Bell Microproducts Reports First Quarter Financial Results
Apr 18, 2001, 01:00 ET from Bell Microproducts Inc.
SAN JOSE, Calif., April 18 /PRNewswire/ -- Bell Microproducts Inc.
(Nasdaq: BELM) today announced its financial results for the first quarter
ended March 31, 2001.
Revenues for the first quarter were $535.5 million, up 46% from
$366.3 million in the first quarter of 2000, and down 2% from $544.4 million
in the fourth quarter of 2000. Net income in the first quarter of 2001 was
$126,000, compared with net income of $3.2 million in the first quarter of
2000 and net income of $5.2 million in the fourth quarter of 2000. First
quarter 2001 diluted earnings per share were $0.01 on 17.4 million shares,
compared with diluted earnings per share of $0.21 on 15.0 million shares in
the first quarter of 2000 and diluted earnings per share of $0.30 on
17.7 million shares in the fourth quarter of 2000. Book value was $8.13 per
primary share at the end of the quarter.
"I am disappointed to report that our track record of improving sales and
earnings over seven consecutive quarters, which culminated in a record fourth
quarter of 2000, was interrupted during the first quarter of 2001," said Don
Bell, Bell Microproducts' president and chief executive officer. "First
quarter 2001 financial results were impacted by the well-publicized slump in
the technology markets," added Bell.
Operating Trends
"In our fourth quarter 2000 earnings press release in early February, we
discussed the softening demand in the market for electronic components in
North America," said Bell. "The market has continued to weaken as demand for
our North American customers has decreased, resulting in our customers being
over-inventoried in some commodity products," added Bell. "Latin American and
European sales have not been impacted at this time and were up sequentially in
the quarter," further said Bell.
While first quarter sales were down only 2% from the fourth quarter of
2000, profits were more heavily impacted. This was due to a decline in gross
profit margin, higher SG&A expenses, and higher interest charges.
Gross profit margin was 8.5% in the first quarter of 2001, up from 8.0% in
the first quarter of 2000 but down from 9.7% in the fourth quarter of 2000.
This was primarily due to lower sales in the higher margin industrial OEM
market in the U.S., and lower margins in the Americas for computer components
such as disk drives.
Expenses were essentially flat with the fourth quarter of 2000, but were
up significantly from a year ago as a result of the acquisitions in 2000 of
Ideal and Rorke, and the investment in strategic programs. Expenses in the
first quarter 2001 include the cost of opening sales offices in four European
countries, as well as increased staffing at our new Corporate Technology
Center located in Montgomery, Alabama. "The new locations in Europe form the
basis for a significantly increased revenue and profit opportunity," said
Bell. Commenting on the new Corporate Technology Center, Mr. Bell added,
"Longer-term, we expect the Center to yield economies of scale that should
result in productivity and cost benefits." With the slowdown in sales during
the quarter, selling, general & administrative expenses as a percentage of
sales were 7.4% in the quarter, compared to 5.8% in the first quarter of 2000,
and 7.3% in the fourth quarter of 2000. As the scope of the downturn in the
North American technology markets became apparent during the quarter, the
Company took several cost containment measures in order to bring costs more in
line with the reduced revenue levels.
Interest expenses were higher compared to the fourth quarter of 2000 as a
result of higher inventory levels earlier in the quarter. Inventories have
since been reduced significantly, from $247 million at December 31, 2000 to
$217 million at March 31, 2001, which if maintained, should lead to lower
interest expenses in the second quarter. Inventory turns increased from
8.0 in the fourth quarter of 2000 to 9.0 in the first quarter of 2001, and
days sales outstanding increased slightly from 49 days to 50 days. "We are
pleased that we were able to reduce inventories during a time of excess
inventories throughout our industry," said Bell.
Business Outlook
"We are optimistic with regard to our strategic initiatives, and we
believe that our strengthened management team, our expanding line card, our
increased geographic coverage, and our thrust in storage systems and solutions
will serve us well in the future," commented Bell. "At this time, it is
difficult to make predictions for the balance of 2001. Our customers are
experiencing soft demand for their products, and most have excess inventories
that are currently being worked off. As we take actions to contain costs, and
as our strategic initiatives begin yielding results, we expect to offset some
the market pressures on our revenues and gross margins," added Bell.
"We believe the secular strong growth in digital content should fuel
renewed strong demand for storage and semiconductor. We also believe that we
will continue to outperform industry growth rates, although, obviously, no
assurances can be given in this regard," concluded Bell.
Conference Call on the Web.
At 11:00 a.m. EDT Wednesday, April 18, 2001, a live Internet broadcast of
the Company's fourth quarter earnings conference call will be available via
the Company's web site at www.bellmicro.com or through this direct link
http://www.bellmicro.com/Investor/information/Conference_Calls.htm.
About Bell Microproducts
Bell Microproducts is an international, value-added provider of a wide
range of high-technology products, solutions, and services to the industrial
and commercial markets. The company's offering includes semiconductors,
computer platforms, peripherals, and storage products of various types
including desktop, high-end computer and storage subsystems, fibre channel
connectivity products, RAID, NAS and SAN storage systems and back-up products.
Bell Microproducts is an industry-recognized specialist in storage products
and is one of the world's largest storage-centric value-added distributors.
The company's products are available at any level of integration, from
components to subsystem assemblies and fully-integrated, tested and certified
system solutions. The company adds value with a broad range of services
including testing, software loading, kitting, mass storage system integration,
and computer system integration. Trained and certified technical personnel
complete each of these processes at Bell Microproducts' ISO 9002 facilities.
Bell Microproducts markets and distributes more than 150 brand name product
lines, as well as its own BellStor storage and Trademark(R) computer brands,
to original equipment manufacturers (OEMs), contract electronic manufacturing
services (EMS) customers, value-added resellers (VARs) and system integrators
in the Americas and Europe. More information can be found in the company's
SEC filings, or by visiting the Bell Microproducts Web site at
www.bellmicro.com.
Safe Harbor Statement.
This release may contain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, which reflect the Company's current views of future events and
financial performance, involve known and unknown risks and uncertainties which
could cause actual results or facts to differ materially from such statements
for a variety of reasons including, but not limited to: the ability to
successfully integrate the operations of recent acquisitions, industry
conditions, changes in product supply, pricing, and customer demand,
competition, other vagaries in the computer and electronic components markets,
changes in relationships with key suppliers, foreign currency fluctuations and
the other risks described from time to time in the Company's reports to the
Securities and Exchange Commission (including the company's Annual Report on
Form 10-K). Investors should take such risks into account when making
investment decisions. Shareholders and other readers are cautioned not to
place undue reliance on these forward-looking statements, which speak only as
of the date on which they are made. The company undertakes no obligation to
update publicly or revise any forward-looking statements.
BELL MICROPRODUCTS INC.
Balance Sheets
(in thousands)
(unaudited)
March 31, 2001Dec. 31, 2000
ASSETS
Current assets:
Cash $5,043 $7,465
Accounts receivable, net 299,654 295,572
Inventories 216,756 246,671
Prepaid expenses and other current assets 11,709 11,906
Total current assets 533,162 561,614
Property and equipment, net 44,641 44,436
Goodwill and other intangibles 45,946 46,439
Other assets 8,583 8,718
Total assets $632,332 $ 661,207
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $211,708 $ 231,132
Borrowings under the line of credit 52,713 52,633
Short-term note payable
and current portion of
long-term notes payable 89,046 90,500
Other accrued liabilities 44,299 50,539
Total current liabilities 397,766 424,804
Borrowings under the line of credit 320 249
Long-term notes payable 99,798 101,640
Other long-term liabilities 5,635 4,982
Total liabilities 503,519 531,675
Shareholders' equity:
Common Stock 75,661 75,154
Retained earnings 54,598 54,472
Cumulative translation adjustment (1,446) (94)
Total shareholders' equity 128,813 129,532
Total liabilities
and shareholders' equity $632,332 $ 661,207
BELL MICROPRODUCTS INC.
Statements of Income
(in thousands, except per share data)
(unaudited)
Three months ended March 31,
2001 2000
Net sales $535,523 $366,270
Cost of sales 490,101 337,012
Gross profit 45,422 29,258
Selling, general and administrative expenses 39,626 21,355
Income from operations 5,796 7,903
Interest expense (5,579) (2,369)
Income before income taxes 217 5,534
Provision for income taxes 91 2,324
Net income $126 $3,210
Earnings per share
Basic $0.01 $0.23
Diluted $0.01 $0.21
Shares used in per share calculation
Basic 15,842 13,964
Diluted 17,417 14,981
SOURCE Bell Microproducts Inc.
SAN JOSE, Calif., April 18 /PRNewswire/ -- Bell Microproducts Inc.
(Nasdaq: BELM) today announced its financial results for the first quarter
ended March 31, 2001.
Revenues for the first quarter were $535.5 million, up 46% from
$366.3 million in the first quarter of 2000, and down 2% from $544.4 million
in the fourth quarter of 2000. Net income in the first quarter of 2001 was
$126,000, compared with net income of $3.2 million in the first quarter of
2000 and net income of $5.2 million in the fourth quarter of 2000. First
quarter 2001 diluted earnings per share were $0.01 on 17.4 million shares,
compared with diluted earnings per share of $0.21 on 15.0 million shares in
the first quarter of 2000 and diluted earnings per share of $0.30 on
17.7 million shares in the fourth quarter of 2000. Book value was $8.13 per
primary share at the end of the quarter.
"I am disappointed to report that our track record of improving sales and
earnings over seven consecutive quarters, which culminated in a record fourth
quarter of 2000, was interrupted during the first quarter of 2001," said Don
Bell, Bell Microproducts' president and chief executive officer. "First
quarter 2001 financial results were impacted by the well-publicized slump in
the technology markets," added Bell.
Operating Trends
"In our fourth quarter 2000 earnings press release in early February, we
discussed the softening demand in the market for electronic components in
North America," said Bell. "The market has continued to weaken as demand for
our North American customers has decreased, resulting in our customers being
over-inventoried in some commodity products," added Bell. "Latin American and
European sales have not been impacted at this time and were up sequentially in
the quarter," further said Bell.
While first quarter sales were down only 2% from the fourth quarter of
2000, profits were more heavily impacted. This was due to a decline in gross
profit margin, higher SG&A expenses, and higher interest charges.
Gross profit margin was 8.5% in the first quarter of 2001, up from 8.0% in
the first quarter of 2000 but down from 9.7% in the fourth quarter of 2000.
This was primarily due to lower sales in the higher margin industrial OEM
market in the U.S., and lower margins in the Americas for computer components
such as disk drives.
Expenses were essentially flat with the fourth quarter of 2000, but were
up significantly from a year ago as a result of the acquisitions in 2000 of
Ideal and Rorke, and the investment in strategic programs. Expenses in the
first quarter 2001 include the cost of opening sales offices in four European
countries, as well as increased staffing at our new Corporate Technology
Center located in Montgomery, Alabama. "The new locations in Europe form the
basis for a significantly increased revenue and profit opportunity," said
Bell. Commenting on the new Corporate Technology Center, Mr. Bell added,
"Longer-term, we expect the Center to yield economies of scale that should
result in productivity and cost benefits." With the slowdown in sales during
the quarter, selling, general & administrative expenses as a percentage of
sales were 7.4% in the quarter, compared to 5.8% in the first quarter of 2000,
and 7.3% in the fourth quarter of 2000. As the scope of the downturn in the
North American technology markets became apparent during the quarter, the
Company took several cost containment measures in order to bring costs more in
line with the reduced revenue levels.
Interest expenses were higher compared to the fourth quarter of 2000 as a
result of higher inventory levels earlier in the quarter. Inventories have
since been reduced significantly, from $247 million at December 31, 2000 to
$217 million at March 31, 2001, which if maintained, should lead to lower
interest expenses in the second quarter. Inventory turns increased from
8.0 in the fourth quarter of 2000 to 9.0 in the first quarter of 2001, and
days sales outstanding increased slightly from 49 days to 50 days. "We are
pleased that we were able to reduce inventories during a time of excess
inventories throughout our industry," said Bell.
Business Outlook
"We are optimistic with regard to our strategic initiatives, and we
believe that our strengthened management team, our expanding line card, our
increased geographic coverage, and our thrust in storage systems and solutions
will serve us well in the future," commented Bell. "At this time, it is
difficult to make predictions for the balance of 2001. Our customers are
experiencing soft demand for their products, and most have excess inventories
that are currently being worked off. As we take actions to contain costs, and
as our strategic initiatives begin yielding results, we expect to offset some
the market pressures on our revenues and gross margins," added Bell.
"We believe the secular strong growth in digital content should fuel
renewed strong demand for storage and semiconductor. We also believe that we
will continue to outperform industry growth rates, although, obviously, no
assurances can be given in this regard," concluded Bell.
Conference Call on the Web.
At 11:00 a.m. EDT Wednesday, April 18, 2001, a live Internet broadcast of
the Company's fourth quarter earnings conference call will be available via
the Company's web site at www.bellmicro.com or through this direct link
http://www.bellmicro.com/Investor/information/Conference_Calls.htm.
About Bell Microproducts
Bell Microproducts is an international, value-added provider of a wide
range of high-technology products, solutions, and services to the industrial
and commercial markets. The company's offering includes semiconductors,
computer platforms, peripherals, and storage products of various types
including desktop, high-end computer and storage subsystems, fibre channel
connectivity products, RAID, NAS and SAN storage systems and back-up products.
Bell Microproducts is an industry-recognized specialist in storage products
and is one of the world's largest storage-centric value-added distributors.
The company's products are available at any level of integration, from
components to subsystem assemblies and fully-integrated, tested and certified
system solutions. The company adds value with a broad range of services
including testing, software loading, kitting, mass storage system integration,
and computer system integration. Trained and certified technical personnel
complete each of these processes at Bell Microproducts' ISO 9002 facilities.
Bell Microproducts markets and distributes more than 150 brand name product
lines, as well as its own BellStor storage and Trademark(R) computer brands,
to original equipment manufacturers (OEMs), contract electronic manufacturing
services (EMS) customers, value-added resellers (VARs) and system integrators
in the Americas and Europe. More information can be found in the company's
SEC filings, or by visiting the Bell Microproducts Web site at
www.bellmicro.com.
Safe Harbor Statement.
This release may contain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Such forward-looking
statements, which reflect the Company's current views of future events and
financial performance, involve known and unknown risks and uncertainties which
could cause actual results or facts to differ materially from such statements
for a variety of reasons including, but not limited to: the ability to
successfully integrate the operations of recent acquisitions, industry
conditions, changes in product supply, pricing, and customer demand,
competition, other vagaries in the computer and electronic components markets,
changes in relationships with key suppliers, foreign currency fluctuations and
the other risks described from time to time in the Company's reports to the
Securities and Exchange Commission (including the company's Annual Report on
Form 10-K). Investors should take such risks into account when making
investment decisions. Shareholders and other readers are cautioned not to
place undue reliance on these forward-looking statements, which speak only as
of the date on which they are made. The company undertakes no obligation to
update publicly or revise any forward-looking statements.
BELL MICROPRODUCTS INC.
Balance Sheets
(in thousands)
(unaudited)
March 31, 2001Dec. 31, 2000
ASSETS
Current assets:
Cash $5,043 $7,465
Accounts receivable, net 299,654 295,572
Inventories 216,756 246,671
Prepaid expenses and other current assets 11,709 11,906
Total current assets 533,162 561,614
Property and equipment, net 44,641 44,436
Goodwill and other intangibles 45,946 46,439
Other assets 8,583 8,718
Total assets $632,332 $ 661,207
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $211,708 $ 231,132
Borrowings under the line of credit 52,713 52,633
Short-term note payable
and current portion of
long-term notes payable 89,046 90,500
Other accrued liabilities 44,299 50,539
Total current liabilities 397,766 424,804
Borrowings under the line of credit 320 249
Long-term notes payable 99,798 101,640
Other long-term liabilities 5,635 4,982
Total liabilities 503,519 531,675
Shareholders' equity:
Common Stock 75,661 75,154
Retained earnings 54,598 54,472
Cumulative translation adjustment (1,446) (94)
Total shareholders' equity 128,813 129,532
Total liabilities
and shareholders' equity $632,332 $ 661,207
BELL MICROPRODUCTS INC.
Statements of Income
(in thousands, except per share data)
(unaudited)
Three months ended March 31,
2001 2000
Net sales $535,523 $366,270
Cost of sales 490,101 337,012
Gross profit 45,422 29,258
Selling, general and administrative expenses 39,626 21,355
Income from operations 5,796 7,903
Interest expense (5,579) (2,369)
Income before income taxes 217 5,534
Provision for income taxes 91 2,324
Net income $126 $3,210
Earnings per share
Basic $0.01 $0.23
Diluted $0.01 $0.21
Shares used in per share calculation
Basic 15,842 13,964
Diluted 17,417 14,981
SOURCE Bell Microproducts Inc.
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