Enterasys confirms revenue outlook

CIOL Bureau
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ROCHESTER, New Hampshire: Computer network equipment maker Enterasys Networks Inc. reaffirmed Thursday it expects to report third-quarter revenue of $120 million and said its cash usage should be one-third that of the previous quarter.

For the third fiscal quarter ended September 28, the company said its cash usage was about $25 million compared with $75 million, excluding income tax refunds, in the preceding quarter. It said fourth-quarter cash usage will be even lower.

Enterasys said it had cash and marketable securities totaling about $270 million at the end of its third quarter, which is expected to be enough to meet its needs. It expects federal income tax refunds of about $30 million in the first half of 2003.

The Rochester, New Hampshire-based company said it will talk with preferred stockholders which have the right to redeem all of their stock for about $90 million to $100 million at any time on or after February 23, 2003.

Enterasys' chairman and two other top executives resigned in April after revenue recognition irregularities were discovered in the Asia Pacific region. The company said it has completed its internal review and expects to file a 10-K with federal regulators soon for the 10-month period ended December 29, 2001.

(C) Reuters Ltd.