In the second quarter of 2000, pre-tax restructuring charges of $12.4 million reduced earnings per share by $0.08 to a reported $0.01 per share. Gross margin for the second quarter of 2001 was 43 percent compared to 41 percent for the second quarter of 2000. This margin increase reflects a stronger product mix and continued benefits obtained from operational efficiencies throughout the company.
We believe that the strategy we laid out last year emphasizing our superior virtual solutions and our leading tape offerings are clearly addressing the market’s needs. Customers know they need storage solutions that are both economically feasible and environmentally fitting. StorageTek is the only storage provider that can meet their business needs through a strong suite of solutions that include the benefit of virtualization, said Patrick Martin, StorageTek chairman, president and chief executive officer. The strong market acceptance this quarter of our virtual tape solution, the Virtual Storage Manager, is just one example that companies are embracing improvements to traditional storage solutions.
Revenue from our U.S./Canada direct sales channel was up 24% compared to the second quarter of 2000. We are beginning to see the pay-off from investments in our sales force. We have hired qualified sales people and they are having success in this difficult market, said Martin.
Financial highlights for the second quarter include a sound cash balance of $307 million, an increase of $59 million over last year’s second quarter balance of $248 million. We have and continue to achieve efficiencies in our attack to unleash trapped profitability, said Robert Kocol, StorageTek’s chief financial officer. The fundamentals of our business model are strong and there is a growing momentum within our company. We’re constantly taking decisive action so that we are able to take advantage of the inevitable rebound of the economy.
SOURCE: COMPANY PRESS RELEASE
