CompuCom Reports 4th Quarter and 2000 Operating Results; 4th Quarter Net Earnings Up 59% Over 4th Quarter 1999.Business Editors & High-Tech high-tech also hi-tech adj. Informal Of, relating to, or resembling high technology. high-tech Adjective same as hi-tech Adj. 1. Writers DALLAS--(BUSINESS WIRE)--Jan. 31, 2001 CompuCom Systems, Inc. (Nasdaq:CMPC CMPC Classified Matter Protection and Control CMPC Compañia Manufacturera de Papeles y Cartones S.A. CMPC Cisco Multi-Path Channel CMPC Children's Media Policy Coalition CMPC Central Milk Producers Cooperative CMPC Connecticut Minority Purchasing Council ), a digital infrastructure solutions provider, today announced operating results for the fourth quarter and the year ended December December: see month. 31, 2000. Fourth quarter net earnings increased 59% to $7.7 million when compared to $4.8 million in the fourth quarter 1999 and were 51% higher than the third quarter 2000 net earnings of $5.1 million. Diluted earnings per share diluted earnings per share An earnings measure calculated by dividing net income less preferred stock dividends for a period by the average number of shares of common stock that would be outstanding if all convertible securities were converted into shares of for the quarter of 15 cents represented a 50% increase over both the fourth quarter 1999 and the third quarter 2000. Fourth quarter revenues were $708 million, or below both the fourth quarter 1999 revenues of $736 million and the third quarter 2000 revenues of $725 million. Services revenue of $74.8 million grew 9.2% sequentially when compared to the third quarter 2000 services revenue of $68.5 million and was slightly ahead of fourth quarter 1999 services revenue of $74.2 million. Service gross margin improved to 43.6% compared to 39.8% in the third quarter 2000 and 31.8% a year ago. Full year 2000 net earnings were $7.8 million, (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. 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). related charges of $3.3 million and an after-tax net gain on an investment of $0.6 million) compared to $11.6 million in 1999. Diluted earnings per share were 14 cents (excluding restructuring related charges of six cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. and a net gain on an investment of one cent) compared to 22 cents in 1999. Full year revenues were $2.71 billion compared to $2.95 billion for the prior year, representing a decline of 8.2%. Services revenue for 2000 was $271.5 million compared to $300.1 million in 1999 while services gross margin increased to 36.5% from 33.7% for the full year 1999. J. Edward Coleman Edward Coleman may refer to:
Mr. Coleman Cole·man , Cy Originally Seymour Kauffman. Born 1929. American composer and theatrical producer whose best known Broadway productions include Sweet Charity (1966) and The Will Rogers Follies (1991). continued, "In addition, we believe our recent purchase of certain assets from MicroAge MicroAge (NASDAQ: MICA) is an American technology sales company based in Tempe, Arizona. Founded in 1976 by Jeffrey D. McKeever and Alan P. Hald as a hobby computer store named The Byte Shop. Technology Services and our agreement with Multiple Zones, Inc. to provide our services to their small and medium sized business clients will also further the growth of our services business." "A significant contributor to the sequential improvement in net earnings was the continued improvement in our services business, in terms of both revenue and gross margin," said M. Lazane Smith, CompuCom's senior vice president and chief financial officer. "As a percentage of total gross margin dollars, services gross margin dollars of $32.6 million represented 40.0% compared to 34.4% in the third quarter and 28.6% in the comparable prior year period. In addition, we continue to show improvement in working capital management, evidenced by record high product inventory turns, improved 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 performance and lower financing costs." CompuCom Systems, Inc., (Nasdaq:CMPC) headquartered in Dallas, Texas “Dallas” redirects here. For other uses, see Dallas (disambiguation). The City of Dallas (pronounced [ˈdæl.əs] or [ˈdæl. , is a leading digital infrastructure solutions provider. CompuCom's clients include Fortune 1000 enterprises, vertical industry leaders, major technology equipment providers, leading edge systems integrators An individual or organization that builds systems from a variety of diverse components. With increasing complexity of technology, more customers want complete solutions to information problems, requiring hardware, software and networking expertise in a multivendor environment. and wireless technology providers. CompuCom leverages people, process and technology to offer best in class solutions that enable, optimize optimize - optimisation and operate the digital technology infrastructure. As a Safeguard Scientifics (NYSE NYSE See: New York Stock Exchange :SFE See Sydney Futures Exchange. ) partner company, CompuCom's infrastructure initiatives leverage Safeguard Scientifics' leadership in identifying, developing and operating premier technology companies with a focus on three sectors: software, communications and e-Services An umbrella term for services on the Internet. E-services include e-commerce transaction services for handling online orders, application hosting by application service providers (ASPs) and any processing capability that is obtainable on the Web. See e-speak. . CompuCom is accessible 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.compucom.com. Management from CompuCom Systems, Inc. will host a conference call on Thursday Thursday: see week. , February February: see month. 1, 2001 at 10:00 a.m. EST EST electroshock therapy. EST abbr. electroshock therapy to discuss the results of the quarter and full year. To access the call, please dial 800/875-6883 and reference conference ID No. 179309. The call will also be broadcast on Investor Broadcast Networks' Vcall web site at www.vcall.com. A replay will be available by calling 800/642-1687 and referencing Conference ID No. 179309 through Monday Monday: see week. , February 5, 2001. This press release contains certain 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. regarding revenues, margin, earnings, growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. and certain business trends that involve risks and uncertainties that could cause actual results to differ materially from the results discussed herein. Specifically, the following trends may not continue: the ability to grow product and services revenue; the ability to continue to decrease costs including, among others, financing costs; the ability to improve operational efficiency; the ability to improve services gross margin dollars and services gross margin as a percentage of total gross margin; the ability to continue to improve the balance sheet; the ability to win new clients; the expansion of the services the Company provides may not be as broad as the Company currently expects or widely accepted by clients; the Company's wireless services offerings may not be widely accepted by clients; the manufacturers who use the Company's direct services may elect not to use those services. Other factors that could cause actual results to differ materially are: acquisition integration issues; competitive pricing and supply; lower demand than anticipated for the products and services the Company sells; the impact of the manufacturer's shift to direct marketing programs may be more significant than anticipated; changes to manufacturers' pricing, price protection, rebate rebate, partial refund of the total price paid for goods or services. In the United States, rebates were historically given by railroads to favored shippers as a return on transportation charges. and incentive programs; 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. interest rate fluctuations; general economic conditions; employee turnover; possible future 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. ; and the ability to collect trade and vendor accounts receivable, as well as the risks and uncertainties set forth from time to time in the Company's other public reports and filings and public statements. Recipients of this press release are cautioned to consider these risks and uncertainties and to not place undue reliance on these forward-looking statements.
COMPUCOM SYSTEMS, INC.
CONDENSED COMPARATIVE FINANCIAL DATA
(All amounts in thousands except per share amounts)
(unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
2000 1999 2000 1999
--------- --------- ---------- ----------
Revenue
Product $ 633,618 $ 662,130 $2,439,106 $2,648,341
Service 74,821 74,191 271,531 300,105
Other -- -- -- 3,817
--------- --------- ---------- ----------
Total revenue 708,439 736,321 2,710,637 2,952,263
--------- --------- ---------- ----------
Gross Margin
Product 48,857 58,988 184,976 216,166
Service 32,623 23,576 99,244 101,184
Other -- -- -- 1,719
--------- --------- ---------- ----------
Total Gross Margin 81,480 82,564 284,220 319,069
--------- --------- ---------- ----------
Gross Margin Percentage
Product 7.7% 8.9% 7.6% 8.2%
Service 43.6% 31.8% 36.5% 33.7%
Other -- -- -- 45.0%
--------- --------- ---------- ----------
Total Gross Margin 11.5% 11.2% 10.5% 10.8%
Operating expenses
Selling 19,711 25,384 84,224 108,333
Service 12,581 12,164 49,958 47,828
General and administrative 26,163 25,445 99,940 98,419
Depreciation and
amortization 5,519 5,693 21,863 21,930
Restructuring related
charges 248 387 5,417 387
--------- --------- ---------- ----------
Total operating expenses 64,222 69,073 261,402 276,897
--------- --------- ---------- ----------
Earnings from operations 17,258 13,491 22,818 42,172
Realized gains/(losses) on
marketable securities ( 968) -- 990 --
Financing expenses 3,481 5,749 15,278 23,195
--------- --------- ---------- ----------
Earnings before income taxes 12,809 7,742 8,530 18,977
Income taxes 5,124 2,909 3,412 7,403
--------- --------- ---------- ----------
Net earnings $ 7,685 $ 4,833 $ 5,118 $ 11,574
========= ========= ========== ==========
Earnings per common share
(excluding restructuring
and gains/losses on
marketable securities)
Basic $ .17 $ .10 $ .14 $ .22
Diluted $ .16 $ .10 $ .14 $ .22
Earnings per common share
Basic $ .15 $ .10 $ .09 $ .22
Diluted $ .15 $ .10 $ .09 $ .22
Average common shares
outstanding
Basic 48,962 47,687 48,702 47,657
Diluted 51,420 47,980 49,177 48,274
COMPUCOM SYSTEMS, INC.
SUMMARY BALANCE SHEET
(All amounts in thousands)
(unaudited)
12/31/2000 12/31/1999
-------------- ---------------
Cash $ 14,857 $ 14,060
Accounts Receivable 224,639 218,522
Inventory 77,207 129,076
Other Current Assets 7,626 9,238
-------------- ---------------
Total Current Assets 324,329 370,896
Property and Equipment 24,304 29,718
Other Assets 87,727 97,438
-------------- ---------------
Total Assets $436,360 $498,052
============== ===============
Accounts Payable $112,485 $182,247
Accrued Liabilities 91,211 91,993
Current Portion of Long-Term Debt -- --
-------------- ---------------
Total Current Liabilities 203,696 274,240
Long-Term Debt -- --
Other 3,374 840
Stockholder's Equity 229,290 222,972
-------------- ---------------
Total Liabilities and
Stockholders' Equity $436,360 $498,052
============== ===============
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