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Cabletron may post loss
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March 2, 1998: 6:33 p.m. ET
Networking company suffered from sales shortfall, integration problems
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NEW YORK (CNNfn) - Cabletron Systems Inc., the fourth-largest networking products company, expects to report break-even results or perhaps "a small loss" for its fiscal fourth quarter.
Analysts had expected profits of as much as 16 cents a share, according to First Call.
The Rochester, N.H.-based company said it expects revenues for its fourth quarter of fiscal 1998 to be in the range of $305 million to $320 million which compares to $380.6 million for the fourth quarter of fiscal 1997.
But in addition to the sales shortfall, the company also said it plans to take a series of one-time charges in order to integrate Digital Equipment Corp.'s Network Product Business, which was purchased in November for $430 million.
Cabletron said it expects to record pretax non-recurring charges totaling $420 million for the Digital Network Products Business. That translates into $255.2 million after taxes, or $1.61 a share on a fully diluted basis.
In addition to the charges and shortfall, operations were also adversely affected margin pressure due to lower volume and pricing.
Cabletron expects to release final results for the fourth fiscal quarter on March 30.
Shares of Cabletron (CS) were plummeting in after-hours trading, dropping 2-1/4 to 13-1/4.
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Cabletron
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