changes in
non-cash working capital
balances relating
to operations:
Accounts
receivable 11,566 15,662 (56,209) (22,607)
Inventories (60,396) (21,317) (87,278) (38,460)
Prepayments
and sundry
receivables (3,483) 135 (3,692) (2,444)
Accounts payable
and accrued
liabilities 47,989 (23,050) 76,013 10,313
Income
taxes payable 14,313 2,211 22,518 4,400
------ ------ ------ ------
53,775 (9,538) 35,008 (13,632)
------ ------ ------ ------
Financing activities:
Issuance of
common shares 3,207 2,728 5,862 3,431
------ ------ ------ ------
Investment activities:
Additions to
capital assets (10,805) (3,493) (15,040) (4,734)
Investment in
Joint Venture (7,836) (17,930) (7,836) (17,930)
------ ------ ------ ------
(18,641) (21,423) (22,876) (22,664)
------ ------ ------ ------
Increase/(Decrease)
in cash 38,341 (28,233) 17,994 (32,865)
Cash position,
beginning of period 51,416 58,953 71,763 63,585
------ ------ ------ ------
Cash position,
end of period $89,757 $30,720 $89,757 $30,720
---------------------------------------------------------------
Cash is defined as cash and cash equivalents, less bank
indebtedness.
/T/
-30-
FOR FURTHER INFORMATION PLEASE CONTACT:
ATI Technologies Inc.
Jo-Anne Chang
Director Investor Relations
(905) 882-2600 Extension 8306
e-mail: Jchang@atitech.ca
INDUSTRY: CPR
SUBJECT: ERN
-0-
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