SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 7, 1996
QUANTUM CORPORATION
(Exact name of registrant as specified in its charter)
DELAWARE
(State or other jurisdiction of incorporation)
0-12390
(Commission File No.)
94-2665054
(IRS Employer Identification No.)
500 McCarthy Boulevard
Milpitas, CA 95035
(Address of principal executive offices and zip code)
(408) 894-4000
(Registrant's telephone number, including area code)
<PAGE>
ITEM 5. OTHER EVENTS
The information which is set forth in the Registrant's News Release
dated May 7, 1996 is incorporated herein by reference.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits
99.3 Text of Press Release dated May 7, 1996.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
QUANTUM CORPORATION
Date: May 8, 1996 By: /s/ Joseph T. Rodgers
---------------------
Joseph T. Rodgers
Executive Vice President, Finance
and Chief Financial Officer
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INDEX TO EXHIBITS
Sequentially
Numbered
Exhibit Description Page
99.3 Text of Press Release dated
May 7, 1996 5
EXHIBIT 99.3
FOR RELEASE: May 7, 1996, 2:15 PM, PDT Contact: Catherine Hartsog,
Communications
(408) 894-4334
Ed McClammy,
Finance
(408) 894-5703
QUANTUM ANNOUNCES RESULTS FOR FOURTH FISCAL 1996 QUARTER
Sales for 1996 Fiscal Year of $4.4 Billion
MILPITAS, Calif., May 7, 1996 -- Quantum Corporation (NMS:
QNTM), today announced record sales of $1.2 billion for its fourth fiscal 1996
quarter, ended March 31, 1996. Net income was $21 million or 35 cents per share
fully diluted, before a non-recurring charge of $209 million, pre-tax,
associated with a restructuring of the company's high-capacity business
announced in January. This restructuring includes closing manufacturing
facilities in Milpitas, Calif. and Penang, Malaysia; and transitioning
manufacturing of the company's high-capacity hard disk drives to
Matsushita-Kotobuki Electronics Industries, Ltd. (MKE), Quantum's long-time
manufacturing partner for desktop drives. Including this one-time charge, the
company had a net loss of $123 million or $2.28 per share fully diluted.
For the 1996 fiscal year, Quantum's net income excluding unusual
charges was $77 million or $1.32 per share fully diluted on sales of $4.4
billion. Including unusual charges related to the resizing of the company's
high-capacity business and the new manufacturing model, the net loss was $90
million or $1.74 per share for the year.
"The strength of customer demand for Quantum's desktop drives and our
DLT(TM) tape drives during the quarter was very impressive," said Michael A.
Brown, Quantum's chief executive officer. "We shipped over 5.7 million desktop
drives, again leading the industry in that market. We believe we currently have
both a time-to-volume lead in our desktop product line and the strongest
customer base in the industry."
Quantum's five largest OEM customers accounted for 43 percent of the
company's sales in the fourth quarter. Compaq was the company's largest customer
at 13% of sales; IBM represented 10% of Quantum's sales for the quarter.
During the fourth quarter, Quantum announced and began shipping its
Bigfoot(TM) products, 1.2- and 2.5-gigabyte drives in the 5.25-inch form factor.
"Our Bigfoot drives are the highest value solution for the capacity-hungry
consumer personal computer marketplace," said Brown. "We are pleased with the
customer acceptance of these products and are shipping or qualifying the Bigfoot
products at 7 of the 10 largest personal computer OEMs."
Quantum's DLT tape drive business accounted for nearly ten percent of
its sales for the quarter. "We continue to be pleased with our success in
growing our DLT tapes business and the emergence of DLT tape as an industry
standard," said Brown. "Based on our fourth quarter sales, Quantum is now the
second largest tape drive supplier in the world.
"The high-end market continues to be an exciting opportunity, " said
Brown. "We are confident that expanding our relationship with MKE to our
high-end business is the right model for Quantum, and although we face
significant challenges during the transition, the benefits of this strategy
should be apparent this fiscal year. If we are successful in delivering the
quality, consistency and ramp capability in our high-capacity disk drives we
believe we can achieve through our partnership with MKE, we will have the
opportunity to offer a significant, competitive advantage in the high-end
marketplace."
Founded in 1980, Quantum Corporation designs and manufactures storage
products for today's digitized world. Widely recognized as the industry's
quality leader, Quantum sells a broad range of storage products to OEM and
distribution customers worldwide. The company's sales for the fiscal year ending
March 1996 were $4.4 billion. Quantum's World Wide Web home page address is
http://www.quantum.com.
This release contains forward-looking statements based on current
expectations. Actual results could differ materially as a result of several
factors including those related to the change in the high-end manufacturing
strategy. See the risk factors as outlined in Quantum's fiscal year 1995 10K and
10Q for the quarter ended December 31, 1995.
###
Bigfoot and DLT are the trademarks of Quantum Corporation
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QUANTUM CORPORATION
CONSOLIDATED BALANCE SHEETS
( In thousands )
March 31, March 31,
1996 1995
---------- ----------
Assets
Current Assets:
Cash and investments $ 164,752 $ 187,753
Accounts receivable, net of allowance for
doubtful accounts of $10,497 and $11,963 711,107 497,887
Inventories 459,538 324,650
Deferred income taxes 109,625 44,054
Other current assets 81,472 35,580
---------- ----------
Total current assets 1,526,494 1,089,924
Property and equipment, net 364,111 280,099
Purchased intangibles, net 66,313 95,818
Other assets 18,437 15,187
---------- ----------
$1,975,355 $1,481,028
========== ==========
Liabilities and Shareholders' Equity
Current Liabilities:
Accounts payable $ 498,829 $ 355,117
Accrued warranty 62,289 57,001
Other accrued liabilities 152,734 181,923
Accrued restructuring costs 103,165 --
Short term debt 4,125 50,000
---------- ----------
Total current liabilities 821,142 644,041
Deferred income taxes 11,232 --
Subordinated debt 374,283 212,500
Long term debt 223,875 115,000
Shareholders' equity 544,823 509,487
---------- ----------
$1,975,355 $1,481,028
========== ==========
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QUANTUM CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
( In thousands except per share amounts )
<TABLE>
<S> <C> <C> <C> <C>
THREE MONTHS ENDED TWELVE MONTHS ENDED
March 31, March 31, March 31, March 31,
1996 1995 1996 1995
Sales $ 1,232,491 $ 983,809 $ 4,422,726 $ 3,367,984
Cost of sales 1,070,943 834,158 3,880,309 2,804,271
----------- ----------- ----------- -----------
Gross profit 161,548 149,651 542,417 563,713
----------- ----------- ----------- -----------
Expenses:
Research and development 65,177 58,124 239,116 169,282
Sales and marketing 36,697 34,069 142,413 108,290
General and administrative 19,781 16,232 65,145 52,134
Restructuring and non-recurring charges 209,122 -- 209,122 --
Purchased research and development
and in merger costs -- -- -- 72,945
----------- ----------- ----------- -----------
Total operating expenses 330,777 108,425 655,796 402,651
----------- ----------- ----------- -----------
Income (loss) from operations (169,229) 41,226 (113,379) 161,062
Interest expense, net 12,716 8,288 27,959 15,757
----------- ----------- ----------- -----------
Income (loss) before income taxes (181,945) 32,938 (141,338) 145,305
Income tax provision (benefit) (59,003) 9,881 (50,882) 63,714
----------- ----------- ----------- -----------
Net income (loss) $ (122,942) $ 23,057 $ (90,456) $ 81,591
=========== =========== =========== ===========
Net income (loss) per share:
Primary $ (2.28) $ 0.48 $ (1.74) $ 1.72
Fully diluted $ (2.28) $ 0.42 $ (1.74) $ 1.52
Weighted average common and common equivalent shares:
Primary 53,971 47,736 51,841 47,319
Fully diluted 53,971 59,485 51,841 59,038
</TABLE>
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QUANTUM CORPORATION
PRO-FORMA CONSOLIDATED STATEMENTS OF OPERATIONS BEFORE NON-RECURRING CHARGES
FOR ANALYTICAL PURPOSES ONLY
( In thousands except per share amounts )
Three Months Ended Twelve Months Ended
March 31, March 31,
1996 (A) 1996 (B)
(Unaudited) (Unaudited)
------------ ------------
Sales $ 1,232,491 $ 4,422,726
Cost of sales 1,070,943 3,844,359
------------ ------------
Gross profit 161,548 578,367
------------ ------------
Expenses:
Research and development 65,177 238,426
Sales and marketing 36,697 141,163
General and administrative 19,781 65,035
------------ ------------
Total operating expenses 121,655 444,624
------------ ------------
Income from operations 39,893 133,743
Interest expense, net 12,716 27,959
------------ ------------
Income before income taxes 27,177 105,784
Income tax provision 5,765 28,562
------------ ------------
Net income $ 21,412 $ 77,222
============ ============
Net income per share:
Fully diluted $ 0.35 $ 1.32
Weighted average common and
common equivalent shares:
Fully diluted 68,562 64,283
NOTES:
(A) Excludes $209 million restructuring charge incurred in the quarter ended
March 31, 1996.
(B) Excludes $38 million resizing expenses incurred in the
quarter ended December 31, 1995 and $209 million restructuring charge
incurred in the quarter ended March 31, 1996.
