______________________________________________________
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: January 25, 1995
COMPAQ COMPUTER CORPORATION
(Exact name of Registrant as specified in its charter)
Delaware 1-9026 76-0011617
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation or organization) File Number)
20555 SH 249, Houston, Texas 77070
(Address, including zip code,
of Registrant's principal executive offices)
Registrant's telephone number, including area code: (713) 370-0670
______________________________________________________
<PAGE>
Item 5. Other Events.
The Registrant's news release dated January 25, 1995, with
respect to its financial results for the periods ended December 31,
1994, including an unaudited consolidated balance sheet as of December
31, 1994, and an unaudited consolidated statement of income for the
periods ended December 31, 1994, is attached.
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.
Compaq Computer Corporation
January 25, 1995 /s/ Daryl J. White
--------------------------------------
Daryl J. White, Senior Vice President,
Finance, and Chief Financial Officer
(as authorized officer and as
principal financial officer)
<PAGE>
COMPAQ ANNOUNCES RECORD RESULTS
FOR FOURTH QUARTER AND YEAR
1994 Sales Increase 51%, Net Income Up 88%
HOUSTON, January 25, 1995 -- Compaq Computer Corporation
(NYSE:CPQ) today announced record 1994 sales of $10.9 billion, an
increase of 51 percent over the $7.2 billion reported in 1993. Net
income for 1994 reached $867 million, an 88 percent increase over the
$462 million reported in 1993. Earnings per share for 1994 increased 80
percent to a record $3.21, compared with $1.78 for 1993.*
Sales, net income and earnings per share for the fourth quarter
ended December 31, 1994 also reached record levels. Fourth quarter
sales were $3.25 billion, a 48 percent increase over the $2.2 billion
in 1993 and net income reached $243 million, a 61 percent increase over
the $151 million reported in the fourth quarter 1993. Earnings per
share for the fourth quarter were $.90 versus $.58 for the same period
in 1993.*
"These results reflect an excellent fourth quarter and outstanding
year for Compaq," said Eckhard Pfeiffer, president and chief executive
officer, Compaq Computer Corporation. "In 1994, shipments increased by
over 50 percent to 4.8 million units due to strong customer demand for
Compaq computers worldwide."
(more)
<PAGE>
Compaq Announces 4Q94 and Year End Results 2-2-2
"Compaq's push past the $10 billion sales mark is due to the
diligent and spirited performance of Compaq employees all over the
world," said Pfeiffer. "Our employees have responded to the
challenges of leadership in customer satisfaction, innovation and
product quality. Customers, in turn, have responded by making Compaq
their computer of choice," he said.
1994 Highlights
Achievement of Number One Worldwide Marketshare
In 1994, Compaq became the largest supplier of personal computers
in the world, fueled by its jump to number one in the worldwide desktop
PC market. The Company took the number one position worldwide with 10
percent marketshare, according to preliminary International Data
Corporation figures. This achievement is a testament to the Company's
employees, its products and strategies.
Record Number of New Products
In 1994, Compaq introduced and shipped a record number of
products, ranging from consumer desktops to rack-mounted servers.
In September, the Company strengthened its position in the
consumer PC market with the next generation of its award-winning
Presario desktop line, integrating home and home office appliances,
including cable-ready television capability.
(more)
<PAGE>
Compaq Announces 4Q94 and Year End Results 3-3-3
The Compaq LTE Elite, the powerful new family of high performance
notebook PCs, brought to market the industry's first built-in AC
adapter in a full-function notebook.
As Compaq continued to set the pace for innovation and technology
leadership, it replaced the highly-successful Deskpro/M line with the
new network-ready flagship PC, the Deskpro/XL business desktop.
In late June, Compaq introduced the high-performance Rack-
Mountable ProLiant family of servers, vertically packaged in highly
serviceable modular rack cabinets that address MIS managers' needs for
consolidation and manageability previously only available with mission-
critical minicomputer and mainframe systems.
Distribution Expansion
In order to make products more accessible to customers, Compaq
expanded the number of worldwide marketing partners from approximately
21,000 locations at the beginning of 1994 to more than 38,000 by year
end. Additions include Wal-Mart, Sears and Ingram Micro in the U.S.,
Carrefour and PCW in France, ESCOM in Germany, Merlin in Denmark, and
retail outlets within the Thorn EMI group of companies in the U.K.
The Company also expanded its European reach by establishing subsidiaries
in South Africa, Bahrain and the Czech Republic.
(more)
<PAGE>
Compaq Announces 4Q94 and Year End Results 4-4-4
New Manufacturing On Line
A record number of products announced in 1994, coupled with the
need to keep pace with the growing level of demand, fueled the
requirement for new manufacturing lines. In February, Compaq expanded
its manufacturing operations in Houston and added seven new lines for
desktop and portable PC production. In March, Compaq opened its first
Latin America manufacturing facility in Brazil, enabling it to increase
the production of its desktop PCs and serve the growing needs of the
Latin America market. In April, Compaq significantly expanded its
manufacturing facility in Singapore with the addition of eight new
lines enabling the Company to increase the production of its portable
and desktop PCs. In August, Compaq opened its first manufacturing
plant in Shenzhen, China where ProLinea and Deskpro/XL PCs are produced
for distribution in China and certain other Asian markets.
1995 Outlook
"Compaq expects strong growth throughout 1995," said Pfeiffer.
"The Company will continue to focus on marketshare growth in all
regions and to increase participation in our targeted market segments.
Our efforts will include an aggressive 1995 product announcement
schedule for our desktop, notebook, server products and consumer PCs.
We will also make significant investments in our service and support
infrastructure, particularly in the enterprise client server market."
"Compaq expects continued solid growth in sales but relatively
flat earnings in the first quarter of 1995 compared to 1994," Pfeiffer
said. "Last year's first quarter earnings were exceptionally high due
to gross margins that exceeded the Company's financial model," he
explained. "This year Compaq confronts
(more)
<PAGE>
Compaq Announces 4Q94 and Year End Results 5-5-5
the challenges of significant product transitions in the first quarter
and has adopted a conservative inventory stance for that period.
Compaq will also put in place programs to allow us to meet our
customers' needs in the coming year. The Company will back its strong
belief in future growth with significant investments in process re-
engineering, research and development, marketing and advertising
programs and the expansion of its service and support infrastructure.
These investments should allow us to extend our leadership in worldwide
marketshare and position Compaq for our primary goal of unsurpassed
customer satisfaction."
Background
Compaq Computer Corporation is a world leader in the manufacture
of desktop and notebook personal computers and servers. Founded in
1982, the company reported 1994 worldwide sales of $10.9 billion.
Compaq products are sold and supported in more than 100
countries through a network of more than 38,000 marketing partner
locations. Compaq also sells directly to customers through Compaq
Direct Plus at 1-800-888-5858.
FOR COMPAQ CUSTOMER SUPPORT AND INFORMATION, CALL 800-345-1518.
(Attached is the Consolidated Balance Sheet and Statement of Income)
# # #
*All earnings per share information reflects a 3-for-1 stock split
effective May 31, 1994.
Compaq, Presario, Deskpro, Registered U.S. Patent and Trademark
Office. ProLinea, LTE and LTE Elite are trademarks of Compaq Computer
Corporation. DirectPlus is a service mark of Compaq Computer
Corporation. Product names mentioned herein may be trademarks and/or
registered trademarks of their respective companies.
For further editorial information, contact:
Nora Hahn, Bob Beach Tony Sapienza, Donna Ruane
Compaq Computer Corporation Miller Communications
713-374-1560 617-536-0470
<PAGE>
COMPAQ COMPUTER CORPORATION
CONSOLIDATED BALANCE SHEET
(Unaudited)
ASSETS
December 31,
1994 1993
------ ------
(in millions)
Current assets:
Cash and cash equivalents $ 471 $ 627
Accounts receivable, net 2,287 1,377
Inventories 2,005 1,123
Deferred income taxes 303 126
Prepaid expenses and other current assets 92 38
------ ------
Total current assets 5,158 3,291
------ ------
Property, plant and equipment, less accumulated
depreciation 944 779
Other assets 64 14
------ ------
$6,166 $4,084
====== ======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 888 $ 637
Income taxes payable 246 69
Other current liabilities 879 538
------ ------
Total current liabilities 2,013 1,244
------ ------
Long-term debt 300
------ ------
Deferred income taxes 179 186
------ ------
Stockholders' equity:-
Preferred stock, $.01 par value: 10 million shares
authorized; none outstanding
Common stock and capital in excess of $.01 par
value: 400 million shares
authorized; 261.0 million shares and 253.0 739 586
million shares issued and outstanding
Retained earnings 2,935 2,068
------ ------
Total stockholders' equity 3,674 2,654
------ ------
$6,166 $4,084
====== ======
<PAGE>
COMPAQ COMPUTER CORPORATION
CONSOLIDATED STATEMENT OF INCOME
(Unaudited)
Year ended Quarter ended
--------------- --------------
December 31, December 31,
1994 1993 1994 1993
------- ------ ------ ------
(in millions, except per share
amounts)
Sales $10,866 $7,191 $3,251 $2,202
Cost of sales 8,139 5,493 2,457 1,680
------- ------ ------ ------
2,727 1,698 794 522
------- ------ ------ ------
Research and development costs 226 169 61 43
Selling, general and
administrative expense 1,235 837 368 251
Other income and expense, net 94 76 36 25
------- ------ ------ ------
1,555 1,082 465 319
------- ------ ------ ------
Income from consolidated
companies before provision
for income taxes 1,172 616 329 203
Provision for income taxes 305 154 86 52
------- ------ ------ ------
Net income $ 867 $ 462 $ 243 $ 151
======= ====== ====== ======
Earnings per common and common
equivalent share:
Primary (1) $ 3.23 $ 1.82 $ 0.90 $ 0.58
======= ====== ====== ======
Assuming full dilution (1) $ 3.21 $ 1.78 $ 0.90 $ 0.58
======= ====== ====== ======
Shares used in computing earnings
per common and common
equivalent share:
Primary (1) 268.6 254.1 270.6 260.4
======= ====== ====== ======
Assuming full dilution (1) 270.1 258.9 270.8 261.2
======= ====== ====== ======
(1) All share and per-share information reflects a 3-for-1
stock split effective May 31, 1994.
