As the day goes on, the stock recovers on heavy volume. Here is the release. Matthew
Diamond Multimedia Reports Strong Results for the First Quarter Ended March 31, 1998
SAN JOSE, Calif.--Diamond Multimedia Systems, Inc. (NASDAQ:DIMD), a leader in the interactive multimedia acceleration, today reported financial results for the first quarter ended March 31, 1998.
For the quarter, net revenues were $186.2 million, up 66 percent from $112.4 million for the first quarter of 1997. Net income for the first quarter was $7.9 million, or $0.22 per share on a fully diluted basis, compared to a net loss of $6.0 million, or $0.17 per share in the first quarter of 1997.
"We are pleased with the progress we made this quarter. We achieved strong results in both revenues and profits. We launched a number of new products during the quarter, including the award winning Monster 3D II graphics accelerator, our first V.90 and PCI modems and our family of PCI DirectSound audio products. And, we announced a number of new OEM relationships, including Dell Computer," said William J. Schroeder, president and CEO.
"While first quarter revenues were essentially the same sequentially, up about $300,000 from a strong fourth quarter, net income was up 13 percent due to higher gross margins and lower operating expenses," stated James M. Walker, senior vice president and CFO.
"Continued demand for both high-performance multimedia acceleration and communications products contributed to a 22.4 percent gross margin for the quarter. We also improved our cash position by about $10 million during the quarter and our overall balance sheet remains strong. Looking ahead, we do expect to experience some pricing pressure in the second quarter, which has traditionally been our slowest quarter of the year, in anticipation of next-generation products to be introduced in the third quarter."
Diamond Multimedia Systems, Inc.
Diamond Multimedia is driving the interactive multimedia market by providing advanced solutions for home, business and professional desktop computer users, enabling them to create, access and experience compelling new media content from their desktops and through the Internet. Diamond accelerates multimedia from the Internet to the hard drive with products that include the Stealth and Viper(R) series of media accelerators, the Monster series of entertainment 3D and sound accelerators, the Fire series of professional 3D and SCSI accelerators, and the Supra(R) series of modems. Diamond also markets DVD and video phone kits. Diamond's common stock is traded on the Nasdaq Stock Market under the symbol DIMD, and its web site address is www.diamondmm.com.
The above statements constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are subject to a number of risks and uncertainties, which could cause actual results to differ materially from those, projected. Among the factors that could cause actual results to differ materially are the following: business conditions and growth in the graphics and multimedia accelerator market, the modem market and the general economy, the volume and timing of orders received during the period, the timing of new product introductions by the Company and its competitors, product line maturation, competitive factors, such as rival chipset designs and pricing pressures, the availability of third-party components products at reasonable prices, inventory risks due to shifts in market demand and/or price erosion of purchased components, changes in product mix, distribution channels and costs associated with the development, manufacture and market introduction of new products.
Additional risks are detailed in the Company's filings with the Securities and Exchange Commission, including its reports on Form 10-K filed on March 24, 1998. The Company may, from time to time, make additional written and oral forward-looking statements, including statements contained in the Company's filings with the Securities and Exchange Commission and its reports to shareholders. The Company does not undertake to update any forward-looking statement that may be made from time to time by or on behalf of the Company. Readers should carefully review the risk factors described in the documents the Company files from time to time with the Securities and Exchange Commission.
Note to Editors: Monster 3D and Supra are either trademarks or registered trademarks of Diamond Multimedia Systems, Inc. Monster is a registered trademark of Monster Cable. Viper is a registered trademark of Directed Electronics, Inc., used under license. All other trademarks referenced are the service mark, trademark or registered trademark of their respective manufacturers.
For additional information on Diamond Multimedia call: Investor Relations: 408/325-7476; 1-888-474-3463 (U.S. and Canada); 24-Hour Fax-On-Demand Service: 1-800-380-0030; 1-800-PRO-INFO, ticker: DIMD
DIAMOND MULTIMEDIA
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(unaudited)
Three Months Ended
March 31,
1998 1997
Net sales $186,196 $112,402
Cost of sales 144,570 92,817
Gross profit 41,626 19,585
Research and development 7,092 5,692
Selling, general and administrative 23,158 22,511
Amortization of intangibles 244 1,316
Total operating expenses 30,494 29,519
Income (loss) from operations 11,132 (9,934)
Interest income, net 336 543
Other expense, net (144) (55)
Income (loss) before provision (benefit)
for income taxes 11,324 (9,446)
Provision (benefit) for income taxes 3,397 (3,495)
Net income (loss) $7,927 ($5,951)
Shares used in per share calculation:
Basic 34,781 34,179
Diluted 36,521 34,179
Net income (loss) per share:
Basic $0.23 ($0.17)
Diluted $0.22 ($0.17)
DIAMOND MULTIMEDIA
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands)
(unaudited)
At March 31, At Dec. 31,
1998 1997
ASSETS
Current assets:
Cash and short-term investments $100,929 $90,065
Accounts receivable 102,856 98,777
Inventories 92,456 78,647
Prepaid expenses and other current assets 6,958 6,350
Income taxes receivable 5,915 24,929
Deferred taxes 13,731 14,679
Total current assets 322,845 313,447
Fixed assets, net 18,470 15,216
Other assets 3,416 3,616
Goodwill and other intangibles, net 5,031 5,275
Total assets $349,762 $337,554
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term debt $35,301 $36,455
Trade accounts payable and other accrued
liabilities 116,354 116,431
Income taxes payable 5,518 2,274
Total current liabilities 157,173 155,160
Long-term debt, net of current portion 1,747 1,873
Total liabilities 158,920 157,033
Stockholders' equity 190,842 180,521
Total liabilities and stockholders'
equity $349,762 $337,554
CONTACT: Diamond Multimedia
James M. Walker, 408/325-7333 (Sr. VP/CFO)
Ken Wirt, 408/325-7376 (VP Corporate Marketing)
or
FRB San Francisco
Lise Needham (general information)
Jordan Goldstein (analyst contact)
415/986-1591
"Copyright(c) 1998, Business Wire"
"Provided by Dow Jones & Company, Inc." |
