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DCA REPORTS SECOND QUARTER EARNINGS

 DCA REPORTS SECOND QUARTER EARNINGS
 ALPHARETTA, Ga., Jan. 6 /PRNewswire/ -- Digital Communications


Associates Inc. (DCA) (NYSE: DCA) today reported earnings of $3.0 million or 27 cents per share for its second fiscal quarter ended Dec. 31, 1991, after an unusual charge of $3.25 million (approximately $2.54 million or 23 cents per share after tax) incurred in the settlement of the consolidated securities class action lawsuits filed against DCA.
 Before the unusual charge, DCA said, earnings were $5.6 million or 50 cents per share compared to $5.4 million or 43 cents per share for the same quarter a year ago.
 DCA noted that it recorded net foreign exchange losses of $1.7 million in its second fiscal quarter and $2.5 million in the six months ended Dec. 31, 1991. These losses were comprised of amortization of premiums paid on forward exchange contracts, translation gains and losses, and realized and unrealized losses on forward exchange contracts in the respective periods.
 DCA currently anticipates that -- barring changes in the prices of DCA's products sold in Europe in fiscal 1992 -- the aggregate net losses or gains ultimately realized by DCA in fiscal 1992 on forward exchange contracts are likely to be largely offset by related changes in the U.S. dollar value of DCA's foreign currency denominated revenues, but it is possible that this may not be the case.
 Sales for the quarter ended Dec. 31, 1991, were $51.9 million, compared to $50.2 million reported for the same quarter a year ago. Sales of DCA's 10NET product line, which was sold on June 30, 1991, were $2.1 million for the same quarter a year ago. Average shares outstanding for the quarter ended Dec. 31, 1991, were 11.2 million compared to 12 million for the same quarter a year ago.
 DCA said that for the quarter ended Dec. 31, 1991, its workstation communications products, which include its IRMA, Crosstalk and MacIRMA lines, accounted for 53 percent of its sales; laser printer enhancement products, which include its printer emulation, font software and memory expansion lines, accounted for 33.9 percent of sales; and its workgroup communications products, which include its IRMAtrac, IRMALAN and Select Communications Server lines, accounted for 13.1 percent of sales.
 Earnings for the six months ended Dec. 31, 1991, were $7.3 million or 65 cents per share. Before the unusual charge, DCA said, earnings for the six months ended Dec. 31, 1991, were $9.8 million or 88 cents per share, compared to $7.9 million or 61 cents per share for the same period a year ago.
 For the six months ended Dec. 31, 1991, DCA reported sales of $99.3 million, compared to $92.8 million for the same period a year ago. Sales of DCA's 10Net product line were $3.7 million for the same period a year ago. Average shares outstanding for the six month period were 11.2 million compared to 12.8 million in the same period a year ago. DCA said it had 10.7 million shares outstanding on Dec. 31, 1991.
 On Nov. 25, 1991, DCA announced that it had entered into a settlement of the securities class action lawsuits filed against the company and certain of its officers and directors. Under the settlement, DCA paid $6.25 million and was reimbursed $3 million through applicable insurance policies. Upon final approval of the settlement by the U.S. District Court, Northern District of Georgia, the lawsuits will be irrevocably dismissed, without any admission or finding of any liability or wrongdoing on the part of any of the defendants.
 Located 30 miles north of Atlanta, DCA designs, manufactures and markets products worldwide that enhance productivity for personal computer users. DCA's current fiscal year ends June 30, 1992.
 DIGITAL COMMUNICATIONS ASSOCIATES, INC.
 Consolidated Statements of Income
 (In thousands except net income per share, unaudited)
 3 mos. ended 12/31/91 12/31/90 Pct. chg.
 Net sales $51,916 $50,246 3.3
 Cost of sales 18,943 19,840 (4.5)
 Gross Profit 32,973 30,406 8.4
 Selling, general and
 administrative expenses 19,060 20,529 (7.2)
 Research and development
 expenses 5,744 4,772 20.4
 Amortization of
 intangible assets 975 3,398 (a) (71.3)
 Income From Operations 7,194 1,707 321.3
 Settlement of securities
 class action lawsuits (3,250) ---
 Foreign exchange
 losses, net (1,706) (b) (25)
 Interest and other
 income, net 1,657 2,515 (34.4)
 Income Before
 Income Taxes 3,895 4,197 (7.2)
 Income taxes 857 (1,161) (c)
 Net Income $ 3,038 $ 5,358 (43.3)
 Net Income Per Share $ .27 $0.43 (d)
 Average shares 11,206 12,047
 Consolidated Statements of Income
 (In thousands except net income per share, unaudited)
 6 mos. ended 12/31/91 12/31/90 Pct. chg.
 Net sales $99,306 $92,824 7.0
 Cost of sales 36,611 36,235 1.0
 Gross Profit 62,695 56,589 10.8
 Selling, general and
 administrative expenses 37,145 40,166 (7.5)
 Research and development
 expenses 11,489 9,824 16.9
 Amortization of
 intangible assets 1,950 4,800 (a) (59.4)
 Income From Operations 12,111 1,799 573.3
 Settlement of securities
 class action lawsuits (3,250) ---
 Foreign exchange
 losses, net (2,517) (b) (55)
 Interest and other
 income, net 2,982 5,596 (46.8)
 Income Before
 Income Taxes 9,326 7,340 27.1
 Income taxes 2,052 (532) (c)
 Net Income $ 7,274 $ 7,872 (7.6)
 Net Income Per Share $ .65 $0.61 (d)
 Average shares 11,186 12,813
 (a) Increased by a $1,995,000 amortization expense related to a
 revaluation of the then remaining intangible assets
 associated with DCA's 1987 acquisition of the assets and
 liabilities of Fox Research, Inc.
 (b) In Europe, DCA invoices customers in various foreign
 currencies and is therefore impacted by fluctuations in
 foreign exchange rates. Fluctuations in foreign exchange
 rates impact the valuation of net current assets and revenue
 recorded. From time to time, DCA hedges foreign exchange
 risk associated with existing net current assets by
 purchasing forward exchange contracts. In addition, in
 July 1991, DCA purchased foreign exchange contracts
 relating to some of its future anticipated sales in foreign
 currencies. These contracts mature monthly in approximately
 equal amounts through October 1992. Open forward exchange
 contracts are revalued at each balance sheet date at the
 then current spot or forward exchange rate and any
 unrealized gain or loss is recognized in consolidated net
 income. Consolidated net income is also affected by
 translation gains or losses arising from the translation of
 foreign currency denominated net current assets and by the
 amortization of premiums paid on forward exchange contracts.
 These factors resulted in a net foreign exchange loss of
 $1,706,000 for the quarter ended Dec. 31, 1991, and a loss of
 $2,517,000 for the six months then ended.
 (c) Decreased by $2,000,000 due to the recognition of a
 previously non-deductible tax loss associated with DCA's
 August 1990 disposition of stock in its Digital Transmission
 Systems, Inc. subsidiary.
 (d) The net after-tax effect of the additional amortization and
 the tax credit was approximately $0.03 per share.
 Consolidated Statements of Income
 (Percent of Net Sales)
 Three Months Ended Six Months Ended
 12/31/91 12/31/90 12/31/19 12/31/90
 Net sales 100.0 100.0 100.0 100.0
 Cost of sales 36.5 39.5 36.9 39.0
 Gross Profit 63.5 60.5 63.1 61.0
 Selling, general and
 administrative expenses 36.7 40.8 37.4 43.3
 Research and development
 expenses 11.0 9.5 11.5 10.6
 Amortization of
 intangible assets 1.9 6.8 2.0 5.2
 Income From Operations 13.9 3.4 12.2 1.9
 Settlement of securities
 class action lawsuits (6.3) --- (3.3) ---
 Foreign exchange losses, net (3.3) --- (2.5) ---
 Interest and other income, net 3.2 5.0 3.0 6.0
 Income Before Income Taxes 7.5 8.4 9.4 7.9
 Income taxes 1.7 (2.3) 2.1 (.6)
 Net Income 5.8 10.7 7.3 8.5
 Three Months Ended Six Months Ended
 Product Group Sales As 12/31/91 12/31/90 12/31/91 12/31/90
 A Percent of Total Sales
 Workstation Communications
 Products (IRMA, Crosstalk,
 MacIRMA, etc.) 53.0 57.3 53.3 58.0
 Laser Printer Products
 (Pacific Data Products) 33.9 31.2 34.2 33.3
 Workgroup Communications
 Products (IRMAtrac,
 IRMALAN, Select CS, etc.) 13.1 11.5 (a) 12.5 8.7 (a)
 Total 100.0 100.0 100.0 100.0
 (a) Excludes sales of DCA's 10NET product line which was sold on
 June 30, 1991.
 Consolidated Balance Sheets
 (In thousands, unaudited at December 31)
 12/31/91 6/30/91
 Assets
 Current Assets
 Cash, cash equivalents and
 short-term investments $112,266 $105,758
 Accounts receivable 29,575 26,220
 Inventories 14,479 16,365
 Other current assets 8,246 7,5,000
 Net Property and Equipment 18,477 19,439
 Intangible Assets 64,063 66,013
 Other Assets 4,492 4,545
 Total $256,598 $251,010
 Liabilities and Stockholders' Equity
 Current Liabilities
 Accounts payable and accrued expenses $ 24,322 $ 24,586
 Income taxes payable 9,753 11,850
 Total Current Liabilities 34,075 36,436
 Stockholders' Equity 222,523 214,574
 Total $256,598 $251,010
 -0- 1/6/92
 /CONTACT: MEDIA: William B. Marks, 404-442-4520 (office), 404-987-9565 (after hours), or 404-690-6665 (beeper), or INVESTORS: Kathleen J. Hassett, 404-442-4268, both of DCA/
 (DCA) CO: Digital Communications ST: Georgia IN: CPR SU: ERN


BR-BN -- AT017 -- 7096 01/06/92 18:08 EST
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