StorageTek Announces Increased Revenue, Enhanced Margins And Improved Financial Performance for the First Quarter 2001

Apr 26, 2001, 01:00 ET from StorageTek

    LOUISVILLE, Colo., April 26 /PRNewswire/ -- StorageTek(R) (Storage
 Technology Corp.) (NYSE:   STK) today reported first quarter 2001 revenue of
 $468.8 million and a loss per share of $0.03 compared to first quarter 2000
 revenue of $459.7 million and a loss per share of $0.22 excluding
 restructuring and other one-time charges of $26.3 million.  A loss of
 $0.39 per share was reported in first quarter 2000 including restructuring and
 other one-time charges.  Gross margin for the first quarter 2001 was
 42 percent compared to 37 percent for the first quarter 2000, excluding
 restructuring and other one-time charges.  This margin increase reflects a
 favorable product mix and continued benefits from operational efficiencies.
     "We are very pleased with our successes this quarter.  In challenging
 times, customers have to make smarter and more deliberate decisions for their
 storage demands.  We believe that our superior technology and compelling
 business proposition is resonating with companies in all industries," said
 Patrick J. Martin, StorageTek chairman, president and chief executive officer.
 "In November, we outlined our strategy.  We said that we were going to
 concentrate on growing revenue profitably and unleashing trapped
 profitability.  We have set the foundation, are executing against our strategy
 and believe we are well positioned to successfully move forward."
     The company reports strong revenue growth in international operations of
 11 percent over first quarter 2000, with strong increases in Asia Pacific and
 Latin America of 30 percent and 19 percent, respectively.  "A strong
 international revenue base has successfully diversified our risks to economic
 downturns," said Martin.
     In the first quarter, Automated Tape Solutions revenue increased because
 of customers' preference for large libraries and the Company's virtual tape
 solution, the Virtual Storage Manager(TM) (VSM(TM)).  "We offer a compelling
 alternative for traditional disk users looking for a break in their ever
 increasing disk budget cycle.  You may hear others talking about virtual, but
 StorageTek is providing virtual," Martin said.
     Financial highlights for the first quarter include a strong cash balance
 of $292 million and cash flow from operations of approximately $60 million.
 Debt was reduced for the eighth straight quarter.  "Our balance sheet is
 strong.  The effective use of our working capital and the continued drive to
 unleash trapped profitability provides a solid foundation for us in times when
 many business sectors are under economic pressures.  We will hold the line on
 discretionary expenses, but continue to invest in those areas that can
 generate profitable revenue growth," said Robert Kocol, StorageTek's chief
 financial officer.
 
     StorageTek will conduct a conference call today at 5:00 p.m. EDT.  Please
 join us for a live audio webcast at
 http://storagetek.shareholder.com/medialist2.cfm?companyid=STK.  If you prefer
 to join via telephone line, please dial 800-289-0496 at least 5 minutes prior
 to the start of the call.
     The earnings conference call replay may be accessed on StorageTek's web
 site at http://storagetek.shareholder.com/medialist2.cfm?companyid=stk or by
 dialing 888-203-1112 using pass code 761626.
 
     The assumptions, expectations and forecasts contained herein regarding
 StorageTek's future plans, financial results and performance may constitute
 "forward looking statements" within the meaning of the Private Securities
 Litigation Reform Act of 1995.  These statements involve a number of risks and
 uncertainties that could cause actual results to differ materially.  Some of
 these risks and uncertainties include, without limitation, the timely
 introduction, manufacture and market acceptance of products; successfully
 containing operating expense levels while increasing revenue; managing
 aggressive competition and pricing pressures on the Company's products and
 services; developing new distribution channels for the Company's products and
 services; and other risks that are discussed in StorageTek's reports on Forms
 10-K, 10-Q and 8-K that are filed with the Securities and Exchange Commission
 (SEC) and which are available on the Internet.
 
     About StorageTek
     StorageTek (NYSE:   STK), a $2 billion worldwide company with headquarters
 in Louisville, Colo., delivers a broad range of storage solutions for
 digitized data.  StorageTek solutions are easy to manage and allow universal
 access to data across servers, media types and storage networks.  StorageTek
 is the innovator and global leader in virtual storage solutions for tape
 automation, disk storage systems and storage networking.  Because of
 StorageTek, customers can manage and leverage their digital assets as their
 businesses grow and can maximize IT productivity to ensure enterprise-class
 business continuity.  For more information, see www.storagetek.com, or call
 1.800.786.7835.
 
     TRADEMARKS: StorageTek is a registered trademark of Storage Technology
 Corp.  All other products or company names mentioned are used for
 identification purposes only, and may be trademarks of their respective
 owners.
 
 
                         STORAGE TECHNOLOGY CORPORATION
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                  (Unaudited)
                    (In Thousands, Except Per Share Amounts)
 
                                                      Quarter Ended
                                               03/30/01          03/31/00
     Revenue
       Storage products                         $305,360         $301,112
         Gross profit margin                          43%              35%
 
       Storage services                          163,459            158,557
         Gross profit margin                          40%               32%
 
         Total revenue                           468,819          459,669
 
     Cost of revenue                             271,549          305,116
 
         Gross profit                            197,270          154,553
         Gross profit margin                          42%              34%
 
     Research and product development costs       64,194           65,180
     Selling, general, administrative and
      other income and expense, net              138,243          134,120
     Restructuring                                    --           11,442
 
         Operating loss                           (5,167)         (56,189)
 
     Interest expense                             (1,635)          (6,325)
     Interest income                               2,248            1,676
 
         Loss before income taxes                 (4,554)         (60,838)
 
     Benefit for income taxes                      1,550           21,300
 
         Net loss                               $ (3,004)        $(39,538)
 
 
     LOSS PER COMMON SHARE
 
     Basic loss per share                       $  (0.03)        $  (0.39)
 
     Weighted-average shares                     102,274          100,387
 
 
     Diluted loss per share                     $  (0.03)        $  (0.39)
 
     Weighted-average and dilutive
      potential shares                           102,274          100,387
 
 
            SUPPLEMENTARY FINANCIAL DATA - STORAGE PRODUCTS REVENUE
 
       Tape products                       $247,437            $233,668
       Disk products                         25,956              31,828
       Network and other products            31,967              35,616
         Total products                    $305,360            $301,112
 
 
                         STORAGE TECHNOLOGY CORPORATION
                           CONSOLIDATED BALANCE SHEET
                           (In Thousands of Dollars)
 
                                          03/30/01
                                         (Unaudited)           12/29/00
     ASSETS
     Current assets:
       Cash and cash equivalents         $  292,119          $  279,731
       Accounts receivable                  437,653             553,790
       Inventories                          248,416             218,218
       Deferred income tax assets           121,197             121,703
       Other current assets                  21,034                  --
 
         Total current assets             1,120,419           1,173,442
 
     Property, plant and equipment, net     259,462             267,082
     Spare parts for maintenance, net        39,029              41,614
     Deferred income tax assets              74,282              73,997
     Other assets                            97,838              97,423
 
         Total assets                    $1,591,030          $1,653,558
 
 
     LIABILITIES
     Current liabilities:
       Credit facilities                 $   60,281          $   78,381
       Current portion of long-term debt         38               6,110
       Accounts payable                      87,045              99,675
       Accrued liabilities                  332,044             363,048
       Income taxes payable                 155,962             155,626
 
         Total current liabilities          635,370             702,840
 
     Long-term debt                          10,872              12,083
 
         Total liabilities                  646,242             714,923
 
 
     STOCKHOLDERS' EQUITY
     Common stock, $.10 par value            10,317              10,320
     Capital in excess of par value         854,674             854,744
     Retained earnings                       79,918              82,922
     Accumulated other comprehensive income   8,695                  --
     Treasury stock                          (2,938)             (2,334)
     Unearned compensation                   (5,878)             (7,017)
 
         Total stockholders' equity         944,788             938,635
 
         Total liabilities and
          stockholders' equity           $1,591,030          $1,653,558
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X82952428
 
 

SOURCE StorageTek
    LOUISVILLE, Colo., April 26 /PRNewswire/ -- StorageTek(R) (Storage
 Technology Corp.) (NYSE:   STK) today reported first quarter 2001 revenue of
 $468.8 million and a loss per share of $0.03 compared to first quarter 2000
 revenue of $459.7 million and a loss per share of $0.22 excluding
 restructuring and other one-time charges of $26.3 million.  A loss of
 $0.39 per share was reported in first quarter 2000 including restructuring and
 other one-time charges.  Gross margin for the first quarter 2001 was
 42 percent compared to 37 percent for the first quarter 2000, excluding
 restructuring and other one-time charges.  This margin increase reflects a
 favorable product mix and continued benefits from operational efficiencies.
     "We are very pleased with our successes this quarter.  In challenging
 times, customers have to make smarter and more deliberate decisions for their
 storage demands.  We believe that our superior technology and compelling
 business proposition is resonating with companies in all industries," said
 Patrick J. Martin, StorageTek chairman, president and chief executive officer.
 "In November, we outlined our strategy.  We said that we were going to
 concentrate on growing revenue profitably and unleashing trapped
 profitability.  We have set the foundation, are executing against our strategy
 and believe we are well positioned to successfully move forward."
     The company reports strong revenue growth in international operations of
 11 percent over first quarter 2000, with strong increases in Asia Pacific and
 Latin America of 30 percent and 19 percent, respectively.  "A strong
 international revenue base has successfully diversified our risks to economic
 downturns," said Martin.
     In the first quarter, Automated Tape Solutions revenue increased because
 of customers' preference for large libraries and the Company's virtual tape
 solution, the Virtual Storage Manager(TM) (VSM(TM)).  "We offer a compelling
 alternative for traditional disk users looking for a break in their ever
 increasing disk budget cycle.  You may hear others talking about virtual, but
 StorageTek is providing virtual," Martin said.
     Financial highlights for the first quarter include a strong cash balance
 of $292 million and cash flow from operations of approximately $60 million.
 Debt was reduced for the eighth straight quarter.  "Our balance sheet is
 strong.  The effective use of our working capital and the continued drive to
 unleash trapped profitability provides a solid foundation for us in times when
 many business sectors are under economic pressures.  We will hold the line on
 discretionary expenses, but continue to invest in those areas that can
 generate profitable revenue growth," said Robert Kocol, StorageTek's chief
 financial officer.
 
     StorageTek will conduct a conference call today at 5:00 p.m. EDT.  Please
 join us for a live audio webcast at
 http://storagetek.shareholder.com/medialist2.cfm?companyid=STK.  If you prefer
 to join via telephone line, please dial 800-289-0496 at least 5 minutes prior
 to the start of the call.
     The earnings conference call replay may be accessed on StorageTek's web
 site at http://storagetek.shareholder.com/medialist2.cfm?companyid=stk or by
 dialing 888-203-1112 using pass code 761626.
 
     The assumptions, expectations and forecasts contained herein regarding
 StorageTek's future plans, financial results and performance may constitute
 "forward looking statements" within the meaning of the Private Securities
 Litigation Reform Act of 1995.  These statements involve a number of risks and
 uncertainties that could cause actual results to differ materially.  Some of
 these risks and uncertainties include, without limitation, the timely
 introduction, manufacture and market acceptance of products; successfully
 containing operating expense levels while increasing revenue; managing
 aggressive competition and pricing pressures on the Company's products and
 services; developing new distribution channels for the Company's products and
 services; and other risks that are discussed in StorageTek's reports on Forms
 10-K, 10-Q and 8-K that are filed with the Securities and Exchange Commission
 (SEC) and which are available on the Internet.
 
     About StorageTek
     StorageTek (NYSE:   STK), a $2 billion worldwide company with headquarters
 in Louisville, Colo., delivers a broad range of storage solutions for
 digitized data.  StorageTek solutions are easy to manage and allow universal
 access to data across servers, media types and storage networks.  StorageTek
 is the innovator and global leader in virtual storage solutions for tape
 automation, disk storage systems and storage networking.  Because of
 StorageTek, customers can manage and leverage their digital assets as their
 businesses grow and can maximize IT productivity to ensure enterprise-class
 business continuity.  For more information, see www.storagetek.com, or call
 1.800.786.7835.
 
     TRADEMARKS: StorageTek is a registered trademark of Storage Technology
 Corp.  All other products or company names mentioned are used for
 identification purposes only, and may be trademarks of their respective
 owners.
 
 
                         STORAGE TECHNOLOGY CORPORATION
                      CONSOLIDATED STATEMENT OF OPERATIONS
                                  (Unaudited)
                    (In Thousands, Except Per Share Amounts)
 
                                                      Quarter Ended
                                               03/30/01          03/31/00
     Revenue
       Storage products                         $305,360         $301,112
         Gross profit margin                          43%              35%
 
       Storage services                          163,459            158,557
         Gross profit margin                          40%               32%
 
         Total revenue                           468,819          459,669
 
     Cost of revenue                             271,549          305,116
 
         Gross profit                            197,270          154,553
         Gross profit margin                          42%              34%
 
     Research and product development costs       64,194           65,180
     Selling, general, administrative and
      other income and expense, net              138,243          134,120
     Restructuring                                    --           11,442
 
         Operating loss                           (5,167)         (56,189)
 
     Interest expense                             (1,635)          (6,325)
     Interest income                               2,248            1,676
 
         Loss before income taxes                 (4,554)         (60,838)
 
     Benefit for income taxes                      1,550           21,300
 
         Net loss                               $ (3,004)        $(39,538)
 
 
     LOSS PER COMMON SHARE
 
     Basic loss per share                       $  (0.03)        $  (0.39)
 
     Weighted-average shares                     102,274          100,387
 
 
     Diluted loss per share                     $  (0.03)        $  (0.39)
 
     Weighted-average and dilutive
      potential shares                           102,274          100,387
 
 
            SUPPLEMENTARY FINANCIAL DATA - STORAGE PRODUCTS REVENUE
 
       Tape products                       $247,437            $233,668
       Disk products                         25,956              31,828
       Network and other products            31,967              35,616
         Total products                    $305,360            $301,112
 
 
                         STORAGE TECHNOLOGY CORPORATION
                           CONSOLIDATED BALANCE SHEET
                           (In Thousands of Dollars)
 
                                          03/30/01
                                         (Unaudited)           12/29/00
     ASSETS
     Current assets:
       Cash and cash equivalents         $  292,119          $  279,731
       Accounts receivable                  437,653             553,790
       Inventories                          248,416             218,218
       Deferred income tax assets           121,197             121,703
       Other current assets                  21,034                  --
 
         Total current assets             1,120,419           1,173,442
 
     Property, plant and equipment, net     259,462             267,082
     Spare parts for maintenance, net        39,029              41,614
     Deferred income tax assets              74,282              73,997
     Other assets                            97,838              97,423
 
         Total assets                    $1,591,030          $1,653,558
 
 
     LIABILITIES
     Current liabilities:
       Credit facilities                 $   60,281          $   78,381
       Current portion of long-term debt         38               6,110
       Accounts payable                      87,045              99,675
       Accrued liabilities                  332,044             363,048
       Income taxes payable                 155,962             155,626
 
         Total current liabilities          635,370             702,840
 
     Long-term debt                          10,872              12,083
 
         Total liabilities                  646,242             714,923
 
 
     STOCKHOLDERS' EQUITY
     Common stock, $.10 par value            10,317              10,320
     Capital in excess of par value         854,674             854,744
     Retained earnings                       79,918              82,922
     Accumulated other comprehensive income   8,695                  --
     Treasury stock                          (2,938)             (2,334)
     Unearned compensation                   (5,878)             (7,017)
 
         Total stockholders' equity         944,788             938,635
 
         Total liabilities and
          stockholders' equity           $1,591,030          $1,653,558
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X82952428
 
 SOURCE  StorageTek