Creative Technology More Than Triples Third Quarter Earnings Year-Over-Year
Exceeds Expectations by Achieving Q3 EPS of 20 Cents
SINGAPORE, April 22 /PRNewswire-FirstCall/ -- Creative Technology Ltd. (Nasdaq: CREAF - news), the worldwide leader in digital entertainment products for users of the personal computer and the Internet, today announced financial results for the third quarter of fiscal year 2002, ended March 31, 2002. All financial results are stated in U.S. dollars.
Creative reported third quarter sales of $193.4 million, at the top end of the company's expectations for the period. Sales for the third quarter of the previous year were $262.0 million.
Third quarter net income of $15.1 million or $0.20 per share was more than triple the previous year's Q3 operating results which were net income of $4.6 million or 6 cents per share. The previous year's operating results for the same quarter exclude one-time charges of $31.0 million and write-down of investments of $75.4 million in that quarter.
Sales for the first nine months of fiscal year 2002 were $623.3 million, compared to $992.8 million for the same period last year. Net income excluding charges and write-downs for the first nine months of fiscal 2002 was $44.2 million or $0.59 per share, compared to net income before charges and write-downs of $46.6 million or $0.57 per share for the same period last year. Including charges and write-downs, net income for the first nine months of fiscal 2002 was $28.6 million or $0.38 per share, compared to a net loss of $56.9 million or $0.72 per share for the first nine months of the previous fiscal year.
``This was another solid quarter for Creative, as we came in at the high end of our revenue guidance, again achieved gross margins above 33%, and significantly reduced operating expenses. Such strong performance in each of these operational areas resulted in earnings of 20 cents per share, over 40% above our expectations,'' said Craig McHugh, president of Creative Labs, Inc. ``We also strengthened our balance sheet, growing cash to $196 million, which is an increase of 10% over the previous quarter, and of 36% over the same quarter last year. We reached a key milestone in the quarter with the adoption of the Creative's Sound Blaster® Audigy(TM) by Gateway, Inc. as a standard feature on its 700 Series PCs and as an upgrade option on its 500 Series PCs. We also had our first full quarter of volume shipments of our broadband digital modems to America Online. Another key accomplishment in the quarter was the announcement in March of our definitive agreement to acquire 3Dlabs, Inc., which we anticipate closing in this current fourth quarter.''
Hock Leow, Chief Technology Officer of Creative Technology noted, ``Based upon what we have now seen from the fully functioning prototype of 3Dlabs' highly anticipated programmable TeraOps visual processor, I believe that we will be able to rededicate our efforts to the consumer graphics market with an awesome product line under a business model that more closely resembles our very successful core audio businesses.''
``During the quarter, we shipped our first external Sound Blaster, the Sound Blaster Extigy(TM) and received exceptional reviews, including four out of four stars from USA Today, a five out of five from PC Magazine and 'Editor's Choice' awards from CNET and ZDNET,'' said Sim Wong Hoo, chairman and CEO of Creative Technology Ltd. ``We also announced the new NOMAD® Jukebox 3 last week, and have already been awarded an 'Editor's Choice' award from CNET. As we look forward to the next quarter and beyond, we will reinforce our leadership in digital audio with a new and exciting family of NOMAD hard-disk and flash-based digital audio players with unique form factors to address different lifestyle segments of the market. We will also be announcing, later this week, an exciting and revolutionary new product that will bring a new dimension to music entertainment, which I call interactive music entertainment. This product will also complement the superior audio quality of the Sound Blaster Audigy and Extigy.''
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