Feeds

Overland results show improvement

Not over the hill yet

  • alert
  • submit to reddit

High performance access to file storage

There's no need to call the grim reaper. Overland Storage's fourth quarter and full year 2009 results show it being nursed back to health.

Overland Storage makes ULTAMUS and REO data protection disk array and NEO tape automation products, plus Snap Server network-attached storage (NAS) products for mid-range and small enterprises.

There are three sets of figures that give the main picture: net revenues, net income/loss and operating expenses. Fourth quarter net revenues were $22.1m compared with $29m a year ago. The net loss was $2.7m, compared to $16.1m a year ago. Operating expenses were $8.2m, down from the year-ago quarter's $21.1m.

Full year 2009 revenues were $105.6m, down from fiscal 2008's $127.7m. The net loss was $18m compared to 2008's $32m. Full year operating expenses were $46m, lower than the previous year's $58.5m.

There are other figures such as branded product sales, gross margin and gross profit which we could look at but the essential picture is present already. Overland is still sickly, but is getting ready to think about leaving the intensive care ward.

In summary, although revenues were down - blame the recession - Overland has made great strides in cutting its costs and living within its means.

Newly-appointed CEO Eric Kelly said: "We are managing working capital very tightly, and through a combination of reduced inventories and prudent use of our accounts receivable financing arrangements, we were able to improve our cash position for the second consecutive quarter. We brought operating expenses down another 14.5 per cent this quarter compared to the preceding quarter, and expenses are now at their lowest level in more than seven years. These are all positive indicators of forward momentum."

Restructuring expense costs are largely behind it and attention is turning to squeezing more cost out of its internal operations - witness the appointment of Chris Gopal to run its supply chain - and getting every sales dollar it can find. Kelly has recruited Jillian Mansolf as VP for world-wide sales and marketing. Her job is to give hope and enthusiasm to Overland's sales team and channel partners and fine-tune the marketing efforts.

What about the future? Kelly had this to say: "With the assistance of existing and newly-identified technology partners, we are executing our product roadmap with the goal of bringing next-generation products to our customers. Additionally, we have set our sights on specific larger vertical and horizontal markets that have consistently posted, and continue to demonstrate the potential to post, the fastest growth rates in their respective sectors."

Right, and turning to his favourite product, the Snap Server: "A key element of Overland's strategy is to leverage the Snap Server brand, which over the past 10 years has become one of the most recognizable names in the midrange NAS market. The midrange storage market continues to be one of the fastest growing segments of the worldwide disk storage systems market and our intent is to be well-positioned when the economic recovery gains traction."

Survival and a return to basic health is the goal now. Growth is in the hands of the economic Gods who will end the recession and start a recovery. There is no wonder technology in Overland's labs which will kick-start the company. It's all graft, struggle and stepwise product, supply chain, sales and marketing improvements ahead.

There's the serious matter of a potential NASDAQ delisting due to an eroded share price and company valuation ahead. NASDAQ is easing its rules, and a reverse stock split can be used to drive the share price well up past the NASDAQ minimum. Overland knows it has to get more capital and has said it will seek to raise cash as soon as it can.

The accountants have appended a note to the accounts saying there is doubt about whether Overland can continue as a going concern. They did this last year as well. Kelly says Overland has enough cash resources for the next twelve months, unless something drastic happens, such as a renewed recession. For the time being, Overland Storage looks like it will stay around and get stronger over the next few months. The grim reaper can turn its attention elsewhere. ®

High performance access to file storage

More from The Register

next story
This time it's 'Personal': new Office 365 sub covers just two devices
Redmond also brings Office into Google's back yard
European Court of Justice rips up Data Retention Directive
Rules 'interfering' measure to be 'invalid'
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Cisco reps flog Whiptail's Invicta arrays against EMC and Pure
Storage reseller report reveals who's selling what
Bored with trading oil and gold? Why not flog some CLOUD servers?
Chicago Mercantile Exchange plans cloud spot exchange
Just what could be inside Dropbox's new 'Home For Life'?
Biz apps, messaging, photos, email, more storage – sorry, did you think there would be cake?
IT bods: How long does it take YOU to train up on new tech?
I'll leave my arrays to do the hard work, if you don't mind
prev story

Whitepapers

Securing web applications made simple and scalable
In this whitepaper learn how automated security testing can provide a simple and scalable way to protect your web applications.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
HP ArcSight ESM solution helps Finansbank
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Mobile application security study
Download this report to see the alarming realities regarding the sheer number of applications vulnerable to attack, as well as the most common and easily addressable vulnerability errors.