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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K/A
AMENDMENT TO CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported)
June 29, 1998
DIAMOND MULTIMEDIA SYSTEMS, INC.
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(Exact Name of Registrant as Specified in Charter)
Delaware
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(State or other jurisdiction of incorporation)
0-25580 77-0390654
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(Commission File No.) (IRS Employer Identification Number)
2880 Junction Avenue
San Jose, California 95134
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(Address of Principal Executive Offices)
(408) 325-7000
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(Registrant's Telephone Number, Including Area Code)
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DIAMOND MULTIMEDIA SYSTEMS, INC.
FORM 8-K/A
AMENDMENT TO CURRENT REPORT
TABLE OF CONTENTS
Micronics Computers, Inc. Unaudited Condensed Statement of Operations for the
Three Months and Nine Months Ended June 30, 1998 ........................... 2
Unaudited Pro Forma Consolidated Condensed Statement of Operations for the
Year Ended December 31, 1997 ................................................ 3
Unaudited Pro Forma Consolidated Condensed Statement of Operations for the
Six Months Ended June 30, 1998 .............................................. 3
Unaudited Pro Forma Consolidated Condensed Balance Sheet as of June 30, 1998 . 4
The undersigned registrant hereby amends the following items, financial
statements, exhibits or other portions of its current report on Form 8-K
originally filed with the Securities and Exchange Commission on July 14, 1998.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
Micronics Computers, Inc.
UNAUDITED CONDENSED STATEMENT OF
OPERATIONS For the Three Months Ended June
30, 1998 (In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended June 30, 1998
----------------------------
<S> <C> <C>
Net sales ............................. $ 8,140 $ 66,610
Cost of sales ......................... 20,740 74,397
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Gross profit .......................... (12,600) (5,787)
-------- --------
Operating expenses:
Research and development ........... 997 3,716
Selling, general and administrative 5,988 13,080
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Total operating expenses ........ 6,985 16,796
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Loss from operations .................. (19,585) (22,583)
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Other income (expense):
Interest income, net .................. 200 797
Other expense, net .................... (80) (177)
-------- --------
Loss before income taxes .............. (19,465) (21,963)
Provision (benefit) for income taxes .. -- --
-------- --------
Net loss .............................. $(19,465) $(21,963)
======== ========
</TABLE>
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<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
Year Ended December 31, 1997
(In thousands, except per share amounts)
Diamond
Multimedia Micronics Pro Forma Pro Forma
Systems, Inc. Computers, Inc.(3) Adjustments Consolidated
-----------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales ................................. $ 443,281 $ 82,547 $ -- $ 525,828
Cost of sales ............................. 387,486 76,222 -- 463,708
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Gross profit .............................. 55,795 6,325 -- 62,120
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Operating expenses:
Research and development ............... 24,886 5,176 -- 30,062
Selling, general and administrative .... 85,684 12,614 -- 98,298
Amortization of intangibles ............ 3,006 -- 3,936 (2) 6,942
Write-off of intangibles ............... 9,938 -- -- 9,938
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Total operating expenses ............ 123,514 17,790 3,936 145,240
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Income (loss) from operations ............. (67,719) (11,465) (3,936) (83,120)
Other income (expense):
Interest income, net ...................... 1,696 1,136 -- 2,832
Other income (expense), net ............... 873 (345) -- 528
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Loss before income taxes .................. (65,150) (10,674) (3,936) (79,760)
Benefit for income taxes .................. (19,545) -- -- (19,545)
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Net loss .................................. $ (45,605) $ (10,674) $ (3,936) $ (60,215)
==============================================================
Net loss per common share ................. $ (1.33) $ (1.75)
Shares used in computing per share amounts 34,322 34,322
</TABLE>
<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
For the Six Months Ended June 30, 1998
(In thousands, except per share amounts)
Diamond
Multimedia Micronics Pro Forma Pro Forma
Systems, Inc. Computers, Inc. Adjustments Consolidated
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<S> <C> <C> <C> <C>
Net sales ................................. $ 358,543 $ 19,013 $ (791)(1) $ 376,765
Cost of sales ............................. 296,454 31,132 (694)(1) 326,892
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Gross profit .............................. 62,089 (12,119) (97) 49,873
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Operating expenses:
Research and development ............... 14,260 2,144 (23)(1) 16,381
Selling, general and administrative .... 46,905 8,407 (41)(1) 55,271
Amortization of intangibles ............ 488 -- 1,968 (2) 2,456
Restructuring expenses ................. 1,384 -- -- 1,384
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Total operating expenses ............ 63,037 10,551 1,904 75,492
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Income (loss) from operations ............. (948) (22,670) (2,001) (25,619)
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Other income (expense):
Interest income, net ...................... 493 442 (6)(1) 929
Other income (expense), net ............... (55) 63 (29)(1) (21)
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Loss before income taxes .................. (510) (22,165) (2,036) (24,711)
Benefit for income taxes .................. (153) -- -- (153)
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Net loss .................................. $ (357) $ (22,165) $ (2,036) $ (24,558)
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Net loss per common share ................ $ (0.01) $ (0.71)
Shares used in computing per share amounts 34,799 34,799
</TABLE>
(1) Record the elimination of Micronics operating results from June 27, 1998
through June 30, 1998. The results of this period are included in the
operating results for both the Company and Micronics.
(2) Reflects additional amortization expense of goodwill as if the
acquisition of Micronics had occurred at the beginning of the period
presented. Goodwill is amortized on a straight-line basis over five
years. Such amortization is based on an estimate of the value of goodwill
and may change based upon the final determination of the fair value of
net assets acquired from Micronics and the allocation of excess purchase
price between goodwill and in-process technology.
(3) Micronics Computers, Inc. fiscal year ended September 30, 1997. Pro forma
fiscal year ended December 31, 1997 was determined by subtracting
Micronics' quarter ended December 31, 1996 from its reported fiscal year
results and then adding its quarter ended December 31, 1997 results.
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<TABLE>
<CAPTION>
UNAUDITED PRO FORMA CONSOLIDATED CONDENSED BALANCE SHEET
June 30, 1998
(In thousands, except per share amounts)
Diamond
Multimedia Micronics Pro Forma Pro Forma
Systems, Inc. Computers, Inc. Adjustments Consolidated
-------------------------------------------------------------
<S> <C> <C> <C> <C>
ASSETS
Current Assets:
Cash and short-term investments ............... $ 103,810 $ 11,400 $ -- $ 115,210
Accounts receivable ........................... 101,558 591 -- 102,149
Inventories ................................... 89,619 4,240 -- 93,859
Deferred income taxes and other current assets 29,835 942 -- 30,777
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Total current assets ....................... 324,822 17,173 -- 341,995
Property, plant and equipment, net ............ 22,101 4,249 4,025(1) 30,375
Goodwill and other intangibles, net ........... 9,553 -- 19,678(2) 29,231
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Total assets ............................... $ 356,476 $ 21,422 $ 23,703 $ 401,601
=========================================================
LIABILITIES
Current Liabilities:
Current portion of long-term debt ............. $ 49,954 $ -- $ -- $ 49,954
Trade accounts payable ........................ 92,944 7,867 0 100,811
Accrued liabilities ........................... 26,619 4,319 32,725(3) 63,663
Income taxes payable .......................... 0 145 0 145
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Total current liabilities .................. 169,517 12,331 32,725 214,573
Long term debt, net of current portion ........ 1,718 -- -- 1,718
Deferred taxes ................................ -- -- -- --
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Total liabilities .......................... 171,235 12,331 32,725 216,291
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STOCKHOLDERS' EQUITY
Paid-in capital .................................. 313,057 31,094 (31,094)(4) 313,057
Distributions in excess of net book value ........ (56,775) -- -- (56,775)
Accumulated deficit .............................. (71,041) (22,003) 22,003(4) (70,972)
-- -- 69(4) --
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Total stockholders' equity .................... 185,241 9,091 (9,022) 185,310
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Total liabilities and stockholders' equity . $ 356,476 $ 21,422 $ 23,703 $ 401,601
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</TABLE>
(1) Adjustment to recognize difference between fair market value of the
Micronics owned office building and net book value of the building.
(2) Adjustment to record goodwill of $19.7 million relating to the purchase
of Micronics. The purchase price allocation may change upon determination
of total purchase price and appraisal of the fair value of the net assets
acquired from Micronics.
(3) Adjustment to record the liability of the purchase price for Micronics.
Proceeds were paid in July 1998.
(4) To adjust stockholders' equity for the acquisition of Micronics.
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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.
DIAMOND MULTIMEDIA SYSTEMS, INC.
Dated: September 14, 1998 By: /s/ James M. Walker
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James M. Walker
Senior Vice President and
Chief Financial Officer
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