Lexar Media First Quarter Report Meets Expectations
Friday, April 27, 2001
FREMONT, Calif., April 25, 2001 - Lexar Media, Inc. (NSDQ: LEXR), a leading designer, developer and marketer of award-winning high-performance digital film and connectivity products for the digital photography market, today reported revenues for the first quarter ended March 31, 2001. Total revenues for the first quarter 2001 were $16.2 million, a nominal increase over the $16.1 million in revenues reported for the first quarter of the previous year. The Company's revenues for the first quarter 2001 were essentially flat from revenues reported in the fourth quarter of 2000. Excluding stock-based compensation charges, imputed interest, financing charges and a one-time $2.9 million write down of unamortized goodwill related to the purchase of Printroom in January 2000, Lexar Media's pro forma loss was $18.0 million for the first quarter of 2001, or $0.31 per share, compared to a pro forma loss of $12.5 million, or $0.22 per share, for the fourth quarter of 2000, and $4.4 million, or $0.53 per share for the first quarter of 2000. Including stock-based compensation charges, imputed interest, financing charges, and a one-time charge related to the remaining Printroom acquisition goodwill, Lexar Media's loss was $23.5 million, or $0.41 cents per share, for the first quarter ended March 31, 2001, compared to a loss of $20.9 million, or$0.37 cents per share, for the fourth quarter ended December 31, 2000, and a loss of $8.3 million, or $1.01 per share, for the first quarter ended March 31, 2000. "We are pleased with our results during the first quarter in which, as expected, Lexar Media not only achieved revenues that were slightly improved over the previous quarter, but also attained a significant decrease in cash burn," said John Reimer, Lexar Media's President and Chief Executive Officer. "The Company was also successful in decreasing inventory, as we experienced a significant increase in shipments compared to the fourth quarter of 2000." Mr. Reimer added, "Last year, Lexar Media announced a global technology licensing strategy to protect our patent portfolio and to allow sales of our proprietary controller technology to partners to address strategic opportunities. We began executing this strategy in the first quarter, leading up to our recently announced licensing agreement with Samsung Electronics whereby Lexar Media will collect significant royalty payments that have started in the second quarter of 2001. The signing of this agreement is a recognition of Lexar Media's technology as a growth driver for the flash media industry." Commenting on Lexar Media's balance sheet, Ron Bissinger, Vice President and Chief Financial Officer, stated, "We reduced inventory levels to $15.7 million at the end of the first quarter. This $11.9 million reduction since December 31, 2000 was primarily accomplished through stricter inventory control, cost reductions, and by increasing our inventory reserves to reflect current market conditions. We ended the quarter where we expected to be with regard to our cash position at $22.1 million in cash and short-term investments. We continue to believe that this is sufficient to achieve our fourth quarter profitability goal." Mr. Bissinger continued, "We expect that licensing and controller sales revenue for 2001 will increase from the previously projected $3 million to more than $12 million based on our agreement with Samsung Electronics and other anticipated agreements that we plan to announce in the near future."