Cabletron Systems Announces Third Quarter Results.ROCHESTER, N.H.--(BUSINESS WIRE)--Dec. 21, 1998--Cabletron Systems, Inc. (NYSE NYSE See: New York Stock Exchange :CS) today reported financial results for the third quarter of fiscal 1999 ended November 30, 1998. Net sales Net Sales The amount a seller receives from the buyer after costs associated with the sale are deducted. Notes: This amount is calculated by subtracting the following items from gross sales: merchandise returned for credit, allowances for damaged or missing goods, freight for the third quarter were $329.9 million as compared with $331.8 million in the third quarter of fiscal 1998. Net loss for the quarter was $21.2 million, or ($0.12) per share, exclusive of special charges of $63.8 million (net of tax) or $(0.38) per share, compared to net income of $19.9 million or $0.12 per share on a 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. basis, in the comparable period last year. There were no special charges related to acquisitions in the quarter a year ago. Third quarter 1999 special charges of $74.7 million ($63.8 million or $.38 net of tax) were for in process research and development for the completion of the acquisitions of NetVantage, Inc., Flowpoint, Inc., and the DSLAM (DSL Access Multiplexor) A central office (CO) device for ADSL service that intermixes voice traffic and DSL traffic onto a customer's DSL line. It also separates incoming phone and data signals and directs them onto the appropriate carrier's network. See DSL. division of Ariel Corporation. Including these items, the Company reported a net loss for the third quarter of fiscal 1999 of $85.0 million, or $0.50 per share. During the quarter, the Company completed its acquisition of NetVantage, Inc. on September 25, 1998, opening new markets in the SOHO Soho (sōhō`, sə–), district of Westminster, London, England, known for its continental restaurants. Once a fashionable quarter, it became popular among writers and artists in the 19th cent. switching market. Additionally, Cabletron completed the acquisitions of Flowpoint, Inc. and Ariel's DSLAM division in early September, placing the company at the heart and edge of the DSL DSL in full Digital Subscriber Line Broadband digital communications connection that operates over standard copper telephone wires. It requires a DSL modem, which splits transmissions into two frequency bands: the lower frequencies for voice (ordinary marketplace as it prepares to expand next year. "We have some work to do on our operating basis but I am enthused by the growth in our key driving sectors including the SmartSwitch Router router Portable electric power tool used in carpentry and furniture making that consists of an electric motor, a base, two handle knobs, and bits (cutting tools). A router can cut fancy edges for shelving, grooves for storm windows and weather stripping, circles and ovals " commented Craig Benson Craig Benson (born New York City, October 8, 1954) came to public attention by founding Cabletron Systems, now known as Enterasys Networks that became one of the largest employers in New Hampshire, and was governor of the state from January 2003 to January 2005. , Chairman and Chief Executive Officer. "During the coming quarter, we will continue to prioritize pri·or·i·tize v. pri·or·i·tized, pri·or·i·tiz·ing, pri·or·i·tiz·es Usage Problem v.tr. To arrange or deal with in order of importance. v.intr. aggressive programs for revenue growth and we will look to align align (  līn),v to move the teeth into their proper positions to conform to the line of occlusion. our business to those growth areas." About Cabletron Systems Cabletron Systems, a premier provider of enterprise-class networking solutions, delivers dependable network access and communications to millions of people worldwide. With scaleable products designed for Fortune 1000 enterprise networks, service providers and small businesses, Cabletron provides simple, reliable and cost-effective cost-effective, n the minimal expenditure of dollars, time, and other elements necessary to achieve the health care result deemed necessary and appropriate. business solutions for the information age. Cabletron's web site can be reached on the Internet at: http://www.cabletron.com. The statements in this press release regarding future events or results constitute forward looking information, and actual results could differ materially. Among the factors that could cause actual results to differ are general competitive conditions, including the adverse margin impact of pricing competition. Other factors include the effect of lower margin reseller An organization that sells hardware and software to the general public. Resellers purchase products from software publishers and hardware manufacturers. sales, difficulties in assimilating as·sim·i·late v. as·sim·i·lat·ed, as·sim·i·lat·ing, as·sim·i·lates v.tr. 1. Physiology a. To consume and incorporate (nutrients) into the body after digestion. b. recently acquired companies, risks of entering new markets and distribution channels, and changes in overall demand levels for computer networking
Computer networking is the engineering discipline concerned with communication between computer systems or devices. products. Finally, the resolution of the previously disclosed SEC review of the company's historical financial statements could cause actual results to differ from those projected. For a detailed discussion of the risks and uncertainties related to the company's business, please refer to the company's quarterly report on Form 10-Q Form 10-Q See 10-Q. for the period ended August 31, 1998 and the company's annual 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 fiscal 1998. -0-
CABLETRON SYSTEMS, INC.
Consolidated Condensed Statements of Operations (three months ended
November 30, 1998 and 1997)
(in thousands, except per share data)
(unaudited)
Third Quarter
1999 1998
Net sales $329,868 $331,827
Cost of sales 197,041 164,254
Gross profit 132,827 167,573
Operating expenses:
R & D 51,484 46,552
S G & A 116,965 95,521
Special Charges 74,650 --
Operating income (loss) (110,272) 25,500
Interest income 3,493 4,648
Income (loss) from operations
before income taxes (106,779) 30,148
Income tax expense (benefit) (21,761) 10,250
Net Income (loss) ($85,018) $19,898
Earnings (loss) per share - Basic ($0.50) $0.13
Weighted average number of common
shares outstanding - Basic 169,658 157,986
Earnings (loss) per share - Diluted ($0.50) $0.12
Weighted average number of common shares
outstanding - Diluted 169,658 159,875
CABLETRON SYSTEMS, INC.
Consolidated Condensed Balance Sheets (November 30, 1998 and
February 28, 1998)
(in thousands)
Assets (unaudited)
11/30/98 2/28/98
Cash & short-term investments $216,285 $324,057
Accounts receivable (net) 225,303 241,181
Inventories 243,008 309,667
Deferred income taxes 78,032 81,161
Other assets 58,870 78,084
Total current assets 821,498 1,034,150
Investments 178,199 123,272
Property, plant & equipment (net) 211,498 244,730
Intangible assets 98,364 36,867
Deferred income taxes 167,295 167,308
Total assets $1,476,854 $1,606,327
Liabilities & Stockholders' Equity
Accounts payable $95,607 $79,969
Other current liabilities 338,342 392,781
Total current liabilities 433,949 472,750
Long-term obligations -- 132,500
Long-term deferred income taxes 22,037 12,057
Total liabilities 455,986 617,307
Stockholders' equity 1,020,868 989,020
Total liabilities & stockholders' equity $1,476,854 $1,606,327
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