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Technology Stocks : Mylex -- Ignore unavailable to you. Want to Upgrade?

To: Dougerdad who wrote (1691)	10/22/1998 7:35:00 PM
From: miklosh	Read Replies (1) \| Respond to of 1820

Mylex Posts Third Quarter 1998 Profit Before Restructuring Charge Revenue Up Over Prior Year and Prior Quarter FREMONT, Calif.--(BUSINESS WIRE)--Oct. 22, 1998--Mylex Corporation (Nasdaq:MYLX - news) today announced results for the third quarter and nine months ended Sept. 26, 1998. Third quarter sales were $36.2 million, up 23% from $29.4 million reported in the third quarter of 1997 and up 13%, sequentially from the $32.1 million reported for the second quarter of 1998. Excluding the $4.3 million non-recurring charges announced in July 1998, the company would have reported a net profit of $0.6 million, or $0.03 a share, for the third quarter. This compares with a net loss of $1.1 million, or ($0.05) per share, for the same quarter in the prior year and a loss of $2.1 million, or ($0.10) a share, for the immediately preceding quarter of 1998. Including the charge, the company reported a net loss for the third quarter of $2.1 million, or ($0.11) per share. The financial impact of all restructuring actions was recorded in the third quarter of 1998 and resulted in non-recurring charges of $4.3 million. The $3.1 million restructuring charge to operating expenses includes the cost of severance compensation, facilities consolidation, and the write-off of assets utilized in affected operations. The remaining charge of $1.2 million was for the write-off of associated Network Power & Light(TM) inventory and is included in cost of sales. The year-over-year improvement in sales is primarily attributable to the growth in sales to existing OEM customers, as well as increased acceptance, and resulting sales, of Mylex's new RAID controller product portfolio. While the return to profitability in the third quarter of 1998 was partially due to this sales growth and an improvement in gross margins, the substantial reduction in operating expenses resulting from the previously announced restructuring also contributed significantly to the company's profitable quarter. Specifically, Mylex terminated its Network Power & Light development activities and streamlined its organizational infrastructure. These actions produced an over $2 million reduction in operating expense reductions for the third quarter as compared with the second quarter of 1998, before the one-time charge to cover restructuring costs. ''I am pleased to report that Mylex returned to profitability in the third quarter,'' said Al Montross, president and CEO. ''We believe this quarter's results mark an important first step towards improved financial performance for Mylex and sends a strong message to our stockholders and customers.'' Montross continued, ''We experienced strong sales growth in Europe, the Pacific Rim, and through domestic distribution channels. We are also encouraged by customer acceptance of our newer product lines.'' ''During the quarter, Mylex successfully delivered two new products to market, each focusing on unique business segments. The products: AcceleRAID 250, an aggressively priced entry-level RAID adapter for servers and workstations; and eXtremeRAID, a RAID controller that significantly eliminates I/O bottlenecks in mid-range and enterprise-class storage systems.'' Colleen Gray, Mylex's VP Finance and CFO, stated, ''We ended the third quarter with over $40 million in cash and cash equivalents and short-term investments after repurchasing $0.8 million of Mylex's stock and satisfying approximately $1.0 million of restructuring obligations. The increase in third quarter sales, combined with improvements in inventory turns, has contributed to maintaining our strong cash position.'' In the third quarter, the company repurchased a total of 135,000 shares of common stock at a cost of $0.8 million. To date, the company has repurchased a total of 1.4 million shares at a cost of $12 million. Sales for the nine months were $96.6 million, compared with $92.3 million for the same period last year. The net loss for the nine months was $6.1 million, or ($0.31) per share, in comparison to a net loss of $5.3 million, or ($0.26) per share, for the same nine months of 1997. This looks good so far: Sales up 23% from q3 97! Expenses, costs down. Looking forward to brighter days ahead.