ADIC Q4 Sales of $91 Million Bring Fiscal Year Total to $365 Million as Annual Growth Tops 25 Percent; Sequential Quarterly Sales Growth Resumes, Further Growth Anticipated.Business Editors REDMOND Redmond, city (1990 pop. 35,800), King co., W Wash., a suburb of Seattle, on Lake Sammamish; inc. 1912. Its economy centers around computer software (Microsoft Corp. , Wash.--(BUSINESS WIRE)--Dec. 12, 2001 ADVANCED DIGITAL INFORMATION CORPORATION (Nasdaq:ADIC) today announced sales for its fourth fiscal quarter ended Oct. 31 grew eight percent over the same quarter last year to $91.2 million, and grew nearly 26 percent to $364.7 million for the fiscal year. Despite economic concerns, sequential quarterly sales grew approximately seven percent from the immediately preceding quarter ended July July: see month. 31. Pro forma earnings pro forma earnings Income not necessarily calculated in accordance with generally accepted accounting principles. For example, a company might report pro forma earnings that exclude depreciation expense and nonrecurring expenses such as restructuring costs. , after adjustment for previously announced acquisition costs and other one-time items, were approximately $2.3 million, or four cents per fully diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share, for the quarter and $18.3 million, or 29 cents per fully diluted share, for the fiscal year. Inclusion of acquisition costs and other one-time items results in reported net losses for the quarter and year of $5.4 million and $10.8 million, respectively. The Company has met or exceeded both sales and income estimates first announced July 19 and confirmed on Nov. 13. In both cases, ADIC confirmed that strong growth relative to its storage networking peers and excellent opportunities for continued growth would lead it to maintain heavy investments in product development, sales and service channels as well as infrastructure improvements at the expense of optimizing short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. profits. "The last several months have brought a dramatic slowdown For articles with similar titles, see Slow Down (disambiguation). A slowdown is an industrial action in which employees perform their duties but seek to reduce productivity or efficiency in their performance of these duties. in the economy, the effects of which were compounded by the tragic events of September 11 and their aftermath," said Chairman and Chief Executive Officer Peter van Oppen. "Despite these concerns, we are very pleased to report annual growth, on both a quarterly and fiscal year basis, resumed sequential growth and profitability consistent with expectations that were established prior to the terrorist attacks." "Further," van Oppen said, "current first quarter sales are expected to range between $90 million and $95 million and are likely to show sequential sales growth over our traditionally strong fourth quarter." "We are delighted to report continued widespread acceptance of our Storage Networking Libraries," ADIC President and Chief Operating Officer Chief Operating Officer (COO) The officer of a firm responsible for day-to-day management, usually the president or an executive vice-president. Chuck Stonecipher said. "Major OEM (Original Equipment Manufacturer) The rebranding of equipment and selling it. The term initially referred to the company that made the products (the "original" manufacturer), but eventually became widely used to refer to the organization that buys the products and and branded customers are incorporating our architecture and roadmap including managed connectivity and SAN services." He said, "We believe that, as the economy improves, our Storage Networking Libraries and associated software will represent an outstanding growth opportunity." The Company noted that more than 40 percent of its 2002 revenues are expected to be associated with Storage Area Network (SAN) installations or SAN-ready storage solutions. OEM shipments for the fourth quarter and fiscal year 2001 totaled 43 percent and 42 percent of total sales, respectively, versus 33 percent and 27 percent for the previous fourth quarter and fiscal year. During 2001, sales to Dell Computer were $60.1 million and sales to IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) Corporation were $85.8 million. As previously announced, pro forma earnings numbers include several adjustments to audited results eliminating one-time costs that, in the judgment of management, are not reflective Refers to light hitting an opaque surface such as a printed page or mirror and bouncing back. See reflective media and reflective LCD. of the Company's ongoing performance. Such adjustments include the elimination of $29.9 million in combined patent litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. costs, fees and inventory adjustments associated with the acquisition of Pathlight Technology in May, more than half the net cost of which was offset by post-closing purchase price adjustments. Fourth quarter and annual 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 operating earnings Operating Earnings Profits after subtracting expenses such as marketing, cost of goods sold, administration and general operating costs from revenue. Notes: Tax and interest expenses are not subtracted - operating earnings are synonymous with EBIT (earnings before also exclude a previously announced $2.3 million liability recorded to reflect the effect of the deteriorating de·te·ri·o·rate v. de·te·ri·o·rat·ed, de·te·ri·o·rat·ing, de·te·ri·o·rates v.tr. To diminish or impair in quality, character, or value: economy on anticipated costs to exit a manufacturing and development site which has been replaced by a larger facility. Pro forma adjustments to other income total $10.7 million and include a previously announced $8.05 million reduction in carrying value Carrying Value Also know as "book value," it is a company's total assets minus intangible assets and liabilities, such as debt. Notes: This is different than market value, as it can be higher or lower depending on the circumstances. of investments in certain private technology companies. The remainder represents a non-cash loss of $2.64 million on covered derivative securities Derivative security A financial security such as an option or future whose value is derived in part from the value and characteristics of another security, the underlying asset. . This loss will be more than offset by cash gains that will be reflected as related derivative derivative: see calculus. derivative In mathematics, a fundamental concept of differential calculus representing the instantaneous rate of change of a function. contracts mature over the next two quarters. All pro forma results assume a 35 percent tax rate. The reported tax provision reflects tax benefits associated with one-time items excluded for pro forma purposes. Reported results for the fourth quarter and fiscal year 2000 have been restated to reflect the acquisition of Pathlight Technology on a pooling-of-interests basis. Also, prior fourth quarter and fiscal year results include one-time, pre-tax gains of $6.9 million and $97.3 million, respectively. About ADIC Advanced Digital Information Corporation (Nasdaq:ADIC) is a leading storage solutions provider to the open systems marketplace, offering a broad range of Intelligent Storage(TM) products designed to enhance organizations' abilities to store, protect, manage and use their rapidly growing network data. ADIC products include technology-independent automated au·to·mate v. au·to·mat·ed, au·to·mat·ing, au·to·mates v.tr. 1. To convert to automatic operation: automate a factory. 2. storage systems, specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. storage management software, and multiple-protocol storage networking (SAN/NAS) connectivity and management tools. ADIC storage products are available through a worldwide sales force and a global network of resellers and OEMs, including Dell, Fujitsu-Siemens and IBM. Further information about ADIC is available at www.adic.com. Conference Call There will be a conference call to discuss the fourth quarter fiscal 2001 earnings and fiscal 2002 outlook at 5:30 A.M. PT on Dec. 13, 2001. The call can be accessed live on our website at www.adic.com/ir. This release contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's future products and services and future operating results that are subject to risks and uncertainties that could cause actual results to differ materially from those projected. The words "expect", "anticipate", and similar expressions identify forward-looking statements, but their absence does not mean that the statement is not forward-looking. These statements are not guarantees of future performance and are subject to certain risks, uncertainties and assumptions that are difficult to predict. Factors that could affect the Company's actual results include general economic trends, purchase deferrals by customers, technical competition or obsolescence ob·so·les·cent adj. 1. Being in the process of passing out of use or usefulness; becoming obsolete. 2. Biology Gradually disappearing; imperfectly or only slightly developed. , supply constraints CONSTRAINTS - A language for solving constraints using value inference. ["CONSTRAINTS: A Language for Expressing Almost-Hierarchical Descriptions", G.J. Sussman et al, Artif Intell 14(1):1-39 (Aug 1980)]. , changes in market pricing and production problems. Reference is made to the Company's Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for the quarter ended April 30, 2001 for a more detailed description of factors that could affect the Company's actual results. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this release. The Company undertakes no obligation to update publicly any forward-looking statements to reflect new information, events or circumstances CIRCUMSTANCES, evidence. The particulars which accompany a fact. 2. The facts proved are either possible or impossible, ordinary and probable, or extraordinary and improbable, recent or ancient; they may have happened near us, or afar off; they are public or after the date of this release or to reflect the occurrence of unanticipated events. ADIC and Scalar scalar, quantity or number possessing only sign and magnitude, e.g., the real numbers (see number), in contrast to vectors and tensors; scalars obey the rules of elementary algebra. Many physical quantities have scalar values, e.g. are registered trademarks and Intelligent Storage is a trademark of Advanced Digital Information Corporation. All other trade or service marks mentioned in this release should be considered the property of their respective owners.
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except for per share amounts)
Three months ended Fiscal year ended
October 31, October 31,
2001 2000 2001 2000
--------- --------- --------- ---------
Net sales $ 91,171 $ 84,171 $364,681 $290,296
Cost of sales 66,331 51,989 258,893 183,717
Pathlight acquisition costs -- -- 4,109 --
--------- --------- --------- ---------
Gross profit 24,840 32,182 101,679 106,579
Selling and administrative
expenses 18,125 15,825 63,664 54,615
Research and development
expenses 7,607 5,527 27,763 19,959
Crossroads settlement costs -- 269 16,974 434
Pathlight acquisition costs -- -- 8,837 --
--------- --------- --------- ---------
Operating profit (loss) (892) 10,561 (15,559) 31,571
Other income (expense), net (8,632) 10,668 819 108,491
--------- --------- --------- ---------
Income (loss) before provision
for income taxes (9,524) 21,229 (14,740) 140,062
Provision (benefit) for income
taxes (4,118) 4,861 (3,908) 44,618
--------- --------- --------- ---------
Net income (loss) $ (5,406) $ 16,368 $(10,832) $ 95,444
========= ========= ========= =========
Basic net income (loss)
per share $ (0.09) $ 0.28 $ (0.18) $ 1.62
========= ========= ========= =========
Diluted net income (loss)
per share $ (0.09) $ 0.26 $ (0.18) $ 1.50
========= ========= ========= =========
Shares used in computing basic
net income (loss) per share 61,638 58,985 60,381 58,747
========= ========= ========= =========
Shares used in computing
diluted net income (loss)
per share 61,638 63,122 60,381 63,469
========= ========= ========= =========
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
October 31, October 31,
2001 2000
----------- -----------
ASSETS
Current assets:
Cash and cash equivalents $ 155,274 $ 194,268
Accounts receivable, net 82,451 70,092
Inventories, net 42,430 37,963
Marketable equity securities 23,352 19,349
Other current assets 21,632 11,829
----------- -----------
Total current assets 325,139 333,501
Property, plant and equipment, net 32,017 19,419
Service parts for maintenance, net 17,149 10,523
Investments 11,503 20,972
Other non-current assets 13,562 14,830
----------- -----------
$ 399,370 $ 399,245
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $ 67,724 $ 71,480
Long-term debt 1,170 1,279
Shareholders' equity 330,476 326,486
----------- -----------
$ 399,370 $ 399,245
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