Headline: Apple Reports Third Quarter Profit of $101 Million
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CUPERTINO, Calif., July 15 /PRNewswire/ -- Apple Computer, Inc.
(NASDAQ:AAPL) today announced a profit of $101 million, or $.65 per diluted
share, for the Company's fiscal 1998 third quarter ended June 26, 1998. These
results compare to a profit of $55 million, or $.38 per diluted share,
achieved in the March 1998 quarter. Revenues for the quarter were
$1.4 billion, equal to revenues of the prior quarter, and gross margins were
25.7 percent, up from 24.8 percent in the prior quarter. International sales
accounted for 43 percent of the quarter's revenues.
The current quarter's results included a $26 million net favorable impact
from non-recurring items, including an after-tax gain of $33 million related
to the initial public offering of ARM Holdings plc., in which the Company is a
shareholder, and a $7 million charge for purchased in-process research and
development related to the acquisition of technology from Macromedia, Inc.
Without these non-recurring items, the Company's net income for the quarter
would have been $75 million, or $.50 per diluted share.
"Apple had a terrific quarter -- we sold a record number of Power
Macintosh G3 computers, customers love our new PowerBooks, Apple earned its
highest profits in years, and we ended the quarter with the lowest inventory
level among the major PC players," said Apple's interim CEO Steve Jobs.
"Looking forward, Apple's improved operational efficiency has paved the way
for us to aggressively reenter the consumer market with iMac on August 15."
"Apple's three consecutive quarters of profitability and improved asset
management have made Apple much stronger financially," said Apple's CFO Fred
Anderson. "We have nearly $2 billion in cash and short-term investments, and
we believe we have the infrastructure in place to support our upcoming reentry
into the consumer market."
Except for the historical information contained herein, the statements in
this press release are forward-looking statements that involve risks and
uncertainties. Potential risks and uncertainties include, without limitation,
continued competitive pressures in the marketplace; the effect competitive
factors and the Company's reaction to them may have on consumer and business
buying decisions with respect to the Company's products; the ability of the
Company to make timely delivery of new products and successful technological
innovations to the marketplace; and the ability of the company to successfully
evolve its operating system. More information on potential factors that could
affect the Company's financial results is included in the Company's public
reports filed with the SEC, including the Company's Form 10-K for the 1997
fiscal year, the Company's Form 10-Q for the first and second fiscal quarters,
and the Company's Form 10-Q for the third fiscal quarter, to be filed with the
SEC.
Apple Computer, Inc. ignited the personal computer revolution in the 1970s
with the Apple II, and reinvented the personal computer in the 1980s with the
Macintosh. Apple is now recommitted to its original mission -- to bring the
best personal computing products and support to students, educators,
designers, scientists, engineers, businesspersons and consumers in over
140 countries around the world.
NOTE: Apple, the Apple logo, and Macintosh are registered trademarks of
Apple Computer, Inc. Additional company and product names may be trademarks or
registered trademarks of the individual companies and are respectfully
acknowledged.
APPLE COMPUTER, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollars in millions, except per share amounts)
THREE MONTHS ENDED NINE MONTHS ENDED
June 26, June 27, June 26, June 27,
1998 1997 1998 1997
Net sales $1,402 $1,737 $4,385 $5,467
Costs and expenses:
Cost of sales 1,042 1,389 3,323 4,419
Research and development 76 101 230 391
Selling, general
and administrative 216 307 673 1,027
In-process research
and development 7 -- 7 375
Restructuring costs -- -- -- 155
1,341 1,797 4,233 6,367
Operating income (loss) 61 (60) 152 (900)
Interest and other income
(expense), net 48 4 63 16
Income (loss) before provision
(benefit) for income taxes 109 (56) 215 (884)
Provision for income taxes 8 -- 12 --
Net income (loss) $101 $(56) $203 $ (884)
Earnings (loss) per common share:
Basic $0.76 $(0.44) $1.55 $(7.04)
Diluted $0.65 $(0.44) $1.40 $(7.04)
Shares used in computing
earnings (loss) per
common share (in thousands):
Basic 133,068 126,500 130,971 125,547
Diluted 171,786 126,500 145,177 125,547
APPLE COMPUTER, INC.
CONSOLIDATED BALANCE SHEETS
ASSETS (In millions)
June 26, September 26,
1998 1997
(Unaudited)
Current assets:
Cash and cash equivalents $1,203 $1,230
Short-term investments 790 229
Accounts receivable, net of
allowance for doubtful
accounts of $90
($99 at September 26, 1997) 915 1,035
Inventories:
Purchased parts 54 141
Work in process 8 15
Finished goods 67 281
129 437
Deferred tax assets 192 259
Other current assets 146 234
Total current assets 3,375 3,424
Property, plant, and equipment:
Land and buildings 352 453
Machinery and equipment 379 460
Office furniture and equipment 93 110
Leasehold improvements 134 172
958 1,195
Accumulated depreciation
and amortization (593) (709)
Net property, plant, and equipment 365 486
Other assets 301 323
$4,041 $ 4,233
APPLE COMPUTER, INC.
CONSOLIDATED BALANCE SHEETS (Continued)
LIABILITIES AND SHAREHOLDERS' EQUITY
(Dollars in millions)
June 26, September 26,
1998 1997
(Unaudited)
Current liabilities:
Notes payable to banks $-- $25
Accounts payable 573 685
Accrued compensation and employee benefits 91 99
Accrued marketing and distribution 234 278
Accrued warranty and related 124 128
Accrued restructuring costs 77 180
Other current liabilities 290 423
Total current liabilities 1,389 1,818
Long-term debt 953 951
Deferred tax liabilities 213 264
Shareholders' equity:
Series A non-voting convertible
preferred stock, no par value;
150,000 shares authorized,
issued and outstanding 150 150
Common stock, no par value;
320,000,000 shares authorized;
133,130,984 shares issued
and outstanding at June 26, 1998
(127,949,220 shares at
September 26, 1997) 592 498
Retained earnings 792 589
Other (48) (37)
Total shareholders' equity 1,486 1,200
$4,041 $4,233
SOURCE Apple Computer
-0- 07/15/98
/NOTE TO EDITORS: For additional information visit Apple's website
(www.apple.com/pr/), call Apple's Media Helpline at 408-974-2042, or contact
Cara Lewis at Apple's PR agency, Niehaus Ryan Wong, Inc. 650-827-7052./
/CONTACT: media, Tami Begasse, 408-974-3156, or begasse@apple.com; or
investors, Nancy Paxton, 408-974-5420, or paxton1@apple.com, both of Apple
Computer, Inc./
/Web site: apple.com |
