Computer Network Technology Reports Record 1998 Revenue of $133.5
Million, Up 36 Percent
Full-Year EPS Increase of 700 Percent over 1997 (Excluding Non-Recurring Charges), Highest in Four Years
biz.yahoo.com
MINNEAPOLIS, Jan. 27 /PRNewswire/ -- Computer Network Technology Corp. (CNT®) (Nasdaq: CMNT - news), today reported record company revenues for 1998 fourth quarter and year-end. Strong demand for its SAN applications, EAI solutions, and Professional Services, together with improved operating expense efficiencies, has resulted in an increase of 700 percent over 1997 in the 1998 Earnings Per Share.
Record revenue of $35.9 million for the fourth quarter ended December 31, 1998, represents an increase of $4.3 million or 14 percent when compared to revenue of $31.6 million for the same period in 1997. Pro forma net income before non-recurring charges for the 1998 fourth quarter was $2.6 million or $.11 per share, compared to a pro forma net income before non-recurring charges of $718,000 or $.03 per share in the 1997 fourth quarter. Annual and fourth quarter results for 1998
include a non-recurring charge of $927,000 for in-process research and development associated with the acquisition of IntelliFrame Corporation in December 1998. After the charge, the Company reported net income of $1.7 million or $.07 per share for the 1998 fourth quarter.
For the year ended December 31, 1998, record revenues totaled $133.5 million compared to $97.8 million for 1997, an increase of 36 percent. Excluding non-recurring charges, pro forma net income for 1998 was approximately $5.7 million or $.25 per share, compared to $619,000 or $.03 per share for 1997. After the charge, the Companp reported net income of $4.7 million or $.21 per share for 1998.
''Thanks to record revenues and our focus on improved operating efficiencies, our 1998 Earnings Per Share increased 700 percent over 1997, the highest EPS since 1994,'' said Thomas G. Hudson, CNT's president and ch ex executive officer. ''Product revenue for the fourth quarter totaled $25.6 million, up 12 percent when compared to the 1997 fourth quarter. Total
product revenue for 1998 totaled $95.5 million, an increase of 39 percent over 1997.
''Revenue for networking products increased 11 percent to $19.3 million when compared to the fourth quarter of 1997,''
Hudson continued. ''Networking product revenue for 1998 increased 34 percent from 1997. The increase comes in part from
continued strong interest in networked disk mirroring and other SAN applications. In November, we re-affirmed our position
as the industry leader in wide area networking by providing a key piece of the critical capabilities for an Oracle8i/EMC
high-availability remote disk mirroring demonstration at Oracle's Open World conference.
''Internet product revenue totaled $6.3 million, a 16 percent increase from the fourth quarter of 1997 due to strong sales of our EAI products,'' Hudson added. ''For the year, revenue for Internet products totaled $20.5 million, an increase of 62 percent from 1997, primarily due to the acquisition of the Internet Solutions Division from Apertus Technologies, Inc. in the fourth quarter of 1997. Our acquisition of IntelliFrame in the fourth quarter will further strengthen our position in the growing Middleware market. IntelliFrame brings exciting new middleware technology to manage software development and deployment, along with process workflow, for customers with large e-commerce and customer relationship management applications.
''Service revenue in the fourth quarter increased 17% when compared to the 1997 fourth quarter, primarily due to new incremental revenue generated from the sale of professional services,'' said Hudson. ''Total service revenue for 1998 increased 31 percent from 1997. By providing CNT's knowledge and networking expertise through professional services, our customers can accelerate their product implementation plans, thereby improving their return on investment.
''For the second consecutive quarter, CNT exceeded its commitment to the Shareholders to achieve a 7.5 percent quarterly operating margin in the fourth quarter,'' Hudson continued. ''The 1998 fourth quarter operating margin was 10.4 percent, versus 3.3 percent in fourth quarter 1997. Although we have surpassed our goal for 1998, we will continue to focus on satisfying customers, growing revenue and containing expenses, thereby improving the company's level of full-year profitability
in 1999.
''As we work to improve the company's financial returns, we are also furthering our commitment to quality and strengthening our management team,'' added Hudson. ''In the fourth quarter, CNT hired a new Vice President of Quality and a new Vice President of Engineering Operations. As CNT grows, we must continue to ensure that our product and service quality exceed our customers' expectations.'' |
