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Wednesday, August 5, 1998

Cisco Reports Strong Fourth Quarter, Stock Split

gainst the backdrop of yesterday's market tumble, Cisco Systems yesterday reported positive fourth quarter and year-end results and a three-for-two stock split.

For the fourth quarter ended July 25, Cisco reported income of $492 million or $0.45 share, which included included a one-time charge of $48 million for the acquisition of Class Data Systems. Before the charge, earnings per share were $0.48, just ahead of analysts' consensus estimates of $0.47 per share. Fourth-quarter income At $2.4 billion, net sales for the quarter increased 35% over last year's fourth-quarter sales of $1.8 billion.

The networking company reported fiscal 1998 revenues of $8.5 billion, a 31% increase over fiscal 1997. Net income for the year was up 29% to $1.4 billion or $1.26 per share, from last year's $1.05 billion or $1.01 per share.

Along with the financial report came news that the company's board of directors had authorized a three-for-two stock split, effective Aug. 14. This split is the seventh Cisco has had since going public in 1991.

Cisco CEO John Chambers said in a prepared statement that although this was Cisco's 34th consecutive quarter of revenue growth, these results are especially pleasing given the economic crisis in Asia. Chambers attributed the company's financial success to advances in end-to-end Internet solutions to the enterprise, small, and medium businesses, and service providers.

Despite the good news, Cisco stock closed yesterday down 3.375 to 93.13.

--Eileen Colkin