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FYI - EMC Reports Third Quarter Results, Accelerating Growth And Improving Profitability

  • 17 October, 2003 12:09

<p>The following is a US release that crossed the wires overnight announcing EMC's third quarter results. If you would like to speak to an EMC spokesperson, please contact Debbie Sassine on 02 9954 3299.</p>
<p>FOR IMMEDIATE RELEASE</p>
<p>EMC REPORTS THIRD QUARTER RESULTS, ACCELERATING GROWTH AND
IMPROVING PROFITABILITY</p>
<p>Revenue Up 20 Per Cent Year Over Year As Customers Continue to Embrace New Products</p>
<p>HOPKINTON, Mass. - October 16, 2003 - EMC Corporation (NYSE:EMC) today reported financial results for the third quarter of 2003, reflecting balanced double-digit growth across all major business segments and improved profitability.</p>
<p>Total consolidated revenue for the third quarter was US$1.51 billion, 20 per cent higher than the US$1.26 billion reported for the third quarter of 2002. Net income for the third quarter was US$159 million or US$.07 per diluted share, including a US$.02 benefit resulting from the favourable resolution of certain tax audits. This compares with net income of US$21 million or US$.01 per diluted share for the third quarter of 2002.</p>
<p>Joe Tucci, EMC’s President and CEO, said, “We are pleased that our third-quarter results reflect strong customer acceptance of EMC’s comprehensive lineup of automated networked storage solutions. We are on track to achieve double-digit growth for the year, which not many large technology companies will do in this challenging economic environment. With 11 per cent revenue growth for the first nine months of 2003 compared with the same period in 2002, it is clear that we continue to gain market share and extend EMC’s lead as the world’s #1 provider of information storage solutions.”</p>
<p>Tucci continued, “With Tuesday’s announcement of our agreement to acquire Documentum and the pending completion of our acquisition of LEGATO, two complementary leaders in information management software, we are making the strategic moves necessary to enable our customers to manage all of their information according to its value to the business at every stage of its life, at the lowest total cost - creating the ultimate information lifecycle management company.”</p>
<p>EMC’s revenue growth was balanced across all major segments of its business. In particular, information storage software revenue grew to 23 per cent of the company’s total revenue, driven by demand for replication, multi-platform management and content-addressed storage (CAS) software. Information storage systems revenue also had strong double-digit growth on a year-to-year basis, led by EMC’s new Symmetrix DMX and CLARiiON CX networked information storage systems. Double-digit revenue growth in information storage services was spurred by strong customer demand for EMC’s storage-focused professional services.</p>
<p>Bill Teuber, EMC’s Executive Vice President and Chief Financial Officer, said, “The blend of new products and crisp execution across the entire organisation enabled EMC to turn in strong top- and bottom-line results in what is traditionally the most challenging quarter of the year. We enhanced our balance sheet by growing cash and investments by almost US$130 million to nearly US$6.2 billion during the quarter, while buying back nearly US$100 million worth of the company’s stock.”</p>
<p>EMC’s rapid delivery of new products continued in the third quarter. Highlights include the unveiling of the next major wave of Symmetrix DMX systems, software and related technologies, including the new Symmetrix DMX3000, an entry-level Symmetrix DMX800 configuration, new advanced replication technology, native iSCSI connectivity and enhanced functionality for mainframe customers; the extension of EMC CLARiiON’s functional leadership through major enhancements to EMC Navisphere, EMC SnapView and EMC SAN Copy software; the strengthening of EMC’s open software portfolio with the addition of powerful new VisualSRM and VisualSAN software for small-and medium-sized organisations; and the introduction of EMC OpenScale, the world’s first automated ‘pay as you go’ billing for storage infrastructure.</p>
<p>EMC continued to extend its market reach in the third quarter by announcing its agreement to acquire LEGATO Systems, Inc., and create the world’s most comprehensive portfolio of information storage software; partnering with BMC Software, the first independent software provider to resell EMC ControlCenter storage management software; and broadening its relationship with Oracle Corporation to include a new joint service available to help customers easily deploy Oracle® Database with EMC network attached storage (NAS) technology.</p>
<p>Business Outlook
The following statements are based on current expectations. These statements assume the acquisition of LEGATO Systems, Inc., closes on or about October 20, 2003, and the acquisition of Documentum, Inc., closes at the beginning of January 2004. These statements are forward-looking, and actual results may differ materially. These statements do not include the potential impact of any mergers, acquisitions, divestitures or business combinations that may be completed after the date hereof, except for the planned acquisitions of LEGATO Systems, Inc., and Documentum, Inc.</p>
<p>· Revenue in the fourth quarter of 2003 is expected to be between US$1.74 billion and US$1.78 billion;
· Earnings per share for the fourth quarter of 2003 are expected to be US$.05 per diluted share including in-process R&amp;D charges and other integration costs associated with the acquisition of LEGATO. These charges are expected to be US$.02 per diluted share;
· EMC expects software license revenues to represent 26 per cent of total revenues for 2004 and 27 per cent of total revenues exiting the fourth quarter of 2004;
· EMC expects the acquisition of Documentum to dilute first quarter 2004 diluted earnings per share by US$.02 per share, not to have any material impact to diluted earnings per share for the remainder of 2004 and to be slightly accretive to diluted earnings per share in 2005.</p>
<p>About EMC
EMC Corporation (NYSE: EMC) is the world leader in information storage systems, software, networks and services, providing automated networked storage solutions to help organisations get the maximum value from their information, at the lowest total cost, across every point in the information lifecycle. Information about EMC's products and services can be found at www.EMC.com.</p>
<p>Please note - consolidated statements of operations and other financial data are available on request. Please contact Casey Walton at caseyw@spectrumcomms.com.au</p>
<p>This release contains “forward-looking statements” as defined under the Federal Securities Laws. Actual results could differ materially from those projected in the forward-looking statements as a result of certain risk factors, including but not limited to: (i) risks associated with strategic investments and acquisitions, including the challenges and costs of closing, integration, restructuring and achieving anticipated synergies associated with the announced plans to acquire LEGATO Systems, Inc. and Documentum, Inc; (ii) adverse changes in general economic or market conditions; (iii) delays or reductions in information technology spending; (iv) the transition to new products, the uncertainty of customer acceptance of new product offerings, and rapid technological and market change; (v) insufficient, excess or obsolete inventory; (vi) competitive factors, including but not limited to pricing pressures; (vii) component quality and availability; (viii) the relative and varying rates of product price and component cost declines and the volume and mixture of product and services revenues; (ix) war or acts of terrorism; (x) the ability to attract and retain highly qualified employees; (xi) fluctuating currency exchange rates; and (xii) other one-time events and other important factors disclosed previously and from time to time in EMC’s filings with the U.S. Securities and Exchange Commission. EMC disclaims any obligation to update any such-forward looking statements after the date of this release.</p>
<p>For further information, please contact:
Emma Rogers
EMC Corporation
Tel: 02 9925 7942
Mob: 0408 237 309
Email: rogers_emma@emc.com</p>
<p>Debbie Sassine/Catherine Smith
Spectrum Communications
Tel: 02 9954 3299
Mob: 0405 735 323
email: debbies@spectrumcomms.com.au or
catherines@spectrumcomms.com.au</p>

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