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Press release from PR Newswire

Western Digital® Announces Q3 Revenue Of $3.8 Billion And Non-GAAP Net Income Of $514 Million, Or $2.10 Per Share(1)

Wednesday, April 24, 2013

Western Digital® Announces Q3 Revenue Of $3.8 Billion And Non-GAAP Net Income Of $514 Million, Or $2.10 Per Share(1)

16:15 EDT Wednesday, April 24, 2013

IRVINE, Calif., April 24, 2013 /PRNewswire-FirstCall/ -- Western Digital® Corp. (NASDAQ: WDC) today reported revenue of $3.8 billion, hard-drive shipments of 60.2 million and net income of $391 million, or $1.60 per share for its third fiscal quarter ended Mar. 29, 2013. On a non-GAAP basis, net income was $514 million or $2.10 per share.1 In the year-ago quarter, the company reported revenue of $3.0 billion, net income of $483 million, or $1.96 per share, and shipped 44.2 million hard drives. Non-GAAP net income in the year-ago quarter was $619 million, or $2.52 per share.2

The company generated $727 million in cash from operations during the March quarter, ending with total cash and cash equivalents of $4.1 billion. During the quarter, the company utilized $243 million to buy back 5.2 million shares of common stock. On Feb. 14, the company declared a $0.25 per common share dividend, which was paid on Apr. 15.

"Strong execution by our HGST and WD subsidiaries drove outstanding results in the March quarter as we continue to capitalize on the secular growth of digital data," said Steve Milligan, president and chief executive officer. "Overall industry demand was in line with our expectations. In our business, we saw strength in enterprise, stable performance in client and consumer electronics, and some anticipated seasonal softness in Branded Products."

The investment community conference call to discuss these results will be broadcast live over the Internet today at 2 p.m. Pacific/5 p.m. Eastern. The live and archived conference call webcast can be accessed online at investor.wdc.com. The telephone replay number is 800-685-1235 in the U.S. or +1-203-369-3419 for international callers.

About Western Digital

Western Digital Corp. (NASDAQ: WDC), Irvine, Calif., is a global provider of products and services that empower people to create, manage, experience and preserve digital content. Its subsidiaries design and manufacture storage devices, networking equipment and home entertainment products under the WD®, HGST and G-Technology brands. Visit the Investor section of the company's website (www.westerndigital.com) to access a variety of financial and investor information.

This press release contains a forward-looking statement within the meaning of the Private Securities Litigation Reform Act of 1995 concerning the growth of digital data. This forward-looking statement is based on management's current expectations and is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statement, including the impact of continued uncertainty and volatility in global economic conditions; supply and demand conditions in the hard drive industry; uncertainties concerning the availability and cost of commodity materials and specialized product components; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products based on new technologies and expansion into new data storage markets; business conditions and growth in the various hard drive markets; pricing trends and fluctuations in average selling prices; and other risks and uncertainties listed in the company's filings with the Securities and Exchange Commission (the "SEC"), including the company's recent Form 10-Q filed with the SEC on Feb. 1, 2013, to which your attention is directed. Readers are cautioned not to place undue reliance on this forward-looking statement, which speaks only as of the date hereof, and the company undertakes no obligation to update this forward-looking statement to reflect subsequent events or circumstances.

Western Digital, WD and the WD logo are registered trademarks in the U.S. and other countries. Other marks may be mentioned herein that belong to other companies.

___________________________

1Non-GAAP net income for the third quarter fiscal 2013 consists of GAAP net income of $391 million plus $49 million of amortization of intangibles related to the acquisition of HGST and $74 million related to employee termination benefits and other unrelated charges. Non-GAAP earnings per share of $2.10 for the third quarter is calculated by using the same 245 million diluted shares as is used for GAAP earnings per share. The tax effect of the aforementioned items was not material.

2 Non-GAAP net income for the third quarter fiscal 2012 consists of GAAP net income of $483 million plus $103 million for costs recognized upon the sale of inventory that was written-up to fair value and amortization of intangibles related to the acquisition of HGST, $34 million of acquisition-related expenses and $15 million for charges and expenses related to the flooding net of recoveries, less $16 million of tax effects related to the aforementioned items. Non-GAAP earnings per share of $2.52 for the third quarter is calculated by using the same 246 million diluted shares as is used for GAAP earnings per share.  

 

 WESTERN DIGITAL CORPORATION 

CONDENSED CONSOLIDATED BALANCE SHEETS 

(in millions; unaudited)

Mar. 29,

Jun. 29,

2013

2012

ASSETS

Current assets:

Cash and cash equivalents

$     4,060

$     3,208

Accounts receivable, net

1,700

2,364

Inventories

1,197

1,210

Other

383

359

Total current assets

7,340

7,141

Property, plant and equipment, net

3,803

4,067

Goodwill 

1,954

1,975

Other intangible assets, net

656

799

Other assets

174

224

Total assets

$   13,927

$   14,206

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Accounts payable

$     2,037

$     2,773

Accrued expenses

837

858

Accrued warranty

122

171

Current portion of long-term debt

230

230

Total current liabilities

3,226

4,032

Long-term debt

1,783

1,955

Other liabilities

495

550

Total liabilities

5,504

6,537

Total shareholders' equity

8,423

7,669

Total liabilities and shareholders' equity

$   13,927

$   14,206

 

     WESTERN DIGITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME 

     (in millions, except per share amounts)

     (unaudited)

Three Months Ended

Nine Months Ended

 Mar. 29, 

 Mar. 30, 

 Mar. 29, 

 Mar. 30, 

2013

2012

2013

2012

Revenue, net

$     3,764

$     3,035

$   11,623

$     7,724

Cost of revenue

2,703

2,058

8,310

5,558

Gross profit

1,061

977

3,313

2,166

Operating expenses:

Research and development

396

265

1,170

649

Selling, general and administrative

185

155

526

340

Employee termination benefits and other charges

63

 ? 

130

 ? 

Charges related to flooding, net

 ? 

15

 ? 

214

Total operating expenses

644

435

1,826

1,203

Operating income 

417

542

1,487

963

Net interest and other

(11)

(4)

(35)

(8)

Income before income taxes

406

538

1,452

955

Income tax provision

15

55

207

88

Net income 

$        391

$        483

$     1,245

$        867

Income per common share:

Basic

$       1.64

$       2.00

$       5.14

$       3.67

Diluted

$       1.60

$       1.96

$       5.02

$       3.61

Weighted average shares outstanding:

Basic

239

241

242

236

Diluted

245

246

248

240

 

     WESTERN DIGITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

     (in millions; unaudited)

Three Months Ended

Nine Months Ended

 Mar. 29, 

 Mar. 30, 

 Mar. 29, 

 Mar. 30, 

2013

2012

2013

2012

Cash flows from operating activities

Net income 

$        391

$        483

$     1,245

$        867

Adjustments to reconcile net income to net cash 

  provided by operations:

Depreciation and amortization

309

188

931

486

Stock-based compensation

36

20

107

61

Deferred income taxes

(9)

24

59

42

Non-cash portion of employee termination benefits 

    and other charges

1

 ? 

16

 ? 

Non-cash portion of charges related to flooding

 ? 

10

 ? 

119

Changes in operating assets and liabilities, net

(1)

483

77

363

Net cash provided by operating activities

727

1,208

2,435

1,938

Cash flows from investing activities

Purchases of property, plant and equipment

(188)

(139)

(816)

(393)

Acquisitions, net

26

(3,541)

(1)

(3,541)

Purchase of investments

(2)

 ? 

(17)

 ? 

Net cash used in investing activities

(164)

(3,680)

(834)

(3,934)

Cash flows from financing activities

Employee stock plans, net

39

29

152

49

Repurchases of common stock

(243)

 ? 

(607)

 ? 

Dividends to shareholders

 ? 

 ? 

(121)

 ? 

Proceeds from debt, net of issuance costs

 ? 

2,775

 ? 

2,775

Repayment of assumed debt

 ? 

(585)

 ? 

(585)

Repayment of debt

(115)

(288)

(173)

(350)

Net cash provided by (used in) financing activities 

(319)

1,931

(749)

1,889

Effect of exchange rate changes on cash

 ? 

(6)

 ? 

(6)

Net increase (decrease) in cash and cash equivalents

244

(547)

852

(113)

Cash and cash equivalents, beginning of period

3,816

3,924

3,208

3,490

Cash and cash equivalents, end of period

$     4,060

$     3,377

$     4,060

$     3,377

(Logo:  http://photos.prnewswire.com/prnh/20000711/WDCLOGO)

 

 

SOURCE Western Digital Corp.

For further information: Bob Blair, Western Digital Investor Relations, 949.672.7834, robert.blair@wdc.com, or Steve Shattuck, Western Digital Public Relations, 949.672.7817, steve.shattuck@wdc.com

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