Exhibit 99.1
Earns 11 Cents Per Share on Record Q4
Sales of $126 Million; Quarterly Branded Revenues up 26 Percent;
Scalar(R) i500 Library Ships
REDMOND, Wash.--(BUSINESS WIRE)--Dec. 15, 2005--Advanced Digital
Information Corporation (NASDAQ: ADIC) today announced net earnings of
$6.4 million, or 11 cents per share, on all-time record quarterly
revenue of $126.2 million for the fiscal fourth quarter ending October
31, 2005. Full fiscal year 2005 earnings totaled $14.3 million, or 23
cents per share, on sales of $454.2 million.
Quarterly net income increased 13 percent on nine percent revenue
growth over the same period last year while operating income grew
approximately 94 percent. Annual net income is up 85 percent on
essentially flat revenue and annual operating income is up 83 percent.
Gross profit as a percentage of sales grew 250 basis points to 31.9
percent during the period versus the same quarter of fiscal 2004 and
increased approximately 220 basis points to 30.6 percent for the full
fiscal year.
"We are pleased to report record total sales and record branded
sales for any quarter in our history as market acceptance of our
products continues to grow. Improved operating performance is evident
as operating income grew at a much faster rate than revenue in both
the quarter and full year," according to Chair and Chief Executive
Officer Peter van Oppen. "In particular, strength in our branded
business offset predicted reductions in our OEM business for the year,
resulting in improved gross margin as a percentage of sales," he said.
"Customers are confirming that ADIC's long-term investment in our
i-layer intelligent storage technology takes the risk out of tape
backup, reduces service costs and lowers total costs of ownership,"
according to van Oppen.
ADIC branded sales were up approximately 26 percent from the same
period last year to 65 percent of total revenue while quarterly OEM
sales were down approximately 13 percent to 35 percent of total
revenue. For the full fiscal year, branded sales were up about 16
percent to 61 percent of total revenue while OEM sales fell 18 percent
to 39 percent of revenue. The Company noted OEM revenues have been
fairly flat for the past three quarters and that the annual decline
had been predicted for several quarters.
"In mid-November, we announced the first customer shipments of our
new Scalar(R) i500 midrange library, which is a significant milestone
for both our branded and OEM business," van Oppen said. The Scalar(R)
i500 is the first in the industry to offer growing midrange
environments the combination of flexible scalability and integrated
intelligence needed to improve the effectiveness of backup.
Quarterly operating expenses grew by $3.7 million compared to the
immediately preceding quarter and approximately $4.2 million versus
the fourth quarter 2004. Sequential and annual increases reflect
increased selling costs related to higher branded sales volumes, R&D
spending connected with the development of the new Scalar(R) i500
library as well as accounting and tax compliance costs. In addition,
operating expenses for the fourth quarter include previously announced
expenses of $1.3 million related the closure of facilities and
restructuring activities in the U.S. and Europe. As a result of new
accounting standards, subsequent quarters are expected to include
non-cash stock option expenses ranging between $662,000 and $1.4
million per quarter based on grants outstanding as of our fiscal year
end. Option grants in subsequent periods may increase non-cash
expenses.
The Company realized tax benefits of $721,000 and $4.2 million for
the fourth quarter and fiscal year 2005, respectively. Such tax
benefits resulted from a combination of the resolution of state tax
audits, completion of a Federal tax audit and release of related tax
contingency reserves.
Net cash provided by operations during fiscal 2005 was $48.6
million and total investment in property, plant and equipment was
$13.9 million. Subtracting cash flow from operations reported through
July 31 indicates fourth quarter cash provided by operations was
approximately $11.4 million.
Total cash and marketable securities reached $252.6 million at the
end of the period, up from $240.6 million reported as of the end of
the third quarter. For the fiscal year, cash and marketable securities
grew from $232.9 million despite repurchase of approximately 2.9
million shares of common stock at an average price of $7.89 per share,
or $22.9 million. Minimal shares were repurchased during the fourth
quarter, primarily as a result of stock trading restrictions
associated with disclosure of the Company's investment and potential
acquisition activities.
Fourth quarter and fiscal 2005 financial results are unaudited.
Final audited results will be available in the Company's Annual Report
on Form 10-K expected to be filed on or before January 16, 2006. The
Company is not presently aware of any reason audited results should
differ from the results presented herein.
About ADIC
Advanced Digital Information Corporation (NASDAQ: ADIC) is a
leading provider of Intelligent Storage(TM) solutions to the open
systems marketplace. ADIC is the world's largest supplier of automated
tape systems using the drive technologies most often employed for
backing up open system, client-server networks.(1) The Company's data
management software, storage networking appliances, and disk-based
backup and restore solutions provide IT managers innovative tools for
storing, managing, and protecting their most valuable digital assets
in a variety of disk and tape environments. ADIC storage products are
available through a worldwide sales force and a global network of
resellers, OEMs and partnerships, including Apple, Dell, EMC,
Fujitsu-Siemens, HP, IBM, and Sun. Further information about ADIC is
available at www.adic.com.
(1) Market Share: Gartner Dataquest, Tape Automation Systems
Market Shares, 2004, F. Yale, August 2005. ADIC and Scalar are
registered trademarks and Intelligent Storage is a trademark of
Advanced Digital Information Corporation. All other trade or service
marks mentioned in this document should be considered the property of
their respective owners.
This release contains forward-looking statements relating to the
Company's future products and services and future operating results
that are subject to risks and uncertainties that could cause actual
results to differ materially from those projected. The words "expect",
"anticipate", and similar expressions identify forward-looking
statements, but their absence does not mean that the statement is not
forward-looking. These statements are not guarantees of future
performance and are subject to certain risks, uncertainties and
assumptions that are difficult to predict. Factors that could affect
the Company's actual results include general economic trends, purchase
deferrals by customers, acceptance of new products, success of new
sales channels, technical competition or obsolescence, supply
constraints, changes in market pricing, production problems and the
Company's ability to complete announced restructurings on schedule.
Reference is made to the Company's Annual Report on Form 10-K for the
year ended October 31, 2004 for a more detailed description of factors
that could affect the Company's actual results. Readers are cautioned
not to place undue reliance on these forward-looking statements, which
speak only as of the date of this release. The Company undertakes no
obligation to update publicly any forward-looking statements to
reflect new information, events or circumstances after the date of
this release or to reflect the occurrence of unanticipated events.
Conference Call
There will be a conference call to discuss fiscal 2005 and fourth
quarter results as well as fiscal 2006 business outlook at 1:30 p.m.
PT (4:30 p.m. ET) on December 15, 2005. The call can be accessed live
on our website at www.adic.com/ir.
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except for per share amounts)
(Unaudited)
Three Months Ended Fiscal Year Ended
October 31, October 31,
2005 2004 2005 2004
-------- -------- -------- --------
Revenue:
Product $111,826 $102,961 $398,527 $409,371
Service 14,346 12,452 55,651 45,448
-------- -------- -------- --------
Total revenue 126,172 115,413 454,178 454,819
Cost of revenue:
Product 75,124 72,869 274,702 290,660
Service 10,771 8,604 40,413 34,928
-------- -------- -------- --------
Total cost of revenue 85,895 81,473 315,115 325,588
Gross profit 40,277 33,940 139,063 129,231
Sales and marketing 17,539 15,897 66,597 64,836
General and administrative 6,874 6,135 25,886 24,242
Research and development 11,494 9,660 42,493 37,925
-------- -------- -------- --------
Operating profit 4,370 2,248 4,087 2,228
Other income, net 1,339 1,409 6,030 3,365
-------- -------- -------- --------
Income before benefit for
income taxes 5,709 3,657 10,117 5,593
Benefit for income taxes (721) (2,036) (4,156) (2,142)
-------- -------- -------- --------
Net income $ 6,430 $ 5,693 $ 14,273 $ 7,735
======== ======== ======== ========
Basic net income per share $ 0.11 $ 0.09 $ 0.23 $ 0.12
======== ======== ======== ========
Diluted net income per share $ 0.11 $ 0.09 $ 0.23 $ 0.12
======== ======== ======== ========
Shares used in computing basic
net income per share 61,353 63,690 62,726 64,023
======== ======== ======== ========
Shares used in computing
diluted
net income per share 61,617 64,057 63,000 64,794
======== ======== ======== ========
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
October 31, 2005 October 31, 2004
---------------- ----------------
ASSETS
Current assets:
Cash and cash equivalents $ 131,554 $ 94,695
Accounts receivable, net 105,879 93,025
Inventories, net 26,218 38,728
Marketable securities 121,025 138,238
Other current assets 15,895 13,602
--------------- ---------------
Total current assets 400,571 378,288
Property, plant and equipment, net 42,499 45,913
Service parts for maintenance, net 26,491 29,993
Investments 3,485 2,769
Other non-current assets 23,041 18,067
--------------- ---------------
$ 496,087 $ 475,030
=============== ===============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Deferred revenue - current $ 39,910 $ 31,727
Other current liabilities 77,637 65,200
--------------- ---------------
Total current liabilities 117,547 96,927
Deferred revenue - long-term 18,242 13,605
Other long-term liabilities 400 600
Shareholders' equity 359,898 363,898
--------------- ---------------
$ 496,087 $ 475,030
=============== ===============
ADVANCED DIGITAL INFORMATION CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Fiscal Year Ended
October 31,
--------------------
2005 2004
--------- ---------
Cash flows from operating activities:
Net income $ 14,273 $ 7,735
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 26,624 24,538
Bad debt expense 899 211
Inventory obsolescence 2,300 3,335
Stock compensation 129 --
(Gain) loss on securities and investment
transactions 59 (73)
Deferred income taxes (6,840) (2,898)
Tax benefit from exercise of stock options 466 1,971
Gain on assets held for sale (2,549) --
Loss on asset impairment 247 --
Other 358 81
Change in assets and liabilities:
Accounts receivable (13,132) 6,616
Inventories 9,928 (8,465)
Other current assets (1,881) (402)
Service parts for maintenance (7,729) (11,032)
Current liabilities 12,042 (4,630)
Deferred revenue 13,450 14,692
--------- ---------
Net cash provided by operating activities 48,644 31,679
--------- ---------
Cash flows from investing activities:
Purchase of property, plant and equipment (13,855) (14,644)
Proceeds from assets held for sale 4,498 16,740
Purchase of marketable securities (261,464) (113,744)
Proceeds from securities transactions 279,775 86,035
Purchase of other investments (776) (692)
Purchase of intangible assets -- (200)
Return of investment on other investments -- 71
--------- ---------
Net cash provided by (used in) investing
activities 8,178 (26,434)
--------- ---------
Cash flows from financing activities:
Repayment of short-term and long-term debt -- (1,221)
Repurchase of common stock (22,893) (9,510)
Proceeds from issuance of common stock for
stock options,
stock warrants and Stock Purchase Plan 3,842 8,073
--------- ---------
Net cash used in financing activities (19,051) (2,658)
--------- ---------
Effect of exchange rate changes on cash (912) 657
--------- ---------
Net increase in cash and cash equivalents 36,859 3,244
Cash and cash equivalents at beginning of period 94,695 91,451
--------- ---------
Cash and cash equivalents at end of period $ 131,554 $ 94,695
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CONTACT: ADIC
Jon Gacek, 425-881-8004
or
Stacie Timmermans, 425-881-8004