<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________
FORM 10-Q
_______________
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______ to _______
Commission file number 0-21103
ADVANCED DIGITAL INFORMATION CORPORATION
Incorporated under the laws I.R.S. Identification
of the State of Washington No. 91-1618616
11431 Willows Road
P.O. Box 97057
Redmond, Washington 98073-9757
(425) 881-8004
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
[X] Yes [ ] No
The total shares of common stock without par value outstanding at the end of
the quarter reported is 9,857,535.
<PAGE>
PART I -- FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ADVANCED DIGITAL INFORMATION CORPORATION
CONSOLIDATED BALANCE SHEETS
APRIL 30, 1999 AND OCTOBER 31, 1998
<TABLE>
<CAPTION>
APRIL 30, OCTOBER 31,
1999 1998
------------ ------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.................... $ 14,769,281 $ 28,225,892
Marketable equity securities................. 49,436 2,135,449
Accounts receivable, net of allowances of
$478,000 in 1999 and $476,000 in 1998....... 35,207,402 31,797,375
Inventories, net............................. 37,030,917 32,293,526
Prepaid expenses and other................... 1,613,915 1,500,145
Deferred income taxes........................ 1,339,879 1,339,879
------------ ------------
Total current assets....................... 90,010,830 97,292,266
------------ ------------
Property, plant and equipment, net............. 7,187,599 7,351,305
Deferred income taxes.......................... 62,681 62,681
Investment in common stock..................... 8,000,000 4,000,000
Intangible and other assets.................... 2,496,592 3,700,374
------------ ------------
$107,757,702 $112,406,626
------------ ------------
------------ ------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable............................. $ 16,969,611 $ 16,986,445
Accrued liabilities.......................... 8,862,898 7,901,981
Income taxes payable......................... 547,517 397,539
Deferred revenue............................. 2,742,774 2,252,106
Current portion of long-term debt............ 3,167,056 3,172,328
------------ ------------
Total current liabilities.................. 32,289,856 30,710,399
------------ ------------
Long-term debt................................. 6,369,808 18,368,092
Other long-term liabilities.................... -- 300,000
Minority interest.............................. 307,617 24,744
Commitments.................................... -- --
Shareholders' equity:
Preferred stock, no par value; 2,000,000
shares authorized; none issued and
outstanding................................. -- --
Common stock, no par value; 40,000,000 shares
authorized, 9,857,535 issued and outstanding
(9,766,161 in 1998)......................... 46,976,418 46,231,387
Retained earnings............................ 22,606,115 16,009,334
Cumulative translation adjustment............ (792,112) 762,670
------------ ------------
Total shareholders' equity................. 68,790,421 63,003,391
------------ ------------
$107,757,702 $112,406,626
------------ ------------
------------ ------------
</TABLE>
See the accompanying notes to these consolidated financial statements.
2
<PAGE>
ADVANCED DIGITAL INFORMATION CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
THREE MONTHS AND SIX MONTHS ENDED APRIL 30, 1999 AND 1998 (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
APRIL 30, APRIL 30,
1999 1998 1999 1998
----------- ----------- ------------ -----------
<S> <C> <C> <C> <C>
Net sales......................... $54,044,290 $24,805,894 $103,188,547 $47,671,556
Cost of sales..................... 36,005,476 17,795,731 68,755,371 33,246,523
----------- ----------- ------------ -----------
Gross profit.................... 18,038,814 7,010,163 34,433,176 14,425,033
----------- ----------- ------------ -----------
Operating expenses:
Selling and administrative...... 8,980,091 4,181,621 18,093,563 7,965,340
Research and development........ 3,235,468 627,479 6,050,939 1,245,078
----------- ----------- ------------ -----------
12,215,559 4,809,100 24,144,502 9,210,418
----------- ----------- ------------ -----------
Operating profit.................. 5,823,255 2,201,063 10,288,674 5,214,615
----------- ----------- ------------ -----------
Other income:
Interest income................. 90,112 246,112 324,264 567,280
Interest expense................ (202,207) -- (546,462) --
Gain on sale of marketable
equity securities............. -- 247,814 563,737 247,814
Foreign currency transaction
gains, net.................... 63,223 23,738 89,941 263,726
----------- ----------- ------------ -----------
(48,872) 517,664 431,480 1,078,820
----------- ----------- ------------ -----------
Income before provision for
income taxes.................... 5,774,383 2,718,727 10,720,154 6,293,435
Minority interest................. 162,933 -- 282,873 --
Provision for income taxes........ 2,066,510 784,813 3,840,500 1,998,231
----------- ----------- ------------ -----------
Net income........................ $ 3,544,940 $ 1,933,914 $ 6,596,781 $ 4,295,204
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
Basic net income per share $ 0.36 $ 0.20 $ 0.67 $ 0.44
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
Diluted net income per share $ 0.35 $ 0.20 $ 0.66 $ 0.43
----------- ----------- ------------ -----------
----------- ----------- ------------ -----------
</TABLE>
See the accompanying notes to these consolidated financial statements.
3
<PAGE>
ADVANCED DIGITAL INFORMATION CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED APRIL 30, 1999 AND 1998 (UNAUDITED)
<TABLE>
<CAPTION>
1999 1998
------------ ------------
<S> <C> <C>
Cash flows from operating activities:
Net income.............................................. $ 6,596,781 $ 4,295,204
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization....................... 1,813,145 493,689
Minority interest................................... 282,873 --
Assets retired...................................... 68,494 --
Gain on sale of marketable equity securities........ (563,737) (247,814)
Change in assets and liabilities:
Accounts receivable................................... (3,943,075) (4,331,300)
Inventories........................................... (5,729,292) (5,637,980)
Prepaid expenses and other............................ (203,948) (95,900)
Other assets.......................................... 287,851 28,492
Accounts payable...................................... 367,483 (4,211,776)
Accrued liabilities................................... 1,292,893 (719,888)
Income taxes payable.................................. 1,082,670 (367,231)
Deferred revenue...................................... 576,391 --
------------ ------------
Net cash provided by (used in) operating activities..... 1,928,529 (10,794,504)
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property, plant and equipment............. (2,136,099) (1,506,817)
Investment in marketable equity securities............ (49,436) (1,295,270)
Proceeds from sale of marketable equity securities.... 2,699,186 1,116,273
Investment in common stock............................ (4,000,000) --
------------ ------------
Net cash used in investing activities................... (3,486,349) (1,685,814)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long-term debt........................... (11,801,857) --
Repayment of other long-term liabilities.............. (300,000) --
Proceeds from issuance of common stock for stock
options, including tax benefit...................... 745,031 107,177
------------ ------------
Net cash provided by (used in) financing activities..... (11,356,826) 107,177
------------ ------------
Effect of exchange rate changes on cash................. (541,965) (106,631)
------------ ------------
Net decrease in cash and cash equivalents............... (13,456,611) (12,479,772)
Cash and cash equivalents at beginning of period........ 28,225,892 32,806,822
------------ ------------
Cash and cash equivalents at end of period.............. $ 14,769,281 $ 20,327,050
------------ ------------
------------ ------------
</TABLE>
See the accompanying notes to these consolidated financial statements.
4
<PAGE>
ADVANCED DIGITAL INFORMATION CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDER'S EQUITY
SIX MONTHS ENDED APRIL 30, 1999 (UNAUDITED)
<TABLE>
<CAPTION>
ACCUMULATED
COMMON STOCK OTHER
--------------------- RETAINED COMPREHENSIVE
SHARES AMOUNT EARNINGS INCOME TOTAL
--------- ----------- ----------- -------------- -----------
<S> <C> <C> <C> <C> <C>
Balance at October 31, 1998............. 9,766,161 $46,231,387 $16,009,334 $ 762,670 $63,003,391
Purchases under Stock Purchase Plan 50,998 292,602 292,602
Exercise of stock options,
including tax benefit of
$123,000.............................. 40,376 452,429 452,429
Comprehensive income:
Net income............................ 6,596,781
Foreign currency translation
adjustment.......................... (1,554,782)
Comprehensive income.............. 5,041,999
--------- ----------- ----------- ----------- -----------
Balance April 30, 1999.................. 9,857,535 $46,976,418 $22,606,115 $ (792,112) $68,790,421
--------- ----------- ----------- ----------- -----------
--------- ----------- ----------- ----------- -----------
</TABLE>
See the accompanying notes to these consolidated financial statements.
5
<PAGE>
ADVANCED DIGITAL INFORMATION CORPORATION
NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS
APRIL 30, 1999 (UNAUDITED)
NOTE 1. BASIS OF PRESENTATION
The accompanying condensed financial statements are unaudited and should
be read in conjunction with the Advanced Digital Information Corporation
financial statements included in the Company's Annual Report on Form 10-K for
the year ended October 31, 1998. In the opinion of management, all normal
recurring adjustments which are necessary for the fair presentation of the
results for the interim periods are reflected herein. Operating results for
the six-month period ended April 30, 1999, are not necessarily indicative of
results to be expected for a full year.
NOTE 2. EARNINGS PER SHARE
The following table sets forth the computation of basic and diluted net
income per share for the three months and six months ended April 30, 1999 and
1998:
<TABLE>
<CAPTION>
Three months ended Six months ended
April 30, April 30,
1999 1998 1999 1998
<S> <C> <C> <C> <C>
Numerator:
Net income................................... $ 3,544,940 $ 1,933,914 $ 6,596,781 $ 4,295,204
Denominator:
Denominator for basic net income per share
- weighted average shares.................. 9,833,957 9,732,402 9,803,291 9,716,982
Dilutive potential common shares from
Team Member (employee) stock options...... 278,805 176,706 240,509 189,084
----------- ----------- ----------- ----------
Denominator for diluted net income per
share - adjusted weighted average shares
and assumed conversions.................... 10,112,762 9,909,108 10,043,800 9,906,066
----------- ----------- ----------- ----------
----------- ----------- ----------- ----------
Basic net income per share..................... $ 0.36 $ 0.20 $ 0.67 $ 0.44
----------- ----------- ----------- ----------
----------- ----------- ----------- ----------
Diluted net income per share................... $ 0.35 $ 0.20 $ 0.66 $ 0.43
----------- ----------- ----------- ----------
----------- ----------- ----------- ----------
</TABLE>
NOTE 3. INVENTORIES
Inventory is comprised as follows:
<TABLE>
<CAPTION>
April 30, 1999 October 31, 1998
-------------- ----------------
<S> <C> <C>
Finished goods...................... $14,881,473 $13,104,058
Work-in-process..................... 4,102,028 3,382,683
Raw materials....................... 20,719,674 17,951,520
----------- -----------
39,703,175 34,438,261
Allowance for inventory obsolescence. (2,672,258) (2,144,735)
----------- -----------
$37,030,917 $32,293,526
----------- -----------
----------- -----------
</TABLE>
6
<PAGE>
NOTE 4. INVESTMENT IN NETWORK INTEGRITY, INC.
In December 1998, the Company purchased an approximately 8% interest in
Network Integrity, Inc. for an aggregate purchase price of $4,000,000. This
investment is accounted for under the cost method. Network Integrity, Inc. is
a developer of specialized data protection software products.
NOTE 5. INVESTMENT IN MARKETABLE EQUITY SECURITIES
At April 30, 1999, the Company has invested in certain equity
securities. In accordance with Statement of Financial Accounting Standards
No. 115, "Accounting for Certain Investments in Debt and Equity Securities"
("FAS 115") these investments are classified as available-for-sale. Under FAS
115, unrealized holding gains and losses are reflected as a net amount in a
separate component of shareholders' equity until realized. For the purpose of
computing realized gains and losses, costs are identified on a specific
identification basis. There is no significant difference between the cost
basis and fair value of these securities at April 30, 1999. During the
quarter ended January 31, 1999, the Company sold certain marketable equity
securities and realized a gain of $564,000.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
RESULTS OF OPERATIONS
The following discussion and analysis may contain forward-looking
statements that involve risks and uncertainties, such as statements of the
Company's plans, objectives, expectations and intentions. The Company's actual
results could differ materially from those discussed here. Such risks are
detailed in the Company's Annual Report on Form 10-K filed with the SEC in
January 1999 and are incorporated herein by reference. Readers are cautioned
not to place undue reliance on these forward-looking statements, which speak
only as of the date hereof. The Company undertakes no obligation to publicly
release the result of any revisions to these forward-looking statements that
may be made to reflect events or circumstances after the date hereof or to
reflect the occurrence of unanticipated events.
NET SALES. Net sales for the three months ended April 30, 1999
increased 118% to $54.0 million from $24.8 million for the same period in
fiscal 1998. Net sales for the six months ended April 30, 1999 were $103.2
million, an increase of 116% versus the six months ended April 30, 1998. A
substantial portion of the increase in net sales for the quarter and six
months was due to the inclusion of sales from ADIC Denver and ADIC / GRAU,
both part of the Company's acquisition of EMASS, Inc. in August 1998.
Additionally, there was strong sales growth across most product lines in both
the Company's branded products and its OEM business.
GROSS PROFIT. Gross profit was $18.0 million or 33% of net sales for the
three months ended April 30, 1999 compared to $7.0 million or 28% of net
sales for the same period in fiscal 1998. Gross profit percentage for the
quarter and current six-month period was higher than the same periods in
fiscal 1998 due to a shift in product mix toward higher-margin tape
libraries, software and service, away from lower margin standalone tape
drives and media, as well as the effects of overall volume increases.
Offsetting this trend are higher overhead costs associated with the Company's
new Redmond facility and increases in personnel to support the OEM business,
all of which began to be incurred late in the second quarter of fiscal 1998.
Gross profit margins are dependent on a number of factors, including customer
7
<PAGE>
and product mix, price competition and tape drive costs. There can be no
assurance that the Company can improve upon or maintain the current gross
margin levels for a given product line, in that tape drives purchased from
third-party suppliers are a significant component of the Company's product
costs.
SELLING AND ADMINISTRATIVE EXPENSES. Selling and administrative
expenses were $9.0 million or 17% of net sales for the three months ended
April 30, 1999 compared to $4.2 million or 17% of net sales for the same
period in fiscal 1998. The dollar increases in selling and administrative
expenses in the three months and six months ended April 30, 1999 over the
comparable periods in fiscal 1998 was due primarily to the inclusion of ADIC
Denver and ADIC / GRAU, but also to increased sales and administrative
personnel both in the headquarters office and in regional offices throughout
the United States. The Company expects that selling and administrative
expenses as a percentage of net sales will increase slightly throughout
fiscal 1999 as the Company continues to invest in potential OEM relationships.
RESEARCH AND DEVELOPMENT EXPENSES. Research and development expenses
were $3.2 million or 6% of net sales for the three months ended April 30,
1999 compared to $627,000 or 3% of net sales for the same period in fiscal
1998. The Company expects to maintain this higher level of research and
development spending as it continues investing heavily in software
development and new library hardware products.
OTHER INCOME. Interest income for the three months ended April 30, 1999
was $90,000 compared to $246,000 for the same period in fiscal 1998. This
decrease is the result of lower cash balances reflecting cash utilization for
investments in ADIC Denver and ADIC / GRAU in fiscal 1998 and in Network
Integrity, Inc. in December 1998 as well as for paydown of the Company's
long-term debt. Interest expense in fiscal 1999 relates primarily to interest
on a bank loan, the proceeds of which were used to partially finance the
acquisition of ADIC Denver and ADIC / GRAU. The gain on sale of marketable
equity securities relates to investments in certain securities made in fiscal
1998 and sold in the first quarter of fiscal 1999. Net foreign currency
translation gains increased to approximately $63,000 for the current quarter.
Foreign currency gains or losses arise as a result of the operation of
the Company's European subsidiaries, ADIC Europe and ADIC / GRAU, the
functional currencies of which are the French franc and German deutsche mark,
respectively. All monetary assets are translated into the functional
currencies on the financial statements of ADIC Europe and ADIC / GRAU. ADIC
Europe buys products from ADIC in U.S. dollars and resells a significant
majority of such products in U.S. dollars. ADIC / GRAU both buys and sells
products to ADIC Denver in U.S. dollars. ADIC / GRAU's sales are primarily in
deutsche marks and the sales of its subsidiaries in U.K. and France, which
act as sales offices in those countries, are made primarily in British pounds
sterling and French francs, respectively. Certain of the U.S. dollar
receivables and payables in these entities offset to reduce the Company's
exposure to transaction gains and losses. To the extent that these monetary
assets and liabilities do not fully offset each other and the U.S. dollar
exchange rate changes with respect to these currencies, transaction gains or
losses may result. For large sales denominated in other currencies, the
Company attempts to implement appropriate hedging strategies.
PROVISION FOR INCOME TAXES. Income tax expense for the three months
ended April 30, 1999 was $2.1 million compared to $785,000 for the same
period in fiscal 1998. The Company believes that the 36% effective tax rate
reflected in its results for the six-month period, which includes taxes paid
in various federal, state and international jurisdictions, is generally
indicative of the Company's effective tax rate in future periods. There are
significant deferred tax assets associated with net operating loss
carryforwards and other timing differences of ADIC Denver and ADIC / GRAU. A
valuation allowance
8
<PAGE>
has been established on these deferred tax assets because it is more likely
than not that these deferred assets will not be realized. In the event that
earnings of these companies allow the Company to deduct these expenses for
tax purposes and recognize these assets, the Company reallocates the purchase
price to reduce noncurrent intangible assets related to the acquisition.
LIQUIDITY AND CAPITAL RESOURCES
The Company's operating activities generated $1.9 million of cash in the
first six months of fiscal 1999. Such cash was generated from net income and
depreciation which is offset in part by cash used to fund increases both in
inventories and receivables. Additionally, the Company used funds of $3.5
million in investing activities which is the net result of the $4.0 million
investment in Network Integrity, Inc., ongoing investment in property, plant
and equipment and proceeds on sale of marketable equity securities.
At April 30, 1999, the Company had cash and cash equivalents of $14.8
million. Its working capital, the difference between current assets and
current liabilities is $57.8 million, with a ratio of current assets to
current liabilities of 2.8:1. The Company also has a $10.0 million bank line
of credit that expires in February 2001. Any borrowings under this line of
credit would bear interest at the banks' prime rate or adjusted LIBOR rate. No
borrowings have been made under this line of credit. The Company had no
material or unusual commitments as of April 30, 1999 other than annual rental
commitments. At April 30, 1999, the Company was negotiating for additional
operating lines of credit, the proceeds of which may be used to repay
long-term debt and for other strategic purposes.
The Company believes that its existing cash and cash equivalents and
bank line of credit, together with the results of operations, will be
sufficient to fund its working capital and capital expenditure needs for at
least the next twelve months. Further, ADIC believes that cash balances are
likely to increase over the remainder of the fiscal year. The Company may
utilize cash to acquire or invest in businesses, products or technologies
that it believes are strategic. From time to time, in the ordinary course of
business, the Company evaluates potential acquisitions of such businesses,
products or technologies. However, the Company has no present understanding,
commitments or agreements with respect to any material acquisition of other
businesses, products or technologies.
YEAR 2000
The Company is aware of the issues associated with the programming code
in existing computer systems and the inability of many of these products to
distinguish between twentieth-century dates and twenty-first century dates to
determine the applicable year. This error could result in a system failure or
miscalculations causing disruptions of operations, including, among other
things, a temporary inability to process transactions, send invoices, or
engage in similar normal business activities. The Company is actively
assessing the impact of the upcoming change on its business, financial
condition and results of operations.
Based on the Company's assessment to date, the Company believes the
current versions of its software and hardware products and services are Year
2000 compliant. New products are being designed to be Year 2000 compliant.
While most of the Company's internally manufactured library products have no
date functionality built into them, this is not true for certain software and
large library products. Year 2000 compliant updates are currently available
for all of these products and the Company's service personnel are able to
install these upgrades in conjunction with its ordinary maintenance
contracts. The Company is reviewing hardware used in connection with its
products for those customers with current
9
<PAGE>
service maintenance contracts. Plans exist to replace certain systems that
can not be made compliant and upgrade those that can. Total cost to replace
this hardware approximates $250,000 a portion of which is reimbursed by
customers. There can be no assurance that all existing Company products will
contain all necessary date codes. Further, use of the Company's products in
connection with other products which are not Year 2000 compliant, including
non-compliant hardware, software and firmware may result in the inaccurate
exchange of dates and result in performance problems or system failure. Any
failure of the Company's products to perform could result in claims against
the Company. The cost of defending any such claim which may arise, as well as
any liability of the Company for Year 2000 related damages could have a
material adverse effect on the Company's business, results of operations and
financial condition.
The Company's business depends on numerous systems that could potentially
be impacted by Year 2000 related problems. The Company is assessing the
possible effects on the Company's operations of the Year 2000 readiness of its
enterprise resource planning computer systems and other internal systems. The
Company believes that the enterprise resource planning computer systems at
its various manufacturing sites are either Year 2000 compliant currently or
can be modified to ensure compliance. Other internal systems are currently
being assessed, and based on such assessment the Company will modify or
replace such systems. The Company expects the assessments and tests of these
systems to be completed in mid-to late 1999.
The Company's reliance on key suppliers, and therefore on the proper
function of their information systems and software, means that their failure
to address Year 2000 issues could have a material impact on the Company's
operations and financial results. The Company has asked key suppliers to
provide information regarding their readiness for Year 2000 related issues
and has received responses from substantially all of them. The Company is
reviewing the responses and will determine what further actions are required
to mitigate vulnerability to problems with suppliers and other third parties'
systems.
The Company expects to incur primarily internal staff cost and other
expenses related to infrastructure and facilities enhancements necessary to
prepare the systems for Year 2000. To date there have been no material direct
out-of-pocket costs. Although the total cost of these Year 2000 compliance
activities is not yet determined, it is not anticipated to be material to the
Company's business, results of operations and financial condition. The Company
has not completed a contingency plan for handling Year 2000 problems that are
not detected and corrected prior to their occurrence, but expects to have
such plans in place for critical systems in mid to late 1999. Any failure of
the Company to address any unforeseen Year 2000 issue could adversely affect
the Company's business, financial condition and results of operations.
10
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
None
Item 3. Defaults Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders.
None
Item 5. Other information.
None
Item 6. Exhibits and Reports on Form 8-K.
None
11
<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 thereunto duly authorized.
ADVANCED DIGITAL INFORMATION CORPORATION
Dated: June 14, 1999 /s/ Peter H. van Oppen
------------------------------------
Peter H. van Oppen, Chairman
and Chief Executive Officer
Dated: June 14, 1999 /s/ Leslie S. Rock
------------------------------------
Leslie S. Rock, Treasurer
and Chief Accounting Officer
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> OCT-31-1999
<PERIOD-START> NOV-01-1998
<PERIOD-END> APR-30-1999
<CASH> 14,769
<SECURITIES> 49
<RECEIVABLES> 35,685
<ALLOWANCES> 478
<INVENTORY> 37,031
<CURRENT-ASSETS> 90,011
<PP&E> 7,188
<DEPRECIATION> 0
<TOTAL-ASSETS> 107,758
<CURRENT-LIABILITIES> 32,290
<BONDS> 6,370
0
0
<COMMON> 0
<OTHER-SE> 68,790
<TOTAL-LIABILITY-AND-EQUITY> 107,758
<SALES> 103,189
<TOTAL-REVENUES> 103,189
<CGS> 68,755
<TOTAL-COSTS> 68,755
<OTHER-EXPENSES> 6,051
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 546
<INCOME-PRETAX> 10,720
<INCOME-TAX> 3,841
<INCOME-CONTINUING> 6,597
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,597
<EPS-BASIC> .67
<EPS-DILUTED> .66
</TABLE>
