Seagate Technology Announces Second Fiscal Quarter 2003 Results

Seagate Technology (NYSE:STX)(the "Company"), today reported record shipments of 18.3 million disc drives for the second quarter of its fiscal year 2003. The Company reported consolidated revenue of $1.734 billion, net income of $198 million and diluted net income per share of $0.43 for its quarter ended December 27, 2002.

"Our results reflect solid execution and continued market leadership, and are attributable to the efforts of every employee at Seagate," said Steve Luczo, Seagate's chief executive officer. "It is important to understand that this performance is the direct result of the multiple investments in people, process and technology that we've made over the last few years. We remain committed to investing in product development and operational efficiency programs that will further strengthen our position."

For the year-ago quarter ended December 28, 2001, consolidated revenue was $1.629 billion, net income was $124 million and diluted net income per share was $0.31.

A conference call will take place today at 2:00 PM Pacific Time, to discuss the second quarter results. The live, public webcast of the conference call can be accessed from www.seagate.com.

A replay will be available beginning at 5:30 PM Pacific Time today, running through January 16 at 11:59 PM Pacific Time. The replay can be accessed from www.seagate.com or by telephone as follows:

USA: 800-475-6701
International: 320-365-3844
Access code: 667693

About Seagate

Seagate is the worldwide leader in the design, manufacturing and marketing of hard disc drives for Enterprise, PC and Consumer Electronics applications. The Company is committed to delivering award-winning products, customer support and reliability, to meet the world's growing demand for information storage. Seagate can be found around the globe and at www.seagate.com.

 

 

 

		Three Months Ended							Six Months Ended
Statement of Operations Data		Dec. 27, 2002			Dec. 28, 2001				Dec. 27, 2002			Dec. 28, 2001
Revenue		$	1,734		$	1,629			$	3,313		$	2,923
Gross profit		$	493		$	437			$	865		$	735
As a percent of revenue			28.4	%		26.8	%			26.1	%		25.1	%
Income before income taxes		$	202		$	149			$	316		$	189
Provision for income taxes		$	4		$	25			$	8		$	31
Net income:
	Amount	$	198		$	124			$	308		$	158
	As a percent of revenue		11.4	%		7.6	%			9.3	%		5.4	%
Net income per share:
	Basic	$	0.49		$	0.31			$	0.76		$	0.40
	Diluted		0.43			0.31				0.67			0.40
Number of shares used in per share calculations:
	Basic		408			400				405			400
	Diluted		463			400				459			400

Balance Sheet Data	Dec. 27, 2002			Dec. 28, 2001
Cash, Cash Equivalents and Short-term Investments	$	974		$	915
Accounts Receivable, net	$	628		$	686
Days Sales Outstanding		33			38
Inventories	$	310		$	305
Inventory Turns		16.0			15.6
Capital Expenditures (3 months)	$	123		$	130

For further information, contact:

Rod Cooper, Investor Relations
Brian Ziel, Media Relations

Seagate Technology
920 Disc Drive
Scotts Valley, CA 95066
831-438-6550

		Three Months Ended							Six Months Ended
		Dec. 27, 2002			Dec. 28, 2001				Dec. 27, 2002			Dec. 28, 2001
Revenue		$	1,734		$	1,629			$	3,313		$	2,923
Cost of revenue			1,241			1,192				2,448			2,188
Product development			169			164				329			315
Marketing and administrative			105			109				191			205
Amortization of intangibles						5							10
Restructuring										7
	Total Operating Expenses	$	1,515		$	1,470			$	2,975		$	2,718
Income from operations		$	219		$	159			$	338		$	205
Interest income			4			6				8			15
Interest expense			(12)			(19)				(25)			(42)
Other, net			(9)			3				(5)			11
	Other Income (Expense), net	$	(17)		$	(10)			$	(22)		$	(16)
Income before income taxes		$	202		$	149			$	316		$	189
Provision for income taxes			4			25				8			31
Net income		$	198		$	124			$	308		$	158
Net income per share:
	Basic	$	0.49		$	0.31			$	0.76		$	0.40
	Diluted		0.43			0.31				0.67			0.40
Number of shares used in per share calculations:
	Basic		408			400				405			400
	Diluted		463			400				459			400

			Dec. 27, 2002			June 28, 2002
Assets
	Cash and cash equivalents		$	622		$	612
	Short-term investments			352			231
	Accounts receivable, net			628			614
	Inventories			310			347
	Other current assets			166			158
		Total Current Assets		2,078			1,962
	Property, equipment and leasehold improvements, net			1,025			1,022
	Intangible assets, net			5			6
	Other assets, net			113			105
		Total Assets	$	3,221		$	3,095
Liabilities and Shareholders' Equity
	Accounts payable		$	718		$	743
	Affiliate accounts payable			12			12
	Accrued employee compensation			164			190
	Accrued deferred compensation						147
	Accrued expenses			326			339
	Accrued income taxes			179			170
	Current portion of long-term debt			4			2
		Total Current Liabilities	$	1,403		$	1,603
	Other liabilities			98			102
	Long-term debt, less current portion			747			749
		Total Liabilities	$	2,248		$	2,454
		Shareholders' Equity	$	973		$	641
	Total Liabilities and Shareholders' Equity		$	3,221		$	3,095