Iomega Reports Second-Quarter Profit of $40.4 Million.Business Editors/High-Tech Writers ROY, Utah--(BUSINESS WIRE)--July 13, 2000 Iomega Corporation (company, storage) Iomega Corporation - A storage device manufacturer whose major products are the Zip and Jaz removable disk drives and Ditto tape drives. They became popular with an early product called the Bernoulli Box. (NYSE NYSE See: New York Stock Exchange : IOM IOM See: Index and Option Market ) today reported net income of $40.4 million, or $0.15 per 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. share, for the second quarter ended June June: see month. 25, 2000, which included $15.3 million, or $0.05 per diluted share, attributable attributable emanating from or pertaining to attribute. attributable proportion see attributable risk (below). attributable risk to a decrease in the Company's valuation allowance for net deferred tax assets, and also included $2.5 million, or $0.01 per diluted share, attributable to a reversal reversal n. the decision of a court of appeal ruling that the judgment of a lower court was incorrect and is reversed. The result is that the lower court which tried the case is instructed to dismiss the original action, retry the case, or is ordered to change its of restructuring charges restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. previously recorded. This compares to a second quarter 1999 loss of $47.1 million, or ($0.17) per diluted share, which included a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta restructuring charge of $41.9 million, or ($0.10) per diluted share after tax. Second quarter 2000 revenue of $303.6 million compares to second quarter 1999 revenue of $348.8 million "I am very pleased with our third consecutive quarter of profitability, said Bruce Bruce, Scottish royal family descended from an 11th-century Norman duke, Robert de Brus. He aided William I in his conquest of England (1066) and was given lands in England. Albertson, Iomega (Iomega Corporation, San Diego, CA, www.iomega.com) A mass storage company founded in 1980 that offers a variety of optical, hard disk and proprietary disk storage devices. In the early 1980s, Iomega introduced the Bernoulli Box, which was the first high-capacity, removable disk for president and chief executive officer. "We recently announced several exciting new products that move Iomega beyond the computer room and we intend to leverage the Iomega name in establishing new products, partnerships and alliances with key industry players. We saw continued growth in optical sales of ZipCD The name of an earlier CD-RW drive from Iomega that was introduced in 1999. See Iomega and Zip disk. during the second quarter and I am delighted to see greater 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 acceptance of the Clik! platform in the digital audio market. During the second quarter, we also expanded our retail focus and experienced a series of significant wins in this channel." "The new Iomega is an energized team dedicated to growing our business profitably," continued Albertson. "You can feel this energy in everything we do from dealer structure, packaging and store displays to new products. Iomega is moving towards a convergence convergence Mathematical property of infinite series, integrals on unbounded regions, and certain sequences of numbers. An infinite series is convergent if the sum of its terms is finite. as our new products, multi-channel See multichannel. focus, people, processes, advertising and marketing are beginning to work together, building on our profitability and significant cash position, to fuel the next stage - profitable growth for 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. shareholder value." Second quarter 2000 Zip(R) product profit margin (PPM) of $69.6 million increased $36.7 million over second quarter 1999, while Zip revenue decreased $37.1 million. The Zip PPM increase reflected increased unit sales unit sales Sales measured in terms of physical units rather than dollars. Unit sales data are often used by financial analysts when evaluating the health of a company. of Zip 250MB drives and decreased manufacturing and 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. . Revenue declined in the second quarter 2000 from the same period last year due to lower Zip drive See Zip disk. (hardware, storage) Zip Drive - A disk drive from Iomega Corporation which takes removable 100 megabyte hard disks. Both internal and external drives are manufactured, making the drive suitable for backup, mass storage or for moving files between computers. and disk unit -sales. Iomega's second quarter 2000 Zip drive shipments were 1.6 million units (excluding licensee licensee n. a person given a license by government or under private agreement. (See: license, licensor) LICENSEE. One to whom a license has been given. 1 M. Q. & S. 699 n. shipments), a decrease of .6 million units from the second quarter 1999. Zip disk A 3.5" removable disk drive from Iomega. Zip disks come in 100MB, 250MB and 750MB varieties, with the latter introduced in 2002 using USB and FireWire interfaces. The 250MB drives, introduced in 1998, also read and write 100MB disks. units shipped in the second quarter of 2000 were 14.3 million, a decrease of 2.9 million units from the second quarter 1999. Iomega's OEM unit sales were 50 percent during the second quarter of 2000, essentially flat with second quarter 1999. Cumulative worldwide shipments (including licensee shipments) now exceed 37 million Zip drives and 223 million Zip disks. Second quarter 2000 Jaz See Jaz disk. 1. (language) JAZ - An early system on the LGP-30. [CACM 2(5):16, May 1959]. 2. Jaz - Jaz Drive (R) PPM of $11.8 million increased $14.0 million over second quarter 1999, while Jaz revenue decreased $27.1 million. The Jaz PPM increase reflected lower Jaz manufacturing and operating expenses. Jaz drive See Jaz disk. (hardware, storage) Jaz Drive - Iomega Corporation's drive which takes removable one or two gigabyte disk cartridges which contain conventional hard disks. shipments in the second quarter of 2000 were 68 thousand units, a decrease of 54 thousand units from second quarter 1999. Jaz disk A removable hard disk drive from Iomega. Introduced in late 1995, Iomega startled the industry with its breakthrough price of $99 for a 1GB removable disk cartridge. Jaz was fairly popular in its niche, and 2GB drives were introduced in 1997. shipments in the second quarter of 2000 were 294 thousand units, a decrease of 195 thousand units from second quarter 1999. Second quarter 2000 Clik!(TM)product loss of $3.3 million represented an improvement of $13.5 million over second quarter 1999. Clik! revenue increased $2.6 million year-over-year. Clik! drive See PocketZip disk. shipments during the second quarter 2000 were 26 thousand units, an increase of 22 thousand units over the second quarter 1999. Clik! disk See PocketZip disk. shipments in the second quarter of 2000 were 72 thousand units, an increase of 50 thousand units from second quarter 1999. Second quarter 2000 ZipCD(TM) PPM was $0.7 million on revenue of $24.6 million, an increase of $13.8 million over first quarter 2000. ZipCD drive shipments in the second quarter of 2000 were 120 thousand units, an increase of 68 thousand units from first quarter 2000. During the second quarter of 2000, Iomega decreased its valuation allowance for net deferred tax assets by $15.3 million as a result of the pre-tax income recognized during the quarter. The decrease in the valuation allowance substantially offset the income tax provision that otherwise would have been reported at statutory rates. At June 25, 2000, the valuation allowance for net deferred tax assets was $37.3 million for the U.S. operations and $12.9 million for foreign operations. For the first six months of 2000, Iomega's revenue totaled $648.5 million compared to $735.0 million for the first six months of 1999. Iomega's net income for the first six months of 2000 totaled $92.2 million or $0.33 per diluted share, which included $35.4 million, or $0.13 per diluted share, attributable to a decrease in the Company's valuation allowance for net deferred tax assets, and also included $2.5 million, or $0.01 per diluted share, attributable to a reversal of restructuring charges previously recorded. This compared to a net loss of $46.5 million or ($0.17) per diluted share for the same period in 1999, which included a pre-tax restructuring charge of $41.9 million, or ($0.10) per diluted share after tax. Iomega's balance sheet and liquidity continued to strengthen in the second quarter of 2000. Cash, cash equivalents, and temporary investments of $354 million at June 25, 2000 represented an increase of $80 million from March 26, 2000 and an increase of $265 million from one year ago. About Iomega Iomega Corporation (NYSE:IOM) manufactures and markets the award-winning Adj. 1. award-winning - having received awards; "this award-winning bridge spans a distance of five miles" Zip(R), Jaz(R) and Clik!(TM) drives and disks and markets the ZipCD(TM) CD-RW (CD-ReWritable) The only rewritable CD technology. CD-RW disks look like other CD media, but with close inspection, they have a more polished surface with a very dark blue-gray cast. drives and discs. Iomega's products help people to save, share, manage and create important information such as spreadsheets The following is a list of spreadsheets. Freeware/open source software Online spreadsheets
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 downloads, audio files and personal photographs, while protecting that content from viruses and hackers. Used in homes, businesses, government and educational facilities and by creative professionals everywhere, Iomega storage solutions are the enabling technologies preferred by millions. The Company can be reached at 1-800-MY-STUFF (800-697-8833), or on the Web at http://www.iomega.com. Special Note: The statements in this release relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc the Company's future plans for marketing, new products and alliances and future growth and operating results are 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. . There are a number of important factors that could cause actual results to differ materially from those suggested or indicated by such forward-looking statements, including retail and OEM market acceptance of and demand for the Company's existing and new products, the Company's success in timely producing and marketing its products, ability to maintain stringent quality assurance standards and enhanced customer service, availability of critical product components, success of the Company's new marketing initiatives, manufacturing and inventory issues, intellectual property rights, competition, 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. , general economic and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. industry-specific conditions and the other factors described in Iomega'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 the year ended December December: see month. 31, 1999, and its most recent quarterly reports filed with the SEC. Copyright (c) 2000 Iomega Corporation. Iomega, Zip, Zip 100, Zip 250, Jaz, Clik!, and ZipCD are either registered trademarks or trademarks of Iomega Corporation 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. and/or other countries. Certain other product names, brand names, and company names may be trademarks or designations of their respective owners. Supplemental financial information regarding product revenue and units, revenue by region, cash conversion days and inventory turns is available at our web site: www.iomega.com/about/investor/00q2supp.pdf. In addition, the information provided below is also available at the following location: www.iomega.com/about/investor/00q2pres.pdf. Investors and others without Internet access See how to access the Internet. may contact the company at 1-801-332-3585 or by e-mail to investorrelations@iomega.com.
IOMEGA CORPORATION
CONDENSED STATEMENTS OF OPERATIONS - QTD
(In thousands, except per share data)
(Unaudited)
For the Three Months Ended
--------------------------------
June 25, June 27, March 26,
2000 1999 2000
--------- --------- ---------
SALES $303,639 $348,781 $344,897
COST OF SALES 183,628 273,020 216,990
--------- --------- ---------
Gross margin 120,011 75,761 127,907
--------- --------- ---------
OPERATING EXPENSES:
Selling, general and
administrative 69,254 82,828 65,246
Research and development 15,318 23,085 11,130
Restructuring charge (reversal) (2,497) 41,909 0
--------- --------- ---------
Total operating expenses 82,075 147,822 76,376
--------- --------- ---------
OPERATING INCOME (LOSS) 37,936 (72,061) 51,531
Interest and other income
and expense, net 3,230 (328) 1,233
--------- --------- ---------
INCOME (LOSS) BEFORE INCOME TAXES 41,166 (72,389) 52,764
BENEFIT (PROVISION) FOR
INCOME TAXES (16,064) 25,336 (21,044)
DECREASE IN TAX VALUATION
ALLOWANCE 15,268 0 20,106
--------- --------- ---------
NET INCOME (LOSS) $40,370 ($47,053) $51,826
========= ========= =========
NET INCOME (LOSS) PER COMMON SHARE
BASIC $0.15 ($0.17) $0.19
========= ========= =========
DILUTED $0.15 ($0.17) $0.19
========= ========= =========
COMMON SHARES OUTSTANDING 270,638 269,115 270,448
========= ========= =========
COMMON SHARES ASSUMING DILUTION 281,351 269,115 281,235
========= ========= =========
====================== =================== ================
PRODUCT REVENUES & PROFIT MARGINS - QTD
(In thousands)
(Unaudited)
For the Three Months Ended
--------------------------------
June 25, June 27, March 26,
2000 1999 2000
--------- --------- ---------
Revenues:
Zip $237,290 $274,383 $278,517
Jaz 37,883 65,003 51,847
Clik! 3,209 627 2,054
ZipCD 24,585 4 10,778
Other 672 8,764 1,701
--------- --------- ---------
Total Revenues $303,639 $348,781 $344,897
========== ========= =========
Product Profit Margin (Loss):
Zip 69,615 32,872 87,941
Jaz 11,803 (2,193) 12,463
Clik! (3,257) (16,780) (16,269)
ZipCD 656 (2,031) (104)
Other (2,406) (9,378) (2,363)
--------- --------- ---------
Total Product Profit
Margin 76,411 2,490 81,668
Common
General corporate expenses 40,972 32,642 30,137
Restructuring charge (reversal) (2,497) 41,909 0
Interest and other income
and expense, net (3,230) 328 (1,223)
--------- --------- ---------
Income (Loss) Before Income Taxes $41,166 ($72,389) $52,764
========= ========= =========
====================== ====================== ===================
IOMEGA CORPORATION
CONDENSED STATEMENTS OF OPERATIONS - YTD
(In thousands, except per share data)
(Unaudited)
For the Six Months Ended
--------------------------------
June 25, June 27,
2000 1999
--------- ---------
SALES $648,536 $734,993
COST OF SALES 400,618 565,496
--------- ---------
Gross margin 247,918 169,497
--------- ---------
OPERATING EXPENSES:
Selling, general and
administrative 134,500 152,769
Research and development 26,448 43,798
Restructuring charges (reversal) (2,497) 41,909
--------- ---------
Total operating expenses 158,451 238,476
--------- ---------
OPERATING INCOME (LOSS) 89,467 (68,979)
Interest and other income
and expense, net 4,463 (2,533)
--------- ---------
INCOME (LOSS) BEFORE INCOME TAXES 93,930 (71,512)
BENEFIT (PROVISION) FOR
INCOME TAXES (37,108) 25,028
DECREASE IN TAX VALUATION
ALLOWANCE 35,374 0
--------- ---------
NET INCOME (LOSS) $92,196 ($46,484)
========= =========
NET INCOME (LOSS) PER COMMON SHARE:
BASIC $0.34 ($0.17)
========= =========
DILUTED $0.33 ($0.17)
========= =========
COMMON SHARES OUTSTANDING 270,543 268,753
========= =========
COMMON SHARES ASSUMING DILUTION 281,293 268,753
========= =========
====================== =================== ================
PRODUCT REVENUES & PROFIT MARGINS - YTD
(In thousands)
(Unaudited)
For the Six Months Ended
--------------------------------
June 25, June 27,
2000 1999
--------- ---------
Revenues :
Zip $515,806 $576,229
Jaz 89,731 128,341
Clik! 5,264 5,729
ZipCD 35,364 4
Other 2,371 24,690
--------- ---------
Total Revenues 648,536 734,993
========= =========
Product Profit Margin (Loss):
Zip $157,557 $ 84,096
Jaz 24,266 (5,188)
Clik! (19,526) (29,809)
ZipCD 552 (2,807)
Other (4,770) (15,987)
--------- ---------
Total Product Profit
Margin 158,079 30,305
Common
General corporate expenses 71,109 57,375
Restructuring charges (reversal) (2,497) 41,909
Interest and other income
and expense, net (4,463) 2,533
--------- ---------
Income (Loss) Before Income Taxes $93,930 ($71,512)
========= =========
====================== ====================== ===================
IOMEGA CORPORATION
CONDENSED BALANCE SHEETS
(In thousands)
(Unaudited)
June 25, June 27, March 26,
2000 1999 2000
-------- -------- --------
ASSETS:
Cash and cash equivalents $278,583 $ 89,281 $190,927
Temporary investments 75,332 0 82,502
Trade receivables 168,716 197,785 160,340
Inventories 75,733 138,400 84,588
Other current assets 24,293 88,923 45,974
-------- -------- --------
Total current assets 622,657 514,389 564,331
Fixed assets (net) 108,882 173,559 120,665
Intangible and other assets 30,446 53,781 32,468
-------- -------- --------
$761,985 $741,729 $717,464
======== ======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Notes payable $ 0 $ 383 $ 0
Current lease obligations 4,444 4,014 4,784
Accounts payable 104,210 135,883 111,020
Convertible notes 45,505 0 45,505
Other current liabilities 191,977 175,656 180,498
-------- -------- --------
Total current liabilities 346,136 315,936 341,807
Long-term liabilities 781 5,089 1,058
Convertible notes 0 45,505 0
Stockholders' equity 415,068 375,199 374,599
-------- -------- --------
$761,985 $741,729 $717,464
======== ======== ========
CONDENSED STATEMENTS OF CASH FLOWS - YTD
(In thousands)
(unaudited)
For the Six Months Ended
------------------------
June 25, June 27,
2000 1999
----------- ----------
Cash Flows from Operating Activities:
Net Income (Loss) $ 92,196 ($ 46,484)
Non-Cash Revenue and Expense
Adjustments 40,116 80,808
--------- ---------
132,312 34,324
Changes in Assets and Liabilities:
Trade receivables 22,993 43,902
Inventories 18,893 22,112
Other current assets 4,751 9,135
Accounts payable (31,405) (36,880)
Other current liabilities 6,735 1,974
--------- ---------
Net cash provided by
operating activities 154,279 74,567
--------- ---------
Cash Flows from Investing Activities:
Purchase of property, plant and
equipment (11,238) (25,688)
Acquisition of business assets - Syquest 0 (12,093)
Sale of temporary investments 66,578 0
Purchase of temporary investments (103,701) 0
Net (increase) decrease in other assets 401 (1,955)
--------- ---------
Net cash used in investing
activities (47,960) (39,736)
--------- ---------
Cash Flows from Financing Activities:
Proceeds from sale of Common Stock 1,241 3,706
Net payments on notes payable and
capitalized lease obligations (1,683) (39,529)
Purchase of Common Stock 0 0
--------- ---------
Net cash used in
financing activities (442) (35,823)
--------- ---------
Net Increase (Decrease) in Cash and Cash
Equivalents 105,877 (992)
Cash and Cash Equivalents at
Beginning of Period 172,706 90,273
--------- ---------
Cash and Cash Equivalents at
End of Period $278,583 $ 89,281
========= =========
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