Hayes Microcomputer Products Reports Profitable Quarter After Chapter 11 Filing

Hayes Microcomputer Products, Inc., a leading manufacturer of computer communications equipment and software, reported a profitable quarter after emerging from Chapter 11 bankruptcy proceedings. The company's turnaround efforts, implemented last summer, resulted in net profits of approximately $442,000 on sales of $68.9 million during the first quarter of FY 1995. This represents a 19.8% increase in sales from $57.6 million for the same period last year, following losses of $13 million in FY 1994.

Key Takeaways:

• Hayes Microcomputer Products reported a profitable quarter, with net profits of approximately $442,000, after implementing turnaround efforts last summer.
• Sales increased by 19.8% to $68.9 million, up from $57.6 million for the same period last year.
• The company's bad debt history of less than 1% is "tops in the industry," according to Holly Etlin, a partner with Deloitte Touche.
• The change in customer payment terms is expected to steadily improve, with immediate pay discounts taken by 13% in early December increasing to 15% by the end of the year.
• Sales bookings and backlogs reached record levels, and the company has been working closely with customers to minimize potential stock-out situations.
• Hayes Microcomputer Products has a strong brand presence, with the strongest showing in the desktop modem and PCMCIA categories in the "ComputerWorld I/S Brand Preference Study."

Statistics:

• Net profits: approximately $442,000
• Sales: $68.9 million (up 19.8% from $57.6 million last year)
• Losses in FY 1994: $13 million
• Bad debt history: less than 1%
• Customer payment terms: immediate pay discounts taken by 16% (up from 13% in early December)
• Sales bookings and backlogs: reached record levels
• Number of countries where Hayes Microcomputer Products distributes its products: over 65

Sources:

• PRNewswire, January 18, 1995
• "ComputerWorld I/S Brand Preference Study" (third annual)