Ciprico Reports Third Quarter and Nine-Month Results; 28% Domestic Growth Fueled by NETarray Product.Business Editors MINNEAPOLIS--(BUSINESS WIRE)--July 23, 2001 Ciprico Inc. (Nasdaq:CPCI See CompactPCI. ), a leading manufacturer and marketer of high-performance Adj. 1. high-performance - modified to give superior performance; "a high-performance car" superior - of high or superior quality or performance; "superior wisdom derived from experience"; "superior math students" direct-attached and networked storage solutions, today announced results that were in line with previous guidance for the third quarter and nine-month period ended June June: see month. 30, 2001. Sales for the quarter were $9.5 million, a decrease of 3 percent over the prior year's quarter. Ciprico recorded a net loss for the quarter of ($873,000), or ($0.17) per share, including a charge of ($0.03) per share to cover the cost of staff reductions, as compared to net income of $262,000 or $0.05 per share for the same period last year. For the nine months ended June 30, 2001, sales were $27.9 million versus $24.8 million for the same period last year, an increase of 13 percent. Ciprico recorded a net loss for the first nine months of fiscal 2001 of $1.9 million or ($0.38) per share, as compared with a net income of $213,000 or $0.04 per share for the same period last year. Excluding after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. charges of approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. ($0.08) per share related to the SANStar acquisition and ($0.03) per share related to staff reductions, Ciprico had a net loss of ($0.27) per share for the year-to-date Year-to-date (YTD) The period beginning at the start of the calendar year up to the current date. period. Robert Robert, Henry Martyn 1837-1923. American army engineer and parliamentary authority. He designed the defenses for Washington, D.C., during the Civil War and later wrote Robert's Rules of Order (1876). Noun 1. H. Kill, Ciprico President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "We are encouraged with the strong sales performance in our domestic operations, which were up 28% for the quarter. This growth was primarily driven by our penetration The successful unauthorized breach of a security perimeter. See penetration test. of new broadcast 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 defense opportunities. Our sales continue to reflect strong contributions from the NETarray product, which has contributed $8.7 million in sales this year. "We experienced the economic impacts seen across the industry, especially extremely soft conditions in Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , which pushed us to the
lower end of our guidance for the quarter. Sales to our largest European Europeanemanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. customers were down significantly and we do not expect any significant improvement in the near term. Despite these market conditions, we are very excited about our new customer penetration with the NETarray product. We recently received our first orders under the previously announced SPAWAR SPAWAR Space & Naval Warfare Systems Command (US Navy) SPAWAR Space Warfare program which are scheduled for shipment during the fourth quarter." Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs S. Wargolet, VP-Finance & CFO See Chief Financial Officer. added, "Given the recent softness in demand, we have revised our sales expectations for the fourth quarter and expect a range between $8.0 million to $9.5 million. Looking ahead we feel the cost reduction efforts we implemented during the quarter were prudent to keep us on track towards achieving break-even operating performance over the next 12 to 18 months. These efforts included the reduction of 12 percent of our workforce in addition to the resizing of our international sales offices, which overall are expected to save approximately $1.2 million in annual costs. While we proactively cut costs to streamline streamline, path of a fluid flowing steadily and without appreciable turbulence. A body is said to be streamlined if its shape offers the least possible resistance to a current of air, water, or other fluid. operations, we continue to make aggressive investments in strategic and core product developments which will further impact us in the fourth quarter, as we expect a loss per share in the range of ($0.19) to ($0.27) per share." Kill continued, "We are very pleased with our progress in the R&D areas this year. Our product developments such as the FibreSTORE 2210 and our Talon ruggedized solution, scheduled for release during the first part of 2002, will provide us the ability to further exploit our key markets. In addition, we anticipate the announcement of our first product offerings within our Digital Media Appliance A stand-alone hardware device or software environment dedicated to a specific task. See hardware appliance and software appliance. architecture by early 2002. These products will incorporate the software technology acquired earlier this year. We believe our investments in this area are important to our long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. strategy to be a market leader in visual computing The use of computers for 3D modeling and animation. See visualization. storage solutions." Ciprico will host a conference call on Tuesday Tuesday: see week. , July July: see month. 24 at 10:00 a.m. Central Time and 11:00 a.m. Eastern Time, to discuss this release. The conference call will be broadcast live via the 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 at www.ciprico.com. The conference call will also be available live via telephone at 212-346-6380. A replay will be available until August 1, 2001 at 800-633-8284, replay code 19166285. Certain statements in this news release are forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. and should be read in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with cautionary statements in Ciprico's SEC filings, reports to shareholders and other news releases. Such 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. , which reflect our current view of future events and financial performance, involve known and unknown risks that could cause actual results and facts to differ materially from those expressed in the forward-looking statements for a variety of reasons. Some of these reasons include the integration of the recently acquired technology and personnel; impact on revenues and earnings of the timing of product enhancements and new product releases; market acceptance of new products; sales and distribution issues; competition; dependence on suppliers; dependence on the cost of disk drives; limited backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. and the historic and recurring re·cur intr.v. re·curred, re·cur·ring, re·curs 1. To happen, come up, or show up again or repeatedly. 2. To return to one's attention or memory. 3. To return in thought or discourse. pattern of a disproportionate dis·pro·por·tion·ate adj. Out of proportion, as in size, shape, or amount. dis  pro·por percentage of total quarterly sales occurring the last
month and weeks of a quarter. Investors should take such risks into
account when making investment decisions. Shareholders and other readers
are cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date on which they are made.
Ciprico undertakes no obligation to update publicly or revise any
forward-looking statements.About Ciprico Ciprico designs, manufactures and markets high-performance direct-attached and networked storage solutions, including intelligent hardware, software and professional services (job) professional services - A department of a supplier providing consultancy and programming manpower for the supplier's products. . Ciprico storage solutions are designed for visual computing applications ranging from 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. image data capture, through processing and analysis, to real-time 1. real-time - Describes an application which requires a program to respond to stimuli within some small upper limit of response time (typically milli- or microseconds). Process control at a chemical plant is the classic example. playback Playback could mean:
CIPRICO INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(Amounts in thousands except
per share amounts) Three Months Nine Months
Ended Ended
June 30, June 30,
2001 2000 2001 2000
-------------- ----------------
NET SALES $9,467 $9,742 $27,945 $24,780
Cost of sales 5,338 5,390 16,052 13,482
------ ------ ------- -------
GROSS PROFIT 4,129 4,352 11,893 11,298
OPERATING EXPENSES:
Research and development 2,029 1,202 5,586 3,115
Sales and marketing 2,927 2,775 8,536 7,791
General and administrative 915 429 2,157 1,447
------ ------ ------- -------
Total operating expenses 5,871 4,406 16,279 12,353
------ ------ ------- -------
LOSS FROM OPERATIONS (1,742) (54) (4,386) (1,055)
Other income, primarily interest 419 451 1,497 1,377
------ ------ ------- -------
INCOME (LOSS) BEFORE INCOME TAXES (1,323) 397 (2,889) 322
Income tax expense (benefit) (450) 135 (975) 109
------ ------ ------- -------
NET INCOME (LOSS) $(873) $262 $(1,914) $213
====== ====== ======= =======
Shares used to calculate earnings
(loss) per share:
Basic 5,060 4,990 5,053 4,977
Diluted 5,060 5,057 5,053 5,057
NET EARNINGS (LOSS) PER COMMON
SHARE:
Basic $(0.17) $0.05 $(0.38) $0.04
====== ====== ======= =======
Diluted $(0.17) $0.05 $(0.38) $0.04
====== ====== ======= =======
SALES INFORMATION
Comparative information on sales by market and geographic location for
the period ended June 30 are shown in the charts below (in millions).
For the quarter ended June 30:
2001 2000
----------------- -----------------
Market Sales % of Total Sales % of Total
----------------------------------------------------------------------
Entertainment $4.2 44% $4.4 46%
Government 4.2 44 4.0 41
Other 1.1 12 1.3 13
----- ---------- ----- ----------
Total $9.5 100% $9.7 100%
===== ========== ===== ==========
2001 2000
----------------- -----------------
Geographic Location Sales % of Total Sales % of Total
----------------------------------------------------------------------
Domestic $8.7 92% $6.8 70%
International .8 8 2.9 30
----- ---------- ----- ----------
Total $9.5 100% $9.7 100%
===== ========== ===== ==========
For the nine months ended June 30:
2001 2000
----------------- -----------------
Market Sales % of Total Sales % of Total
----------------------------------------------------------------------
Entertainment $13.5 48% $11.3 46%
Government 10.7 39 8.9 36
Other 3.7 13 4.5 18
----- ---------- ----- ----------
Total $27.9 100% $24.7 100%
===== ========== ===== ==========
2001 2000
----------------- -----------------
Geographic Location Sales % of Total Sales % of Total
----------------------------------------------------------------------
Domestic $23.7 85% $18.2 73%
International 4.2 15 6.5 27
----- ---------- ----- ----------
Total $27.9 100% $24.7 100%
===== ========== ===== ==========
CIPRICO INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands) June 30, Sept. 30,
2001 2000
-------- ---------
ASSETS
Current assets:
Cash and cash equivalents $3,000 $3,496
Marketable securities 21,455 21,867
Accounts receivable, less allowance 5,790 5,532
Inventories 6,061 5,760
Deferred income taxes 1,648 898
Other current assets 629 584
-------- --------
Total current assets 38,583 38,137
Property and equipment, net 3,211 3,011
Marketable securities 8,534 10,070
Other assets 548 563
-------- --------
$50,876 $51,781
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $3,110 $2,785
Accrued expenses 1,935 1,322
Deferred revenue 362 387
-------- --------
Total current liabilities 5,407 4,494
Shareholders' equity:
Capital stock 51 50
Additional paid-in capital 36,241 36,197
Retained earnings 9,186 11,100
Deferred compensation from restricted stock (9) (60)
-------- --------
Total shareholders' equity 45,469 47,287
-------- --------
$50,876 $51,781
======== ========
CIPRICO INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
(In thousands) Nine Months Ended
June 30,
2001 2000
------------------
Cash flows from operating activities:
Net income (loss) $(1,914) $213
Depreciation and amortization 1,622 1,910
Changes in operating assets and liabilities (503) (1,920)
-------- -------
Net cash flows provided by (used in) operating
activities (795) 203
-------- -------
Cash flows from investing activities:
Equipment purchases (1,828) (1,351)
Purchases of marketable securities (37,542) (35,069)
Proceeds from sale or maturity of marketable
securities 39,490 35,487
-------- -------
Net cash flows provided by (used in) investing
activities 120 (933)
-------- -------
Cash flows from financing activities:
Repurchase of common stock (52) (263)
Proceeds from issuance of common stock 231 405
-------- -------
Net cash flows provided by (used in) financing
activities 179 142
-------- -------
Net increase (decrease) in cash and cash equivalents (496) (588)
Cash and cash equivalents at beginning of period 3,496 3,539
-------- -------
Cash and cash equivalents at end of period 3,000 2,951
Marketable securities, current 21,455 21,869
Marketable securities, non-current 8,534 7,532
-------- -------
Total cash and marketable securities $32,989 $32,352
======== =======
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