3Com Reports Record Sales for Second Fiscal Quarter.SANTA CLARA Santa Clara, city, Cuba Santa Clara (sän`tä klä`rä), city (1994 est. pop. 217,000), capital of Villa Clara prov., central Cuba. , Calif.--(BUSINESS WIRE)--Dec. 21, 1995--Global data networking leader 3Com Corporation today announced record sales for the second fiscal quarter of 1996, ended November November: see month. 30. Sales of $563.5 million increased 13 percent sequentially and 50 percent from the second quarter of fiscal 1995. Net income of $16.3 million ($.09 per share) included a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta charge of $69.0 million associated with the acquisition of Chipcom Chipcom was an early pioneer in the Ethernet Hub industry. Their products allowed Local Networks to be aggregated in a single place instead of being distributed across the length of a single coaxial cable. Corporation, a leading supplier of multi-function networking platforms. Excluding non-recurring charges in both years, 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 in the second quarter of fiscal 1996 was a record $65.6 million ($.37 per share), an increase of 43 percent from the $45.9 million ($.27 per share) posted in the comparable year-ago quarter. Historical financial results have been restated to reflect the acquisition of Chipcom, which was completed in October October: see month. 1995 in a pooling-of-interests transaction. Revenue growth was driven by strong sales of network adapters A printed circuit board that plugs into the bus of both user machines (clients) and servers in a local area network (LAN). Also commonly called a "network interface card" (NIC) or "LAN card," the network adapter transmits data onto the network and receives data from the network. , switching platforms, stackable hubs A type of Ethernet hub that can be expanded by daisy chaining additional hubs together via dedicated ports for that purpose. They are designed to stack vertically and be treated as a single domain by the network management software. and network access products. Sales of network adapters, which increased 22 percent sequentially and 37 percent from a year ago, accounted for 40 percent of total sales. Systems products, including hubs, LAN (Local Area Network) A communications network that serves users within a confined geographical area. The "clients" are the user's workstations typically running Windows, although Mac and Linux clients are also used. and ATM switches, internetworking internetworking - The interconnection of two or more networks, usually local area networks so that data can pass between hosts on the different networks as though they were one network. This requires some kind of router or gateway. products and network access platforms, were up 60 percent from the prior year and were 56 percent of total sales. "3Com continues to strengthen its position as the second largest data networking equipment vendor," said Eric ERIC Educational Research Information Clearinghouse ERIC Educational Resources Information Center ERIC ERISA Industry Committee ERIC Epidemiologic Research and Information Center (Durham, NC) Benhamou, chairman and chief executive officer, "With the acquisition and integration of Chipcom, 3Com offers carriers and enterprise customers the industry's most complete set of focused- and multi-function networking solutions. Additionally, we are well positioned to become the supplier of choice for Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the and on-line service providers with the Aperture An orifice. It often refers to an opening in which light is allowed to pass in optical systems such as cameras and lasers. See f-stop and numerical aperture. network access platform and 3Com Impact ISDN ISDN in full Integrated Services Digital Network Digital telecommunications network that operates over standard copper telephone wires or other media. digital modems." For the six-month period ending November 30, sales were $1.1 billion as compared with $691.5 million last year. Exclusive of non-recurring items in both periods, net income for the current fiscal six-month period was $123.0 million ($.70 per share), an increase of 50 percent from the $81.8 million ($.49 per share) posted in fiscal 1995. 3Com Corporation has helped more than 25 million people gain access to critical information through high-speed high-speed adj. 1. Operated or designed for operation at high speed: a high-speed food processor. 2. Taking place at high speed: a high-speed chase. 3. networks. Designed to serve large enterprises, service providers, small offices and homes, 3Com products provide a scalable architecture to meet the present and future connectivity needs of today's users. With research and development on three continents, 3Com is one of the data networking industry's largest and fastest growing companies and is the industry's largest LAN vendor. 3Com's innovative manufacturing, marketing, sales and support simplify communication, optimize optimize - optimisation network reliability and protect customer investments. For further information visit 3Com's Worldwide Web site: http://www.3Com.com -0-
3Com Corporation
Consolidated Statements of Income
(Unaudited. In thousands, except per share data.)
Quarter Ended Six Months Ended
Nov. 30, Nov. 30, Nov. 30, Nov. 30,
1995 1994 1995 1994
Sales $563,544 $376,771 $1,060,833 $691,454
Costs and Expenses:
Cost of sales 266,719 175,046 502,269 321,766
Sales and marketing 118,920 74,356 221,131 139,923
Research and development 56,082 39,091 107,630 73,240
General and
administrative 22,902 16,484 43,843 30,108
Purchased in-process
technology - 60,796 - 60,796
Acquisition related
charges & other 69,000 (1,100) 69,000 4,025
-------- -------- -------- -------
Total 533,623 364,673 943,873 629,858
Operating income 29,921 12,098 116,960 61,596
Other income - net 1,930 2,210 3,183 3,368
-------- -------- -------- -------
Income before taxes 31,851 14,308 120,143 64,964
Income tax provision 15,506 5,051 46,377 23,062
Net income $ 16,345 $ 9,257 $ 73,766 $ 41,902 Earnings per share: Primary $ 0.09 $ 0.06 $ 0.42 $ 0.25 Fully-diluted $ 0.09 $ 0.05 $ 0.42 $ 0.25 Shares used in computing per share amount: Primary 176,319 168,133 175,077 166,794 Fully-diluted 176,396 168,713 175,459 168,236
Earnings per share are adjusted for the two-for-one stock split
effective August 25, 1995.
Net income for the quarter and six months ended November 30, 1995
included a charge of approximately $69.0 million for merger costs
associated with the acquisition of Chipcom. Excluding this
non-recurring item, pro forma net income for the quarter ended
November 30, 1995 was $65.6 million ($0.37 per share) and pro forma
net income for the six months ended November 30, 1995 was
$123.0 million ($0.70 per share). Net income for the quarter ended
November 30, 1994 included a charge of approximately $60.8 million for
purchased in-process technology primarily associated with 3Com's
acquisition of NiceCom, and a credit of $1.1 million for the
reduction in accrued restructuring costs. Excluding these
non-recurring items, pro forma net income was $45.9 million ($0.27
per share). Net income for the six months ended Nov. 30, 1994
included the $60.8 million charge for purchased in-process
technology, the credit of $1.1 million for the reduction in accrued
restructuring costs, and a charge of approximately $5.1 million for
merger costs associated with Chipcom's acquisition of Artel
Communications Corporation. Excluding these non-recurring items, pro
forma net income was $81.8 million ($0.49 per share).
3Com Corporation
Consolidated Balance Sheets
(Unaudited. In thousands)
Nov. 30, 1995 May 31, 1995
ASSETS
Current Assets:
Cash, cash equivalents and
temporary investments $ 380,585 $ 385,568
Trade receivables 331,423 245,258
Inventories 194,373 182,759
Other 91,885 81,971
Total current assets 998,266 895,556
Property and equipment - net 195,501 144,944
Other assets 77,233 34,310
---------- -----------
Total $1,271,000 $1,074,810
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 119,955 $ 118,377
Accrued and other
liabilities 188,644 149,079
Income taxes payable 38,046 56,412
Current portion of
long-term obligations 586 997
----------- -----------
Total current liabilities 347,231 324,865
Long-term debt 110,000 110,000 Other long-term obligations 5,317 6,221 Deferred income taxes 19,587 -
Shareholders' Equity:
Common stock 492,424 435,922
Unamortized restricted
stock grants (3,641) (2,037)
Retained earnings 276,193 200,030
Unrealized gain (loss) on
available-for-sale securities 24,366 (22)
Accumulated translation
adjustments (477) (169)
---------- -----------
Total shareholders' equity 788,865 633,724
---------- -----------
Total $1,271,000 $1,074,810
Note to editors/analysts: To provide some visibility into
calendar-year results, the following schedules are statements of
operations for 3Com Corporation for the 12-month period ending
November 30, 1995 and November 30, 1994.
3Com Corporation
Consolidated Statements of Operations
(Unaudited. In thousands, except per share data.)
Twelve Months Ended
Nov. 30, 1995 Nov. 30, 1994
Sales $1,962,848 $1,254,684
Costs and Expenses:
Cost of sales 918,596 588,882
Sales and marketing 400,518 258,869
Research and development 200,717 129,053
General and administrative 80,197 55,526
Purchased in-process
technology 7,900 195,277
Acquisition related charges
& other 75,100 4,025
---------- ----------
Total 1,683,028 1,231,632
Operating income 279,820 23,052
Other income - net 4,710 5,518
Income before taxes 284,530 28,570
Income tax provision 108,107 52,667
---------- ----------
Net income (loss) $ 176,423 $ (24,097)
Net income (loss) per share: Primary $ 1.02 $ (0.15) Fully-diluted $ 1.02 $ (0.15) Shares used in computing per share amount: Primary 173,389 160,411 Fully-diluted 173,786 160,909 Note: Earnings per share are adjusted for the two-for-one stock split effective August 25, 1995. Net income for the twelve months ended November 30, 1995 included a charge of approximately $7.9 million for purchased in-process technology associated with Chipcom's acquisition of DSI (Dynamic Systems Initiative) An umbrella term for a suite of Microsoft products that help manage the Windows environment in large enterprises. DSI was introduced in 2003. ExpressNetworks, Inc. and a $75.1 million charge for merger costs associated with 3Com's acquisitions of Chipcom, Sonix Communications Ltd., and Primary Access Corporation. Excluding these non-recurring items, pro forma net income was $236.7 million ($1.36 per share). Net loss for the twelve months ended November 30, 1994 included a charge of approximately $195.3 million for purchased in-process technology primarily associated with 3Com's acquisitions of Synernetics, Inc., 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, Inc. and NiceCom, a $5.1 million charge for merger costs associated with Chipcom's acquisition of Artel Artel (Russian: арте́ль) is a general term for various cooperative associations in Russia, historical and modern. and a credit of $1.1 million for the reduction in accrued ac·crue v. ac·crued, ac·cru·ing, ac·crues v.intr. 1. To come to one as a gain, addition, or increment: interest accruing in my savings account. 2. restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). costs. Excluding these non-recurring items, pro forma net income was $144.1 million ($0.88 per share). CONTACT: 3Com Corporation Kate n. 1. (Zool.) The brambling finch. Patterson Patterson, family of American journalists. Robert Wilson Patterson, 1850–1910, b. Chicago, grad. Williams, 1871, became (1871) a reporter on the Chicago Times and after 1873 was attached to the Chicago Tribune. , 408/764-6802 (Investor Relations Investor relations The process by which the corporation communicates with its investors. ) David J David J. Haskins (b. April 24, 1957, in Northampton, England) is a British alternative rock musician. He was the bassist for the seminal gothic rock band Bauhaus. Life and work . Abramson Abramson and Abrahamson are variations of the same patronymic surnames, meaning "son of Abram", the Biblical figure. The names are most prevalent among Jews. Abramson
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