3Com Corporation Announces Record Third Quarter Sales and Earnings; Sales of New Products Drive Revenue Growth.SANTA CLARA, Calif.--(BUSINESS WIRE)--March 14, 1995--3Com Corporation, a leading global data networking company, today announced record sales of $338.7 million for the third quarter ended February 28, an increase of 55 percent from the year-ago quarter. Net income of $45.3 million ($.63 per share) increased 82 percent as compared with pro forma As a matter of form or for the sake of form. Used to describe accounting, financial, and other statements or conclusions based upon assumed or anticipated facts. The phrase pro forma net income of $24.9 million ($.36 per share) in the third fiscal quarter of 1994. Reported results for the year-ago quarter showing a net loss of $103.5 million ($1.64 per share) reflect pre-tax charges of $134.5 million related to the purchase of in-process technologies associated with the acquisitions of Synernetics, Inc. and Centrum centrum /cen·trum/ (sen´trum) pl. cen´tra [L.] 1. a center. 2. the body of a vertebra. cen·trum n. pl. cen·trums or cen·tra 1. Communications and the licensing of Ethernet wireless technology from Pacific Monolithics. "This quarter's results reflect the tangible benefits of our acquisitions, especially in switching, as well as the success of new products from our adapter, hub and internetworking divisions," said Eric Benhamou, chairman and chief executive officer. "Through a well-defined product development program and the successful integration of acquired technologies, 3Com now offers customers the most complete set of scalable data networking solutions available for workgroup, remote office, personal office, campus backbone and wide-area backbone applications." According to recently published market research, 3Com is the worldwide market leader in Ethernet adapters, stackable hubs and backbone LAN switches. During the quarter, the company enhanced its position in these markets with the introduction of several new platforms under its High Performance Scalable Networking (HPSN HPSN Hot-Pressed Silicon Nitride HPSN High Performance Scalable Networking ) architecture, the industry's only desktop-to-WAN enterprise-wide blueprint for designing and building global data networks. New products which began shipping during the quarter included an ATM backbone switch, the Cellplex 7000, and two new LAN switching platforms based on 3Com's ISE Ise (ē`sā), city (1990 pop. 104,164), Mie prefecture, S Honshu, Japan, on Ise Bay. It is one of the foremost religious centers of Shinto, the site of the shrines of Ise. (Intelligent Switching Engine) ASIC (Application Specific Integrated Circuit) Pronounced "a-sick." A chip that is custom designed for a specific application rather than a general-purpose chip such as a microprocessor. . The company also took steps to further diversify its adapter sales with the introductions of 10 Mbps and Fast Ethernet (100 Mbps) adapters for high-performance PCI (1) (Payment Card Industry) See PCI DSS. (2) (Peripheral Component Interconnect) The most widely used I/O bus (peripheral bus). personal computers and the acquisition of ISDN ISDN in full Integrated Services Digital Network Digital telecommunications network that operates over standard copper telephone wires or other media. development partner, AccessWorks Communications. Sales of the company's systems products, which include internetworking platforms, hubs, switches and remote access servers, grew 65 percent from the year-ago quarter and accounted for 41 percent of total sales. Sales of network adapters, including the industry-leading EtherLink III family of desktop and PC Card adapters, were 55 percent of total sales and increased 54 percent year-over-year. By geographic region, sales to the Americas accounted for 47 percent of total sales, up 51 percent compared with a year ago, while sales to the combined European and Asia/Pacific markets increased 59 percent to account for 53 percent of total sales. For the current nine months, sales were $892.8 million as compared with $585.5 million last year. Exclusive of non-recurring items in both periods, net income for the current fiscal nine-month period was $113.1 million ($1.58 per share), an increase of 89 percent over the $59.7 million ($.87 per share) posted in fiscal 1994. Founded in 1979, 3Com Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : COMS COMS 3Com Corporation (stock symbol) COMS Certified Orientation and Mobility Specialist COMS Continuous Opacity Monitoring Systems COMS City of Manchester Stadium (UK) ) pioneered the data networking industry. Today, 3Com offers customers a broad range of ISO (1) See ISO speed. (2) (International Organization for Standardization, Geneva, Switzerland, www.iso.ch) An organization that sets international standards, founded in 1946. The U.S. member body is ANSI. 9000-compliant global data networking solutions that include routers, hubs, switches and adapters for Ethernet, Token Ring, and high-speed networks. Headquartered in Santa Clara, Calif., 3Com is a Fortune 500 company with worldwide research and development, manufacturing, marketing, sales and support capabilities. -0-
3Com Corporation
Consolidated Statements of Income
(In thousands, except per share data)
(unaudited)
Quarter Ended Nine Months Ended
Feb. 28, Feb. 28, Feb. 28, Feb. 28,
1995 1994 1995 1994
Sales $338,676 $218,166 $892,764 $585,532 Costs and Expenses: Cost of sales 155,627 104,983 415,427 289,069 Sales and marketing 64,901 44,002 174,809 121,958 Research and development 33,132 19,369 88,779 53,410 General and administrative 12,554 8,534 32,314 25,427 Purchased in-process technology - 134,481 60,796 134,481 Non-recurring item - - (1,100) - Total 266,214 311,369 771,025 624,345 Operating income (loss) 72,462 (93,203) 121,739 (38,813) Other expense - net (1,684) (412) (2,359) (1,224) Gain of sale on investment - - - 17,746 Income (loss) before income taxes 70,778 (93,615) 119,380 (22,291) Income tax provision 25,480 9,845 42,977 33,592 Net income (loss) $45,298 ($103,460) $76,403 ($55,883) Earnings (loss) per share: Primary $0.63 ($1.64) $1.08 ($0.90) Fully-diluted $0.63 ($1.64) $1.06 ($0.90) Shares used in computing per share amount: Primary 72,073 63,088 70,981 61,924 Fully-diluted 72,288 63,088 71,758 61,924 -0- Earnings per share are adjusted for the two-for-one stock split effective Sept. 1, 1994. Net income for the quarter ended Feb. 28, 1994 included a charge of approximately $134.5 million for purchased in-process technology primarily associated with the acquisitions of Synernetics Inc. and Centrum Communications. Excluding these non-recurring items, pro forma net income was $24.9 million (36 cents per share). Net income for the nine months ended Feb. 28, 1995 included a charge of approximately $60.8 million for purchased in-process technology primarily associated with the acquisition of NiceCom Ltd. and a credit of $1.1 million for the reduction in accrued restructuring costs. Excluding these non-recurring items, pro forma net income was $113.1 million ($1.58 per share). Net income for the nine months ended Feb. 28, 1994, included a charge of approximately $134.5 million for purchased in-process technology, a gain of $17.7 million on the sale of an investment and a $1.2 million tax benefit from retroactive tax law changes. Excluding these non-recurring items, pro forma net income was $59.7 million (87 cents per share). -0- 3Com Corporation Consolidated Balance Sheet consolidated balance sheet A balance sheet in which assets and liabilities of a parent company and its controlled subsidiaries are combined, thereby presenting balance sheet items for the parent and its subsidiaries as if they were a single firm. (In thousands) Feb. 28, 1995 May 31, 1994 (unaudited) ASSETS Current Assets Current Assets Appearing on a company's balance sheet, it represents cash, accounts receivable, inventory, marketable securities, prepaid expenses, and other assets that can be converted to cash within one year. : Cash, cash equivalents and temporary cash investments $263,479 $129,697 Trade receivables 187,628 118,653 Inventories 89,562 71,352 Other 49,164 41,370 Total current assets 589,833 361,072 Property and equipment - net 91,127 67,001 Other assets other assets Assets of relatively small value. For financial reporting purposes, firms frequently combine small assets into a single category rather than listing each item separately. 33,291 16,270 Total $714,251 $444,343 LIABILITIES AND SHAREHOLDERS' EQUITY Shareholders' Equity A firms' total assets minus its total liabilities. Equivalently, it is share capital plus retained earnings minus treasury shares. Shareholders' equity is the amount by which a company is financed through common and preferred shares. Current Liabilities Current Liabilities Usually appearing on a company's balance sheet, it represents the amount owed for interest, accounts payable, short-term loans, expenses incurred but unpaid, and other debts due within one year. : Accounts payable and accruals $81,068 $51,827 Accrued and other liabilities other liabilities Small and relatively insignificant liabilities. For financial reporting purposes, firms often combine small liabilities into this single category rather than listing each liability separately. 100,085 91,130 Income taxes payable 39,936 19,090 Current long-term obligations 219 482 Total current liabilities 221,308 162,529 Long-term debt Long-Term Debt Loans and financial obligations lasting over one year. Notes: For example debts obligations such as bonds and notes which have maturities greater than one year would be considered long-term debt. 110,000 -- Other long-term obligations 870 1,058 Stockholders' Equity Stockholders' Equity The portion of the balance sheet that includes capital received from investors in exchange for stock (paid-in capital), donated capital, and retained earnings. This is equal to total assets minus liabilities, preferred stock and intangible assets. : Common stock 263,728 219,937 Unamortized restricted stock grants (2,205) (202) Accumulated translation adjustments (263) (305) Retained earnings Retained Earnings The percentage of net earnings not paid out in dividends, but retained by the company to be reinvested in its core business or to pay debt. It is recorded under shareholders equity on the balance sheet. 120,813 61,326 Total shareholders' equity 382,073 280,756 Total $714,251 $444,343 CONTACT: 3Com Investor Relations Investor relations The process by which the corporation communicates with its investors. Kate Patterson, 408/764-6802 Cunningham Communication, Inc. Geoffrey Kerr, 408/764-0746 |
|
||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion