AST reports fourth quarter results.IRVINE Irvine, town, Scotland Irvine (ûr`vĭn), town (1991 pop. 32,507), North Ayrshire, SW Scotland, on the Irvine River estuary. Industries include iron and brass foundries. Other products are chemicals, electric goods, and clothing. , Calif.--(BUSINESS WIRE)--Jan. 30, 1997--AST Research Inc. (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 :ASTA) on Thursday Thursday: see week. announced revenues of $611.4 million for the fourth quarter of fiscal year 1996, ended Dec. 28, 1996, compared with revenues of $612.9 million reported during the prior year period. Net loss was $68.0 million ($1.18 per share), compared with a net loss of $128.6 million ($2.88 per share) reported during the prior year period. Total revenues for fiscal year 1996 were $2.104 billion, vs. $2.348 billion for the previous calendar year. Net loss for fiscal year 1996 was 417.7 million ($8.22 per share) vs. 263.2 million ($7.01 per share) in calendar year 1995. In 1995 AST (AST Computer, Irvine, CA) A PC manufacturer founded in 1980 by Albert Wong, Safi Quershey and Tom Yuen (A, S and T). It offered a complete line of PCs that sold through its dealer channel. changed its fiscal year end from June June: see month. to December December: see month. . Therefore, fiscal year 1996 comparisons to the prior calendar year period include the third and fourth quarters of fiscal year 1995 and the first and second quarters of transition year 1995. In a separate announcement issued earlier today, the company also stated it has received a proposal from Samsung to commence negotiations with respect to the acquisition by Samsung Electronics Samsung Electronics (SEC, Hangul:삼성전자; KSE: 005930, KSE: 005935, LSE: SMSN, LSE: SMSD) is a South Korean multinational corporation and the world's largest and leading electronics and information technology company. of all of outstanding shares of common stock of AST not currently owned by Samsung Electronics or its affiliates, at a price of $5.10 per share. AST's achieved total worldwide shipments of 402,000 units during the fourth quarter Shipments of the company's desktop systems increased 16 percent to 350,000 in the fourth quarter, compared with the prior year's corresponding quarter. Desktop shipments increased 45 percent compared with the immediately-preceding third quarter of fiscal year 1996 and increased 27 percent compared to the second quarter of 1996. Shipments of the company's notebook systems increased 37 percent to 52,000 notebooks, compared with the prior year's quarter. This included the sale of approximately 7,600 private-label notebooks to Samsung. Notebook shipments increased 68 percent compared with the immediately-preceding third quarter of fiscal year 1996. Americas A·mer·i·cas , the See America. region sales of $314.9 million in the fourth quarter were approximately 21 percent higher than in the prior calendar year period because of strong retail channel sales and higher demand for notebook systems. Sales of $286.5 million within the company's international regions declined approximately 19 percent compared with the prior calendar year period due to slower than expected European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. demand and the impact of the company's continued reorganization activities in the Asia/Pacific region. Compared with the immediately-preceding third quarter, fourth quarter sales in the Americas and international regions grew 38 percent and 58 percent, respectively. Worldwide revenues for fiscal year 1996 declined approximately 10 percent compared to the previous calendar year and included $35 million received from Samsung related to sales of intellectual properties and agreements involving server technologies and strategic marketing consulting, of which $10 million was received in the fourth quarter. Sales of $1.141 billion in the Americas and $927.8 million in international regions represented declines of approximately one percent and 22 percent, respectively, over the immediately preceding 12-month period. The company also announced changes to its board of directors. Effectively immediately, Yong-Ro Song and Ho Moon Kang KANG Kansas Air National Guard , have joined the board, replacing Hyeon-Gon Kim Kim orphan wanders streets of India with lama. [Br. Lit.: Kim] See : Adventurousness and Hee Dong Yoo who have left to pursue other assignments within the Samsung Group The Samsung Group is South Korea's largest conglomerate (chaebol), composed of numerous businesses, including Samsung Electronics, the world's largest electronics company[1] . Mr. Song, 50, is executive vice president and general manager in charge of Samsung Electronic's strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. office. Mr. Kang, 46, presently serves as senior executive managing director of Samsung Electronic's computer division. Balance Sheet Summary Total net inventory was $139.0 million at Dec. 28, 1996, down from $192.3 million at Sept. 28, 1996 and represented inventory turns of 16.3. For fiscal year 1996, AST achieved inventory turns of 15.0, compared with inventory turns of 8.8 achieved during calendar year 1995. At Dec. 28, 1996, accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying totaled $400.1 million, which represented 59 days sales outstanding In accountancy, Days Sales Outstanding is a company's average collection period. A low figure indicates that the company collects its outstanding receivables quickly. Typically it is looked at either quarterly or yearly (90 or 365 days). , down from 76 at Sept. 28, 1996. Total cash and cash equivalents were $61.1 million, with $175.0 million in 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. borrowings, compared with $30.0 million and $124.0 million, respectively, at Sept. 28. During the quarter, the company announced a $200 million increase in bank credit guarantees through December 1998 and an extension of its existing $200 million bank credit guarantee from Samsung Electronics from Dec. 1997 to Dec. 1998. 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. Statements contained in this press release which are not historical information are forward-looking statements as defined within the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Such forward-looking statements are subject to risks and uncertainties which could cause results to differ materially from those projected. Such potential risks and uncertainties include, but are not limited to: the level of competitive pricing pressures in the computer industry; the company's ability to continue to develop, produce and deliver new products that incorporate leading-edge PC technologies on a timely basis, that are competitively priced and achieve significant market acceptance; the effect of any continued losses on the company's supplier and customer relationships; and its ability to fund continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the . Additional factors which could affect the company's financial results are included in the company's report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for Transition Period 1995, which is filed with the Securities and Exchange Commission. Corporate Background AST Research AST Research, Inc. was a personal computer manufacturer, founded in Irvine, California in 1980 by Albert Wong, Safi Qureshey and Thomas Yuen. (The name comes from the initials of their first names. Inc., a member of the Fortune 500 list of America's largest industrial and service companies, is one of the world's leading personal computer manufacturers. The company develops a broad spectrum of desktop, mobile and server PC products that are sold in more than 100 countries worldwide. AST systems meet a wide range of customer needs, ranging from corporate business applications to advanced home and home office use. Corporate headquarters is located at 16215 Alton Alton (ôl`tən), city (1990 pop. 32,905), Madison co., SW Ill., on bluffs of the Mississippi River 5 mi (8.1 km) above its confluence with the Missouri; inc. 1837. Alton is a shipping and industrial center, and there are oil refineries nearby. Parkway, P.O. Box 57005, Irvine, Calif. 92619-7005. Telephone 714/727-4141 or 800/876-4278. Fax: 714/727-9355. Information about AST and its products can be found on the World Wide Web at http://www.ast.com . -0- NOTE: AST(r), Advantage!(r), Ascentia and Bravo BRAVO Cardiology A clinical trial–Blockade of the GP IIB/IIIA Receptor to Avoid Vascular Occlusion– which evaluated lotrafiban in preventing strokes and acute MI. See GP IIB/IIIA. are trademarks of AST Research Inc. Intel and Pentium Pentium Family of microprocessors developed by Intel Corp. Introduced in 1993 as the successor to Intel's 80486 microprocessor, the Pentium contained two processors on a single chip and about 3.3 million transistors. are registered trademarks, and Pentium Pro The sixth generation of the Intel x86 family of CPU chips. The term may refer to the chip or to a PC that uses it. Introduced in 1995 as the successor to the Pentium, models from 150 MHz to 200 MHz were released. is a trademark of Intel Corp. Windows is a registered trademark and Windows NT (Windows New Technology) A 32-bit operating system from Microsoft for Intel x86 CPUs. NT is the core technology in Windows 2000 and Windows XP (see Windows). Available in separate client and server versions, it includes built-in networking and preemptive multitasking. is a trademark of Microsoft (Microsoft Corporation, Redmond, WA, www.microsoft.com) The most successful and influential software company. Microsoft's software and Intel's hardware pioneered the PC and revolutionized the computer industry. Corp. -0-
AST RESEARCH INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
Dec. 28, Dec. 30,
(In thousands) 1996 1995
ASSETS
Current assets:
Cash and cash equivalents $ 61,063 $ 125,387
Accounts receivable, net 400,061 392,598
Inventories 139,007 252,339
Other current assets 38,762 67,297
Total current assets 638,893 837,621
Property and equipment, net 91,612 98,725
Other assets 100,552 119,696
Total assets $ 831,057 $ 1,056,042
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities 679,942 614,075
Long-term debt 131,737 125,540
Other non-current liabilities 7,238 5,545
Total liabilities 818,917 745,160
Preferred stock 27,780 --
Common stock and additional capital 506,375 415,182
Retained earnings (deficit) (522,015) (104,300)
Total shareholders' equity 12,140 310,882
Total liabilities and
shareholders' equity $ 831,057 $ 1,056,042
-0-
AST RESEARCH INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Year Ended
Dec. 28, Dec. 30, Dec. 28, Dec. 30,
(In thousands, except
per share amounts) 1996 1995 1996 1995
Net sales $ 601,429 $ 612,926 $ 2,068,643 $ 2,348,461
Revenue from
related party 10,000 -- 35,000 --
Total revenue 611,429 612,926 2,103,643 2,348,461
Cost of sales 566,755 623,032 2,078,775 2,223,279
Gross profit (loss) 44,674 (10,106) 24,868 125,182
Selling, general and
administrative expenses 92,733 90,553 336,367 327,377
Engineering and
development expenses 11,670 10,041 40,702 37,441
Restructuring charge -- 12,967 6,527 12,967
Other charges -- -- 26,380 --
Total operating expenses 104,403 113,561 409,976 377,785
Operating loss (59,729) (123,667) (385,108) (252,603)
Financing and other
expense, net (8,228) (4,957) (32,607) (19,829)
Loss before income taxes (67,957) (128,624) (417,715) (272,432)
Income tax provision
(benefit) -- -- -- (9,248)
Net loss $ (67,957) $(128,624) $(417,715) $(263,184)
Net loss per share $ (1.18) $ (2.88) $ (8.22) $ (7.01)
Weighted average common
shares outstanding 57,741 44,679 50,827 37,552
-0-
AST RESEARCH, INC.
COMPUTATION OF NET LOSS PER SHARE
(Unaudited)
Three Months Ended Year Ended
Dec. 28, Dec. 30, Dec. 28, Dec. 30,
(In thousands, except
per share amounts) 1996 1995 1996 1995
Primary loss per share
Shares used in computing primary loss per share:
Weighted average shares of common stock
outstanding 57,741 44,679 50,827 37,552
Effect of stock options treated as common stock
equivalents under the
treasury stock method -- -- -- --
Weighted average common and common
equivalent shares
outstanding 57,741 44,679 50,827 37,552
Net loss $ (67,957) $(128,624) $(417,715) $(263,184)
Loss per share--primary $(1.18) $ (2.88) $ (8.22) $ (7.01)
Fully diluted loss per share
Shares used in computing fully diluted loss per share:
Weighted average shares of common stock
outstanding 57,741 44,679 50,827 37,552
Effect of stock options treated as common stock
equivalents under the
treasury stock method -- -- -- --
Shares assumed issued on conversion of
Liquid Yield
Option Notes (LYONs) -- -- -- --
Total fully diluted
shares outstanding 57,741 44,679 50,827 37,552
Net loss - fully diluted earnings per share:
Net loss $ (67,957) $(128,624) $(417,715) $(263,184)
Adjustment for interest
on LYONs, net of tax -- -- -- --
Adjusted net loss--
fully diluted $ (67,957) $(128,624) $(417,715) $(263,184)
Loss per share--
fully diluted $ (1.18) $ (2.88) $ (8.22) $ (7.01)
CONTACT: Emory Epperson (media) 714/727-7958 Mariann Ohanesian (analyst) 714/727-7728 |
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