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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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): January 21, 1999
MAXTOR CORPORATION
(Exact name of registrant as specified in its charter)
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Delaware 0-14016 77-0123732
(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
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510 Cottonwood Drive
Milpitas, California 95035
(Address of principal executive offices) (Zip Code)
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Registrant's telephone number, including area code: (408) 432-1700
(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS.
On January 21, 1999, Maxtor Corporation publicly announced its operating
results for the fourth fiscal quarter and fiscal year ended December 26, 1998.
A copy of the press release announcing operating results for the fourth
fiscal quarter and fiscal year ended December 26, 1998 is attached as Exhibit
99.1 and is incorporated herein by reference.
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<CAPTION>
Exhibit
No. Description
- ------ -----------
<S> <C>
99.1 Press Release dated January 21, 1999.
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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.
MAXTOR CORPORATION
Date: January 21, 1999 By: /s/ GLENN H. STEVENS
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Glenn H. Stevens
Vice President, General Counsel and
Secretary
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EXHIBIT INDEX
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<CAPTION>
Exhibit
No. Description
- ------ -----------
<S> <C>
99.1 Press Release dated January 21, 1999.
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EXHIBIT 99.1
FOR RELEASE: CONTACT:
January 21, 1999 Catherine Hartsog
1:30 p.m. PST Investor Relations
(408) 432-4458
[email protected]
Doyle Albee
Media Relations
(303) 678-2405
[email protected]
MAXTOR ANNOUNCES FINANCIAL RESULTS FOR FOURTH QUARTER
AND FISCAL YEAR 1998
COMPANY LEVERAGES LEADERSHIP PRODUCT LINE IN SEASONALLY STRONG QUARTER
MILPITAS, CALIF., JANUARY 21, 1999 - Maxtor Corp. (NMS:MXTR) today
reported net income of $30 million or 31cents per share, diluted, on sales of
$728 million for its fourth fiscal quarter ended December 26, 1998. These
results compare to sales of $489 million and net income of $3 million, excluding
a one-time gain of $20 million, in the fourth quarter of fiscal 1997. (This
one-time gain represented the recovery of a fully reserved note related to the
sale of a subsidiary.) The company's sales for the 1998 fiscal year were $2.4
billion with net income of $31 million compared to sales of $1.4 billion and a
net loss of $130 million excluding the above-mentioned one-time gain of $20
million.
According to Mike Cannon, Maxtor's Chief Executive Officer, the
company's results for the fourth quarter demonstrate the effectiveness of the
company's operating model. "We are pleased with our continued ability to execute
well across all facets of our business," said Cannon. "Our leadership product
line and the company's focus on consistent execution put us in an excellent
position to capitalize on the seasonally strong demand we experienced this
quarter."
Maxtor shipped 5.3 million units in the fourth quarter, an increase of
23% from the third fiscal quarter. "We maintained our time-to-volume leadership
with our 4.3 GB/disk products and are in the midst of the fastest product ramp
in Maxtor's history with these drives."
-more-
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Maxtor Announces Financial Results for Q4 & FY'98 Page 2
January 21, 1999
The company also maintained focus on strengthening the balance sheet and
improving our utilization of assets. "We generated cash from operations of $86
million, our cash and short-term investments increased to $228 million at the
end of the quarter, and inventory remained flat with the prior quarter at $153
million," said Cannon. "We increased our inventory turns to 16.4 from 13.4 in
the third quarter as we maintained strategic focus on continuing to improve the
flexibility and efficiency of our operations."
This release contains forward-looking statements concerning the hard
disk drive industry and Maxtor's execution. These statements are based on
current expectations and are subject to risks and uncertainties which could
materially affect the company's results, including, but not limited to, market
demand for hard disk drives, the company's ability to execute future production
ramps and utilize manufacturing assets efficiently, pricing, and actions by
competitors. These and other risk factors are contained in Maxtor's Prospectus
as well as in its 10-K and 10-Qs.
ABOUT MAXTOR
Maxtor Corp. [NASDAQ:MXTR] develops, manufactures and markets hard disk
drives for desktop computer systems. Maxtor's current products include the
DiamondMax(TM) 4320, the DiamondMax 3400, the DiamondMax(TM) Plus 2500, and the
DiamondMax 2880 series of drives. Maxtor can be reached by phone at
(800)2-MAXTOR or on the Internet at http://www.maxtor.com.
# # #
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MAXTOR CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except share and per share amounts)
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<CAPTION>
Three months Fiscal years
ended ended
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December 26, December 27, December 26, December 27,
1998 1997 1998 1997
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(Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Revenue $ 727,804 $ 489,418 $ 2,402,286 $ 1,384,799
Revenue from affiliates 45 12,574 6,242 39,521
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Total revenue 727,849 501,992 2,408,528 1,424,320
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Cost of revenue 625,114 436,285 2,102,624 1,316,774
Cost of revenue from affiliates 250 11,529 5,491 36,162
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Total cost of revenue 625,364 447,814 2,108,115 1,352,936
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Gross profit 102,485 54,178 300,413 71,384
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Operating expenses:
Research and development 42,116 27,618 152,401 106,249
Selling, general and administrative 22,861 16,576 75,819 62,520
Stock compensation expenses 1,020 -- 12,088 --
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Total operating expenses 65,997 44,194 240,308 168,769
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Income (loss) from operations 36,488 9,984 60,105 (97,385)
Interest expense (4,675) (9,022) (28,784) (36,502)
Interest and other income 3,479 22,439* 7,415 25,031*
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Income (loss) before provision for income taxes 35,292 23,401 38,736 (108,856)
Provision for income taxes 5,294 335 7,563 1,035
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Net Income (loss) $ 29,998 $ 23,066* $ 31,173 $ (109,891)*
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Net income (loss) per share - basic $ 0.32 $ 3,050.25 $ 0.81 $ (58,112.64)
Net income (loss) per share - diluted $ 0.31 $ 0.52 $ 0.47 $ (58,112.64)
Shares used in per share calculation
- basic 94,276,066 7,563 38,295,095 1,891
- diluted 97,299,072 44,037,413 65,814,126 1,891
</TABLE>
* Includes a $20 million one-time gain from the recovery of a fully
reserved note.
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MAXTOR CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
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<CAPTION>
December 26, December 27,
ASSETS 1998 1997
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(Unaudited)
<S> <C> <C>
Current assets:
Cash and short-term investments $ 227,629 $ 16,925
Accounts receivable, net 317,292 247,647
Inventories 153,192 155,312
Prepaid expenses and other 45,198 20,814
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Total current assets 743,311 440,698
Net property, plant and equipment 108,290 99,336
Other assets 11,346 15,438
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Total Assets $ 862,947 $ 555,472
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LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
Current liabilities:
Short-term borrowings, including current portion of
long term borrowing $ 5,000 $ 100,057
Short-term borrowings due to affiliates -- 65,000
Accounts payable 427,737 231,585
Accrued and other liabilities 116,653 155,563
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Total current liabilities 549,390 552,205
Long-term debt 145,046 224,313
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Total Liabilities 694,436 776,518
Total Stockholders' Equity (deficit) 168,511 (221,046)
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Total Liabilities and Stockholders' Equity (deficit) $ 862,947 $ 555,472
========================
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