Privately-held Norcross, Georgia-based Hayes Microcomputer Products Inc, which has been trading under Chapter 11 protection since last November (CI No 2,480), has reported second quarter operating profits of $1.5m on sales of $65m, and is clearly on track for a solid recovery, according to Dennis Hayes, the company’s president and founder. The company previously reported first quarter profits of $442,000. Delivering on its promise to be more open about its fiscal condition (CI No 2,547), the company says it has experienced record sales during the last two quarters, with orders in excess of $74m for the second quarter, a company record. The orders reflect a 34% increase in year-to-year total unit shipments, and are in excess of 100% unit growth year-to-year for its PC Card and high-speed modems. Talking about the turnaround, Hayes said that the merger of its Practical Peripherals Inc unit with the parent company had had a significant impact, while inventories – a root cause of its problems – had been reduced by 22%, or $12m. Further, manufacturing improvements had allowed gross margins to be virtually restored to 1993 levels. The company has made great strides in strengthening its management team, improving capacity and reducing supply constraints, said Hayes, although he made no comment on when the company would seek discharge from bankruptcy.
