Dell's Fourth-Quarter Shipments, Revenue, Operating Income Set Company Records; Q1 Guidance is $9.5 Billion in Sales, 23 Cents in Per-Share Earnings.Business Editors/High-Tech Writers ROUND ROCK, Texas--(BUSINESS WIRE)--Feb. 13, 2003 Dell (Nasdaq:DELL) ended its fiscal 2003 by posting best-ever quarterly product shipments, revenue and operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. in the period ended Jan. 31. The company's strength spanned all customer and product categories around the world. Dell gained almost three points of global market share from one year ago -- more than three points in servers -- and nearly five share points in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . Fourth-quarter unit shipments were 25 percent higher; without Dell, the global industry grew less than 1 percent. Shipments in strategically important countries China, France, Germany Germany (jûr`mənē), Ger. Deutschland, officially Federal Republic of Germany, republic (2005 est. pop. 82,431,000), 137,699 sq mi (356,733 sq km). and Japan increased a combined 39 percent. Dell server growth in those markets was 47 percent. Quarterly revenue was $9.7 billion, up 21 percent from last year. Company earnings were 23 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. , an increase of 35 percent. Full-year net earnings were $2.12 billion, on record revenue of $35.4 billion. Earnings per share for fiscal 2003 reached 80 cents, up from 65 cents absent a special charge in the prior year.
Fourth Quarter Full Year
-------------------------- ---------------------------
(in millions,
except share FY '03 FY '02 Change FY '03 FY '02(a) Change
data)
Revenue $ 9,735 $ 8,061 21% $ 35,404 $ 31,168 14%
Operating Income $ 819 $ 594 38% $ 2,844 $ 2,271 25%
Net Income $ 603 $ 456 32% $ 2,122 $ 1,780 19%
Earnings Per
Share $ 0.23 $ 0.17 35% $ 0.80 $ 0.65 23%
(a) FY02 income and earnings data exclude a $742 million pretax charge
related to job reductions, consolidation of facilities and
impairment of assets. FY02 reported operating income was $1.79
billion and net income was $1.25 billion.
"Customers always look for higher levels of value, particularly when economic conditions are weak," said Kevin KEVIN Keepers of the Eternal Vigilance of the Islamic Nation (fictional, from White Teeth by Zadie Smith) Rollins Rol·lins , Theodore Walter Known as "Sonny." Born 1930. American jazz saxophonist and composer who originated the now standard practice of playing bop in three-quarter time. , Dell's 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. . "And the Dell team is exceptional at continually con·tin·u·al adj. 1. Recurring regularly or frequently: the continual need to pay the mortgage. 2. increasing customer value. "That's why we're we're Contraction of we are. we're we are profitably gaining market share, and consistently producing industry-leading operating results. This performance would be outstanding in any environment, and we have no intention to depart from a very successful strategy." In the first quarter of fiscal 2004, Dell expects that approach to produce a year-over-year increase in company unit volumes of more than 25 percent, compared with anticipated industry growth at a low single-digit rate. Mr. Rollins said that should result in quarterly revenue of $9.5 billion, up 18 percent from last year, and per-share earnings of 23 cents, 35 percent higher. Fourth-quarter operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $819 million was Dell's highest ever. As a percent of revenue, operating income was 8.4 percent, up from the third quarter and one full point higher than a year ago. Operating expenses Operating expenses The amount paid for asset maintenance or the cost of doing business, excluding depreciation. Earnings are distributed after operating expenses are deducted. were 9.9 percent of revenue, matching a company low. Dell's leading asset management helped generate $1.1 billion in cash from operations. Total cash and investments at the end of the quarter totaled $9.9 billion, a company record. Shift From UNIX UNIX Operating system for digital computers, developed by Ken Thompson of Bell Laboratories in 1969. It was initially designed for a single user (the name was a pun on the earlier operating system Multics). Drives Dell Server Growth Dell's 28-percent increase in shipments of PowerEdge servers was more than five times larger than server volumes for the rest of the industry. The company ranks No. 1 in the U.S., No. 2 worldwide, in shipments of servers based on both 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.'s Windows operating system operating system (OS) Software that controls the operation of a computer, directs the input and output of data, keeps track of files, and controls the processing of computer programs. and on Linux Linux Nonproprietary operating system (OS) for digital computers. In 1991 Linus Torvalds of Finland began asking for volunteer programmers over the Internet to collaborate on the development of a UNIX-like OS for personal computers; the “1. . Windows and Linux running on clusters of standards-based servers are increasingly being chosen as 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" , low-cost alternatives to proprietary UNIX platforms for supercomputing applications. According to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. industry analysts, Dell accounts for 65 percent of global revenue from technical clusters, a relatively new but rapidly growing, high-end high-end adj. Informal 1. Appealing to sophisticated and discerning customers: a high-end department store; high-end video equipment. 2. market category. Revenue from external storage systems increased 87 percent year-over-year. The company's most rapid fourth-quarter storage growth came from sales of Dell EMC (1) (EMC Corporation, Hopkinton, MA, www.emc.com) The leading supplier of storage products for midrange computers and mainframes. Founded in 1979 by Richard J. Egan and Roger Marino, EMC has developed advanced storage and retrieval technologies for the world's largest companies. systems for storage-area networks. Combined shipments of Inspiron and Latitude latitude, angular distance of any point on the surface of the earth north or south of the equator. The equator is latitude 0°, and the North Pole and South Pole are latitudes 90°N and 90°S, respectively. notebook computers A laptop computer that weighs in a range from five to seven pounds. The term originated when laptops were routinely more than 10 pounds, and those that became lighter were placed in a special "notebook" category. In practice, notebook computer and laptop computer are synonymous. were up 33 percent, nearly three times the rate of notebook-computer growth for the rest of the industry. Higher demand for notebooks is driven, in part, by growing customer adoption of wireless technology. Volumes of Dell's Dimension and OptiPlex desktop computers increased 24 percent, versus an average 3-percent decline for all other desktop systems. Company Jumps to No. 3 in Asia-Pacific/Japan All of Dell's regional businesses expanded at rates significantly better than the overall industry, led by Asia-Pacific The term Asia-Pacific generally applies to littoral East Asia, Southeast Asia and Australasia near the Pacific Ocean, plus the states in the ocean itself (Oceania). and Japan with 42-percent shipment growth -- 45 percent for servers. Without Dell, the regional industry was up 7 percent overall, 2 percent in servers. Analysts ranked the company No. 3 in the region, up from No. 6 one year ago. Dell's shipments in both the Americas A·mer·i·cas , the See America. and the U.S. grew 26 percent in the fourth quarter; the rest of the U.S. market declined 3 percent. Dell's fourth-quarter U.S. share rose to 30 percent. For the second straight full year, the company ranked No. 1 in all major U.S. product categories: servers, workstations and notebook See notebook computer. 1. (computer) notebook - laptop computer. 2. (tool) notebook - Labtech Notebook. and desktop computers. Dell's 22-percent U.S. server growth was sharply higher than the average of competitors COMPETITORS, French law. Persons who compete or aspire to the same office, rank or employment. As an English word in common use, it has a much wider application. Ferriere, Dict. de Dr. h.t. , and the company gained nearly three points of market share from the year-ago quarter. In the biggest period for home-PC sales, Dell increased shipments to consumers 38 percent, while other companies averaged a 2-percent decline. Quarterly company revenue from Europe, the Middle East and Africa Europe, the Middle East and Africa, usually abbreviated to EMEA, is a regional designation used for government, marketing and business purposes. It is particularly common amongst North American based companies, who often divide their international operations into the (EMEA (Europe, Middle East, Africa) Refers to that region of the world. For example, one might see products packaged differently for the UK, EMEA and Asia Pacific markets. ) surpassed $2 billion for the first time. Regional shipments increased 18 percent to a record level, as volumes for the rest of the industry rose just 2 percent. Over the past year, the gap between Dell's No. 2 regional ranking and market leadership was narrowed by more than four share points, or better than one-third. Dell shipments increased 32 percent in France and 14 percent in Germany; without Dell, industry volumes declined in both countries. Company server units in EMEA were up 29 percent, compared with a 2-percent average for others. In Germany, Dell server volumes were 46-percent higher than in the fourth quarter one year ago. About Dell Dell Computer Corporation (company) Dell Computer Corporation - One of the biggest US manufacturers of IBM PC compatibles. "From notebooks to networks", their slogan says. http://us.dell.com. (Nasdaq:DELL) is a premier provider of products and services required for customers worldwide to build their information-technology and 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 infrastructures. Company revenue for the past year totaled $35.4 billion. Dell, through its direct business model, designs, manufactures and customizes products and services to customer requirements, and offers an extensive selection of software and peripherals. Information on Dell and its products can be obtained at www.dell.com. Dell, PowerEdge, Inspiron, Latitude, Dimension and OptiPlex are trademarks of Dell Computer Corporation. Windows is a registered trademark of Microsoft Corporation (company) Microsoft Corporation - The biggest supplier of operating systems and other software for IBM PC compatibles. Software products include MS-DOS, Microsoft Windows, Windows NT, Microsoft Access, LAN Manager, MS Client, SQL Server, Open Data Base Connectivity (ODBC), MS Mail, . EMC is a registered trademark of EMC Corp. Market comparisons based on IDC data. Dell disclaims any proprietary interest in the marks and names of others. Special note: Statements in this press release that relate to future results and events (including statements about fiscal first-quarter financial and operating performance) are based on the company's current expectations. Actual results in future periods may differ materially from those currently expected or desired because of a number of risks and uncertainties, including general economic and business conditions; the level of demand for the company's products and services; the level and intensity of competition in the technology industry and the pricing pressures that have resulted; the company's ability to timely and effectively manage periodic product transitions, as well as component availability and cost; the company's ability to develop new products based on new or evolving technology and the market's acceptance of those products; the company's ability to manage its inventory levels to minimize In a graphical environment, to hide an application that is currently displayed on screen. For example, in Windows and Mac, the application's window is removed from the screen and represented by an icon on the Windows Taskbar. In the Mac, the icon is placed in the Dock. See Win Minimize windows. excess inventory, declining inventory values and 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. ; the product, customer and geographic geographic /geo·graph·ic/ (je?o-graf´ik) in pathology, of or referring to a pattern that is well demarcated, resembling outlines on a map. geographic pertaining to geography. sales mix sales mix See product mix. of any particular period; the company's ability to effectively manage its operating costs operating costs npl → gastos mpl operacionales ; and the effect of armed hostilities hos·til·i·ty n. pl. hos·til·i·ties 1. The state of being hostile; antagonism or enmity. See Synonyms at enmity. 2. a. A hostile act. b. hostilities Acts of war; overt warfare. or other conflict on the economy generally, on the level of demand for the company's products and services and on the company's ability to manage its supply and delivery logistics logistics In military science, all the activities of armed-force units in support of combat units, including transport, supply, communications, and medical aid. The term, first used by Henri Jomini, Alfred Thayer Mahan, and others, was adopted by the U.S. in such an environment. Additional discussion of these and other factors affecting the company's business and prospects is contained in the company's periodic filings with the Securities and Exchange Commission. NOTE TO EDITORS: In the term "Dell EMC," there is a pipe symbol between "Dell" and "EMC." It was removed for transmission purposes only. Consolidated con·sol·i·date v. con·sol·i·dat·ed, con·sol·i·dat·ing, con·sol·i·dates v.tr. 1. To unite into one system or whole; combine: statements of income and financial position follow.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
(in millions, except per share data)
(unaudited)
Three Months Ended
------------------------
% Growth Rates
Jan. 31, Nov. 1, Feb. 1, ---------------------
2003 2002 2002 Sequential Yr. to Yr.
-------- ------- ------- ---------- ----------
Net revenue $9,735 $9,144 $8,061 6.5% 20.8%
Cost of revenue 7,954 7,482 6,645 6.3% 19.7%
-------- ------- -------
Gross margin 1,781 1,662 1,416 7.2% 25.8%
Selling, general and
administrative 845 787 713 7.3% 18.5%
Research, development
and engineering 117 117 109 0.4% 8.3%
-------- ------- -------
Total operating
expenses 962 904 822 6.4% 17.1%
-------- ------- -------
Operating income 819 758 594 8.1% 37.8%
Investment and other
income, net 42 44 40 (5.1%) 7.6%
-------- ------- -------
Income before income
taxes 861 802 634 7.4% 36.0%
Income tax provision 258 241 178 7.1% 45.2%
-------- ------- -------
Net income $603 $561 $456 7.5% 32.4%
======== ======= =======
Earnings per common
share:
Basic $0.23 $0.22 $0.18
======== ======= =======
Diluted $0.23 $0.21 $0.17
======== ======= =======
Weighted average shares
outstanding:
Basic 2,576 2,582 2,599
Diluted 2,621 2,634 2,690
Percentage of Total Net
Revenue:
-----------------------
Gross margin 18.3% 18.2% 17.6%
Selling, general and
administrative 8.7% 8.6% 8.9%
Research, development
and engineering 1.2% 1.3% 1.3%
Total operating
expenses 9.9% 9.9% 10.2%
Operating income 8.4% 8.3% 7.4%
Income before income
taxes 8.8% 8.8% 7.9%
Net income 6.2% 6.1% 5.7%
Income tax rate 30.0% 30.0% 28.0%
Net Revenue by
Geographic Region:
-----------------------
Percentage of Total Net
Revenue
-----------------------
Americas 69% 72% 70%
Europe 21% 19% 21%
Asia Pacific -- Japan 10% 9% 9%
Net Revenue by Product
Line:
-----------------------
Percentage of Total Net
Revenue
-----------------------
Desktops 55% 52% 57%
Enterprise 19% 20% 18%
Notebooks 26% 28% 25%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
(in millions, except per share data)
(unaudited)
Year Ended
------------------
Jan. 31, Feb. 1, % Growth
2003 2002 Rates
-------- --------- ---------
Net revenue $35,404 $31,168 13.6%
Cost of revenue 29,055 25,661 13.2%
-------- ---------
Gross margin 6,349 5,507 15.3%
Selling, general and administrative 3,050 2,784 9.6%
Research, development and engineering 455 452 0.7%
Special charge(a) -- 482 (100.0%)
-------- ---------
Total operating expenses 3,505 3,718 (5.7%)
-------- ---------
Operating income 2,844 1,789 59.0%
Investment and other income (loss), net(a) 183 (58) N/M
-------- ---------
Income before income taxes 3,027 1,731 74.9%
Income tax provision 905 485 86.8%
-------- ---------
Net income $2,122 $1,246 70.3%
======== =========
Earnings per common share:
Basic $0.82 $0.48
======== =========
Diluted $0.80 $0.46
======== =========
Weighted average shares outstanding:
Basic 2,584 2,602
Diluted 2,644 2,726
Percentage of Total Net Revenue:
------------------------------------------
Gross margin 17.9% 17.7%
Selling, general and administrative 8.6% 8.9%
Research, development and engineering 1.3% 1.5%
Special charge(a) 0.0% 1.5%
Total operating expenses 9.9% 11.9%
Operating income 8.0% 5.8%
Income before income taxes 8.6% 5.6%
Net income 6.0% 4.0%
Income tax rate 29.9% 28.0%
Net Revenue by Geographic Region:
------------------------------------------
Percentage of Total Net Revenue
------------------------------------------
Americas 71% 70%
Europe 19% 21%
Asia Pacific -- Japan 10% 9%
Net Revenue by Product Line:
------------------------------------------
Percentage of Total Net Revenue
------------------------------------------
Desktops 53% 53%
Enterprise 20% 19%
Notebooks 27% 28%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
(a) Special charge for the 12 months ended Feb. 1, 2002 related to
job reductions, consolidation of facilities and impairment of
assets.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Operations
and Related Financial Highlights
Excludes Special Charge
(in millions, except per share data)
(unaudited)
Year Ended
-------------------
Jan. 31, Feb. 1, % Growth
2003 2002 Rates
--------- -------- ---------
Net revenue $35,404 $31,168 13.6%
Cost of revenue 29,055 25,661 13.2%
--------- --------
Gross margin 6,349 5,507 15.3%
Selling, general and administrative 3,050 2,784 9.6%
Research, development and engineering 455 452 0.7%
--------- --------
Total operating expenses 3,505 3,236 8.3%
--------- --------
Operating income 2,844 2,271 25.2%
Investment and other income, net 183 202 (9.0%)
--------- --------
Income before income taxes 3,027 2,473 22.4%
Income tax provision 905 693 30.7%
--------- --------
Net income $2,122 $1,780 19.2%
========= ========
Earnings per common share:
Basic $0.82 $0.68
========= ========
Diluted $0.80 $0.65
========= ========
Weighted average shares outstanding:
Basic 2,584 2,602
Diluted 2,644 2,726
Percentage of Total Net Revenue:
--------------------------------------
Gross margin 17.9% 17.7%
Selling, general and administrative 8.6% 8.9%
Research, development and engineering 1.3% 1.5%
Total operating expenses 9.9% 10.4%
Operating income 8.0% 7.3%
Income before income taxes 8.6% 7.9%
Net income 6.0% 5.7%
Income tax rate 29.9% 28.0%
Note: Percentage growth rates and ratios are calculated based on
underlying data in thousands.
DELL COMPUTER CORPORATION
Condensed Consolidated Statement of Financial Position
and Related Financial Highlights
(in millions, except for "Ratios" and "Other information")
(unaudited)
Jan. 31, Nov. 1, Feb. 1,
2003 2002 2002
-------- --------- ---------
Assets:
-----------------------------------------
Current assets:
Cash and cash equivalents $4,232 $4,034 $3,641
Short term investments 406 270 273
Accounts receivable, net 2,586 2,661 2,269
Inventories, net 306 307 278
Other 1,394 1,483 1,416
-------- --------- ---------
Total current assets 8,924 8,755 7,877
Property, plant and equipment, net 913 882 826
Investments 5,267 4,755 4,373
Other non-current assets 366 320 459
-------- --------- ---------
Total assets $15,470 $14,712 $13,535
======== ========= =========
Liabilities and Stockholders' Equity:
-----------------------------------------
Current liabilities:
Accounts payable $5,989 $5,936 $5,075
Accrued and other 2,944 2,562 2,444
-------- --------- ---------
Total current liabilities 8,933 8,498 7,519
Long term debt 506 514 520
Other 1,158 1,052 802
-------- --------- ---------
Total liabilities 10,597 10,064 8,841
Stockholders' equity 4,873 4,648 4,694
-------- --------- ---------
Total liabilities and stockholders'
equity $15,470 $14,712 $13,535
======== ========= =========
Ratios:
-----------------------------------------
Quick ratio 0.81 0.82 0.82
Days supply in inventory 3 4 4
Days of sales in accounts receivable(a) 28 30 29
Days in accounts payable 68 71 69
-------- --------- ---------
Cash conversion cycle (37) (37) (36)
Other Information:
-----------------------------------------
Headcount (approximate) 39,100 38,200 34,600
Average total revenue/unit (approximate) $1,640 $1,710 $1,700
Note: Ratios are calculated based on underlying data in thousands.
(a) Days of sales in accounts receivable include the effect of
in-transit customer shipments recorded in other current assets for
all periods presented in the consolidated statement of financial
position.
|
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion