5
Daisytek International Corporation
Page 1
Daisytek Reports Record Fourth Quarter and Year End Results
For Immediate Release
Contact: Mark C. Layton Michael Ares or Reba Reid
President, Chief Operating Edelman Financial
Officer and Chief Financial (214) 520-3555
Officer mares@dal.edelman.com
Daisytek International Corporation rreid@edelman.com
(972) 881-4700
mlayton@daisytek.com
or Thomas J. Madden
Vice President, Finance
Daisytek International Corporation
(972) 881-4700
tmadden@daisytek.com
Dallas, Texas (April 29, 1997) - Daisytek International
Corporation (NASDAQ: DZTK) today reported record results for its
fourth quarter and fiscal year ended March 31, 1997.
Net sales for the fourth quarter of fiscal 1997 increased
27.0% to $174.3 million, as compared to $137.2 million for the
same period of fiscal 1996. Net income for the fourth quarter of
fiscal year 1997 was $4.0 million, up 29.6% over last year's
fourth quarter net income of $3.1 million. Earnings per share
for the fourth quarter of fiscal 1997 was $0.58, an increase of
26.1% versus the prior year of $0.46.
Net sales for the year ended March 31, 1997 increased 30.1%
to $603.8 million, as compared to $464.2 million for fiscal 1996.
Net income for fiscal year 1997 increased to $13.4 million.
Earnings per share for fiscal 1997 was $1.93, an increase of
approximately 29.5% versus the prior year, as adjusted to exclude
the approximately $0.10 per share impact of the one-time
inventory purchase actions during the previous year.
6
Daisytek International Corporation
Page 2
Mark C. Layton, President, Chief Operating Officer and Chief
Financial Officer stated, "This year was another huge financial
success for Daisytek, with revenue and profitability both
increasing 30%, on an as adjusted basis. We continue to be
pleased that we have consistently delivered exceptional financial
results to our shareholders, and have exceeded our internal
targets of over 20% growth in revenue and net income. The fourth
quarter of this year was no exception, with net sales and
earnings up by 27.0% and 29.6%, respectively. Gross margin this
quarter increased to 10.0%, slightly higher than recent quarters.
Combined with our success in maintaining SG&A costs, which were
6.0% for the quarter, we were able to report an operating margin
of 4.0%."
Layton added, "Our international businesses drove our strong
performance this quarter. All of our international investments,
including Canada, Mexico, Australia and Latin America, continue
to be successful. Our newest international venture, our
aquisition of Lasercharge, in Australia, has exceeded our
financial expectations and is smoothly integrating into
Daisytek's operations. New business from our third party
logistics subsidiary, Priority Fulfillment Services, was also a
major contributor to fighting off margin pressures caused by the
effects of increasingly larger customers in the overall mix of
business."
Daisytek is a leading wholesale distributor of computer and
office automation supplies and accessories, serving approximately
24,000 customer locations in North America and overseas. Through
its strategic alliance with Federal Express, Daisytek distributes
in excess of 8,000 products from more than 150 manufacturers via
next business day delivery throughout North America. Leading
manufacturers Daisytek represents include Hewlett-Packard, Kodak,
Okidata, Lexmark, IBM, Imation, Apple, Xerox, Sony, Panasonic,
Canon, Epson and Digital Equipment Corporation. You can find
more information about Daisytek at http://www.daisytek.com.
- financial statements follow -
The matters discussed in this press release, and, in particular,
information regarding risks and uncertainties include, but are
not limited to, general economic conditions, industry trends,
integration of business units, the dependence upon and/or loss of
key suppliers or customers, the loss of strategic product
shipping relationships, customer demand, product availability,
competition (including pricing and availability), concentrations
of credit risk, distribution efficiencies, capacity constraints,
technological difficulties, risk of international operations
including exchange rate fluctuations, and the regulatory and
trade environment (both domestic and foreign). A complete
description of these factors, as well as other factors which
could affect the Company's business, is set forth in the
Company's Prospectus dated January 24, 1996, and the Company's 10-
K for the fiscal year ended March 31, 1996.
7
Daisytek International Corporation
Page 3
Daisytek International Corporation and Subsidiaries
Consolidated Statements of Operations
(In Thousands, Except Per Share Data)
(Unaudited)
Three Months Ended Fiscal Year Ended
March 31, March 31,
------------------------------- --------------------------------
1997 1996 %Change 1997 1996 %Change
--------- --------- ------- --------- --------- -------
NET SALES $ 174,343 $ 137,237 27.0% $ 603,814 $ 464,169 30.1%
COST OF SALES 156,840 123,469 27.0% 543,848 416,199 30.7%
--------- --------- ---- --------- --------- ----
Gross profit 17,503 13,768 27.1% 59,966 47,970 25.0%
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 10,552 8,432 25.1% 36,630 29,024 26.2%
--------- --------- ---- --------- --------- ----
Income from operations 6,951 5,336 30.3% 23,336 18,946 23.2%
INTEREST EXPENSE 457 319 43.3% 1,677 1,482 13.2%
--------- --------- ---- --------- --------- ----
Income before
income taxes 6,494 5,017 29.4% 21,659 17,464 24.0%
PROVISION FOR INCOME TAXES 2,487 1,926 29.1% 8,292 6,697 23.8%
--------- --------- ---- --------- --------- ----
NET INCOME $ 4,007 $ 3,091 29.6% $ 13,367 $ 10,767 24.1%
========= ========= ==== ========= ========= ====
NET INCOME PER
COMMON SHARE $ 0.58 $ 0.46 26.1% $ 1.93 $ 1.59(A) 21.4%
========= ========= ==== ========= ========= ====
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 6,899 6,785 6,913 6,757
========= ========= ========= =========
(A) Reflects approximately $0.10 per share for the twelve months ended
March 31, 1996, related to certain one-time inventory purchase actions.
8
Daisytek International Corporation
Page 4
Daisytek International Corporation and Subsidiaries
Consolidated Balance Sheet Data
(In Thousands)
March 31, March 31,
1997 1996
------------- ---------
Trade accounts receivable, net $ 90,446 $ 69,169
Inventories, net of Priority
Fulfillment Services Division $ 54,426 $ 44,358
Inventories, Priority Fulfillment
Services Division $ 10,354 $ --
Long-term debt, less current portion $ 30,454 $ 16,419
Shareholders' equity $ 67,193 $ 51,661
-###-