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 13, 1999
MicroAge, Inc.
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(Exact Name of Registrant as Specified in Charter)
DELAWARE File No. 0-15995 86-0321346
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification No.)
2400 South MicroAge Way, Tempe, Arizona 85282
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(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code: (602) 366-2000
Not Applicable
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(Former Name or Former Address, if Changed Since Last Report)
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ITEM 5. OTHER EVENTS.
On January 12, 1999, the Registrant reported its earnings for the
fiscal year ended November 1, 1998.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(c) Exhibits.
Exhibit No. Description
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99 Press Release dated January 12, 1999.
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SIGNATURE
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.
MICROAGE, INC.
Date: January 13, 1999 By: /s/ James R. Daniel
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James R. Daniel
Executive Vice President,
Chief Financial Officer and
Treasurer
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EXHIBIT INDEX
Exhibit
No. Description
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99 Press Release dated January 12, 1999.
MICROAGE, INC. ANNOUNCES
FOURTH QUARTER AND FISCAL YEAR END 1998 FINANCIAL RESULTS
AND STATUS OF PINACOR
TEMPE, AZ., JANUARY 12, 1999 -- (NASDAQ: MICA) MicroAge, Inc. reported
for the fourth quarter FY'98 ending November 1, 1998, consolidated revenue of
$1.6 billion, an increase of 19% when compared to Q4 FY'97 and 9% sequentially.
Consolidated net income for the fourth quarter FY'98 was $3.7 million, or $0.18
per share, exceeding the First Call consensus of $0.15 per share and represents
the third consecutive quarter of improving profitability for MicroAge, Inc. For
the first time, MicroAge, Inc. reported the financial results for Pinacor, and
MicroAge separately.
MicroAge, Inc.'s improving profitability can be attributed to improved
results in both Pinacor and MicroAge. Pinacor, a leading technology distributor,
simultaneously gained market share while increasing gross margin and also
continued to improve its cash generation cycle. MicroAge's IT services and
integration business continued to execute on its strategy of rapidly building a
significant IT services company by increasing its high margin IT services
revenue by 94%, a growth rate exceeding any of its major competitors.
For the Fiscal Year ended November 1, 1998, MicroAge, Inc. reported
record consolidated revenues of $5.5 billion, consolidated operating income of
$26 million and after taking into account goodwill amortization and net
financing expense, a consolidated loss of $8.3 million.
The consolidated financial results for each of the first three-quarters
of FY'98 have been adjusted from amounts previously reported. The decrease in
earnings is the result of increased amortization associated with a 1997
acquisition. This acquisition was originally accounted for on a pooling of
interest basis. Information recently came to light indicating that actions taken
by the former owners of an acquired business resulted in the busting of the
pooling of interest accounting method. As a result, the Company is adjusting the
previously issued consolidated results for the first three-quarters of FY'98 to
reflect this acquisition using the purchase method of accounting. The charge was
$702,000 per quarter of additional goodwill amortization shown included in other
expense in the income statement.
"In our efforts to increase shareholder value, we have also spent
considerable time since early summer exploring various financial options for
Pinacor," said Jeffrey D. McKeever, Chairman and CEO. "The options under
consideration have included an IPO, spin-off, merger or sale of Pinacor. We have
narrowed our primary focus to a specific transaction, but it is not yet
appropriate to make any announcement regarding the terms of this transaction
because negotiations are ongoing and we cannot give any assurance that the
transaction will be completed. We remain committed to taking the steps necessary
to unlock the value represented by Pinacor."
"As the Company looks to FY'99, we anticipate experiencing the same
seasonal trends as we have in recent years," McKeever added. "Therefore, we
would expect earnings per share to be in the low to mid teens for the first
quarter of FY'99."
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MicroAge, Inc., a Fortune 500 company, is a global provider of
efficient technology solutions. The Company is composed of information
technology businesses that deliver technology solutions through ISO
9001-certified, multi-vendor integration services and distributed computing
solutions to large organizations and computer resellers worldwide. The
corporation does business in more than 46 countries and offers over 20,000
products from more than 500 suppliers backed by a suite of technical, financial,
logistics and account management services. For Fiscal Year 1998, MicroAge, Inc.
had distribution revenue of $5 billion and IT service and integration revenue of
$1.8 billion.
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This press release may include forward-looking statements, which may
include projections of Revenue and Net Income and issues that may impact Revenue
or Net Income; plans for future operations including restructuring, financing
needs or plans, or plans relating to products or services of the Company;
possible financial options for Pinacor; projection of capital expenditures; as
well as assumptions relating to the foregoing. Forward-looking statements are
inherently subject to risks and uncertainties, some of which cannot be predicted
or quantified. Future events and actual results could differ materially from
those set forth in, contemplated by, or underlying the forward-looking
statements. Some of the important factors that could cause future events and
actual results to differ materially from those projected in forward-looking
statements include, but are not limited to, intense competition; narrow margins;
dependence on supplier incentive funds; product supply and dependence on key
vendors; no assurance of successful acquisitions or investments; and the capital
intensive nature of the Company's business.
Note: MicroAge's earnings press releases and financial statements are
available at no charge on the World Wide Web at www.microage.com or PR
NewsWire's Fax On Demand service at 1-888-FAX-MICA (329-6422). For additional
questions, contact MicroAge's Investor Relations Department at (602) 366-2517.
