Western Digital® Announces Fiscal Year Revenue Of $15.4 Billion And Non-GAAP Net Income Of $2.1 Billion, Or $8.53 Per Share(1) For Fourth Quarter, Revenue of $3.7 Billion, Non-GAAP Net Income of $477 Million, or $1.96 Per Share

IRVINE, Calif., July 24, 2013 /PRNewswire/ -- Western Digital® Corp. (NASDAQ: WDC) today reported revenue of $15.4 billion and net income of $1.7 billion, or $6.75 per share for fiscal year 2013, compared to fiscal 2012 revenue of $12.5 billion and net income of $1.6 billion, or $6.58 per share. On a non-GAAP basis, fiscal 2013 net income was $2.1 billion or $8.53 per share, compared to fiscal 2012 net income of $2.1 billion or $8.61 per share.1

For its fourth fiscal quarter ended June 28, 2013, the company reported revenue of $3.7 billion, hard-drive shipments of 59.9 million and net income of $416 million, or $1.71 per share. On a non-GAAP basis, net income was $477 million or $1.96 per share.2 In the year-ago quarter, the company reported revenue of $4.8 billion, net income of $745 million, or $2.87 per share, and shipped 71.0 million hard drives. Non-GAAP net income in the year-ago quarter was $872 million, or $3.35 per share.3  

The company generated $684 million in cash from operations during the June quarter, ending with total cash and cash equivalents of $4.3 billion. For fiscal year 2013, the company generated $3.1 billion in cash from operations and its free cash flow totaled $2.2 billion.4 During the quarter, the company utilized $235 million to buy back 4.4 million shares of common stock. On May 15, the company declared a $0.25 per common share dividend, which was paid on July 15.

"I am pleased with our performance in fiscal year 2013 and the June quarter, reflecting our expanding participation in the storage market, including the cloud and personal storage as we address the ongoing growth in digital data," said Steve Milligan, president and chief executive officer of Western Digital. "Our financial results were strong with significant free cash flow generation, we continued to forecast the market accurately and we had outstanding execution by our HGST and WD® subsidiaries."

The investment community conference call to discuss these results will be broadcast live over the Internet today at 2 p.m. Pacific/5 p.m. Eastern. The live and archived conference call webcast can be accessed online at investor.wdc.com. The telephone replay number is 800-873-2156 in the U.S. or +1-402-220-4765 for international callers.

As reported in our Form 8-K filed on July 22, 2013, the Court of Appeals of the State of Minnesota reversed the decision of the District Court of Hennepin County, Minnesota, which had vacated a $630.4 million final arbitration award against the company and ordered a rehearing of certain claims in the arbitration between Western Digital and Seagate Technology, LLC. The financial information reported in this press release does not include any additional accrual for the arbitration award. Western Digital is reviewing the decision of the Minnesota Court of Appeals and will make a determination of whether or not to record an accrual in its results for the quarter ended June 28, 2013, after it completes its review.

About Western Digital

Western Digital Corp. (NASDAQ: WDC), Irvine, Calif., is a global provider of products and services that empower people to create, manage, experience and preserve digital content. Its subsidiaries design and manufacture storage devices, networking equipment and home entertainment products under the WD, HGST and G-Technology brands. Visit the Investor section of the company's website (www.westerndigital.com) to access a variety of financial and investor information.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 concerning the company's market participation and growth of digital data. These forward-looking statements are based on management's current expectations and is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statement, including the impact of continued uncertainty and volatility in global economic conditions; supply and demand conditions in the hard drive industry; uncertainties concerning the availability and cost of commodity materials and specialized product components; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products based on new technologies and expansion into new data storage markets; business conditions and growth in the various hard drive markets; pricing trends and fluctuations in average selling prices; and other risks and uncertainties listed in the company's filings with the Securities and Exchange Commission (the "SEC"), including the company's recent Form 10-Q filed with the SEC on May 3, 2013, to which your attention is directed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speaks only as of the date hereof, and the company undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances.

Western Digital, WD and the WD logo are registered trademarks in the U.S. and other countries. HGST trademarks are intended and authorized for use only in countries and jurisdictions in which HGST has obtained the rights to use, market and advertise the brand. Other marks may be mentioned herein that belong to other companies.

___________________________

1Non-GAAP net income for fiscal 2013 consists of GAAP net income of $1.7 billion plus $193 million for amortization of intangibles related to the acquisition of HGST, $138 million for employee termination benefits and other charges and a net $106 million for tax-related matters and other unrelated charges. Non-GAAP earnings per share of $8.53 for fiscal 2013 is calculated by using the same 246 million diluted shares as is used for GAAP earnings per share. Non-GAAP net income for fiscal 2012 consists of GAAP net income of $1.6 billion plus $214 million of charges and expenses related to the flooding net of recoveries, $91 million for costs recognized upon the sale of acquired inventory that was written-up to fair value, $80 million related to restructuring, $63 million for amortization of intangibles related to the acquisition of HGST, $62 million of acquisition-related expenses, $7 million of litigation accruals, less $20 million of tax effects related to the aforementioned items. Non-GAAP earnings per share of $8.61 for fiscal 2012 is calculated by using the same 245 million diluted shares as is used for GAAP earnings per share.  

2Non-GAAP net income for the fourth quarter fiscal 2013 consists of GAAP net income of $416 million plus $46 million for amortization of intangibles related to the acquisition of HGST and $15 million for employee termination benefits and other unrelated charges. Non-GAAP earnings per share of $1.96 for the fourth quarter is calculated by using the same 243 million diluted shares as is used for GAAP earnings per share.

3 Non-GAAP net income for the fourth quarter fiscal 2012 consists of GAAP net income of $745 million plus $51 million for amortization of intangibles related to the acquisition of HGST, $80 million related to restructuring less a $4 million tax effect related to the restructuring. Non-GAAP earnings per share of $3.35 for the fourth quarter is calculated by using the same 260 million diluted shares as is used for GAAP earnings per share.

4 Free cash flow for fiscal 2013 consists of cash flows from operations of $3.1 billion less $952 million of capital expenditures. 

 



















WESTERN DIGITAL CORPORATION







CONDENSED CONSOLIDATED BALANCE SHEETS







(in millions; unaudited)










Jun. 28,


Jun. 29,




2013


2012







ASSETS


Current assets:





Cash and cash equivalents

$ 4,309


$ 3,208


Accounts receivable, net

1,793


2,364


Inventories

1,188


1,210


Other

308


359



Total current assets

7,598


7,141

Property, plant and equipment, net

3,700


4,067

Goodwill

1,954


1,975

Other intangible assets, net

605


799

Other assets

179


224



Total assets

$ 14,036


$ 14,206













LIABILITIES AND SHAREHOLDERS' EQUITY







Current liabilities:





Accounts payable

$ 1,990


$ 2,773


Accrued expenses

522


482


Accrued compensation

453


376


Accrued warranty

114


171


Current portion of long-term debt

230


230



Total current liabilities

3,309


4,032

Long-term debt

1,725


1,955

Other liabilities

428


550



Total liabilities

5,462


6,537

Total shareholders' equity

8,574


7,669



Total liabilities and shareholders' equity

$ 14,036


$ 14,206

    












WESTERN DIGITAL CORPORATION













CONDENSED CONSOLIDATED STATEMENTS OF INCOME













(in millions, except per share amounts)


(unaudited)




























Three Months Ended


Years Ended





Jun. 28,


Jun. 29,


Jun. 28,


Jun. 29,





2013


2012


2013


2012












Revenue, net


$ 3,728


$ 4,754


$ 15,351


$ 12,478

Cost of revenue


2,678


3,282


10,988


8,840


Gross profit


1,050


1,472


4,363


3,638

Operating expenses:










Research and development


402


406


1,572


1,055


Selling, general and administrative


180


178


706


518


Employee termination benefits and other charges


8


80


138


80


Charges related to flooding, net





214



Total operating expenses


590


664


2,416


1,867

Operating income


460


808


1,947


1,771


Net interest and other


(9)


(7)


(44)


(14)

Income before income taxes


451


801


1,903


1,757


Income tax provision


35


56


242


145

Net income


$ 416


$ 745


$ 1,661


$ 1,612












Income per common share:










Basic


$ 1.76


$ 2.93


$ 6.89


$ 6.69


Diluted


$ 1.71


$ 2.87


$ 6.75


$ 6.58












Weighted average shares outstanding:










Basic


236


254


241


241


Diluted


243


260


246


245


 

 

WESTERN DIGITAL CORPORATION











CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS











(in millions; unaudited)
























Three Months Ended


Year Ended




Jun. 28,


Jun. 29,


Jun. 28,


Jun. 29,




2013


2012


2013


2012











Cash flows from operating activities








Net income

$ 416


$ 745


$ 1,661


$ 1,612

Adjustments to reconcile net income to net cash








provided by operations:









Depreciation and amortization

302


339


1,233


825


Stock-based compensation

30


31


137


92


Deferred income taxes

(24)


(8)


35


34


Non-cash portion of employee termination benefits









and other charges

3


61


19


61


Non-cash portion of charges related to flooding




119


Changes in operating assets and liabilities, net

(43)


(40)


34


324



Net cash provided by operating activities

684


1,128


3,119


3,067











Cash flows from investing activities








Purchases of property, plant and equipment

(136)


(324)


(952)


(717)

Acquisitions, net


15


(1)


(3,526)

Purchase of investments



(17)


Proceeds from sale of equipment


76



76



Net cash used in investing activities

(136)


(233)


(970)


(4,167)











Cash flows from financing activities








Employee stock plans, net

53


93


205


141

Repurchases of common stock

(235)


(604)


(842)


(604)

Dividends to shareholders

(60)



(181)


Repayment of debt

(57)


(558)


(230)


(908)

Proceeds from debt, net of issuance costs




2,775

Repayment of assumed debt




(585)



Net cash provided by (used in) financing activities

(299)


(1,069)


(1,048)


819

Effect of exchange rate changes on cash


5



(1)

Net increase (decrease) in cash and cash equivalents

249


(169)


1,101


(282)

Cash and cash equivalents, beginning of period

4,060


3,377


3,208


3,490

Cash and cash equivalents, end of period

$ 4,309


$ 3,208


$ 4,309


$ 3,208











(Logo:  http://photos.prnewswire.com/prnh/20000711/WDCLOGO)

 

SOURCE Western Digital Corp.



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