On Feb. 26, storage networking expert Brocade Communications Systems
- The sales and profit gains are impressive and mostly organic. The results do include a pair of small acquisitions, but nothing material to this quarter's revenues.
- Right at the close of this period, Brocade closed the very significant McDATA acquisition, though. In last year's April quarter, that company pulled in $168 million in revenues, making a $9.5 million loss.
- It's a strategic deal, though. McDATA brings a significant range of new products to the table, and the combined company should be better-equipped to compete with storage networking giants like EMC
(NYSE:EMC) and Cisco(NASDAQ:CSCO) and put pressure on smaller competitors like QLogic(NASDAQ:QLGC) and Emulex(NYSE:ELX) . - Brocade has a mediocre two-star Motley Fool CAPS rating right now. Is that too harsh, or perhaps too generous? Log in right now and let us know what you think.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Sales |
$224.2 |
$170.1 |
31.8% |
|
Net Profit |
$33.3 |
$9.7 |
244.9% |
|
EPS |
$0.12 |
$0.04 |
200.0% |
|
Diluted Shares |
285.1 |
272.1 |
4.8% |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q1 2007 |
Q1 2006 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
63.1% |
59.2% |
3.9 |
|
Operating Margin |
17.6% |
7.2% |
10.4 |
|
Net Margin |
14.9% |
5.7% |
9.2 |
Margins are the earnings engine. See how they work.
Balance Sheet Highlights
|
Assets |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$569.1 |
$450.3 |
26.4% |
|
Accounts Rec. |
$94.6 |
$76.2 |
24.2% |
|
Inventory |
$10.2 |
$8.2 |
25.2% |
|
Liabilities |
Q1 2007 |
Q1 2006 |
Change |
|---|---|---|---|
|
Accounts Payable |
$55.8 |
$28.0 |
99.1% |
|
Long-Term Debt |
$0.0 |
$0.0 |
N/A |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$33.3 |
$32.0 |
4.0% |
|
Capital Expenditures |
$13.4 |
$8.2 |
63.5% |
|
Free Cash Flow |
$20.0 |
$23.9 |
(16.3%) |
|
$45.9 |
$26.1 |
76.1% |
Find out why Fools always follow the money.
Cash Conversion Checkup
|
Q1 2007 |
Q1 2006 |
Change |
|
|---|---|---|---|
|
Days in Inventory |
10.4 |
12.4 |
(2.0) |
|
Days in Receivables |
38.7 |
38.7 |
0.0 |
|
Days Payables Outstanding |
61.2 |
33.6 |
27.6 |
|
Cash Conversion Cycle |
(12.0) |
17.5 |
(29.6) |
Read up on cash conversion metrics.
Related Foolishness:
- Brocade's Train Wreck
- SEC's Positively Foolish Option Accounting Rules
- Trying to Be Young Again
- Foolish Fundamentals: Free Cash Flow
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Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
At the time of publication, Anders Bylund had no position in any company mentioned -- not that he'd mind owning some of them, if he could only stop writing about them long enough to place a trade. Fool rules can be a harsh mistress sometimes.
