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[12:52 PM]
Mac Mail Order Powerhouse Sees 114% Growth In Mac CPU Unit Sales
Zones International, the parent company of MacZone, has announced a profitable quarter and generally excellent results. Those results include a marked growth in Mac CPU unit sales and a healthy increase in overall Mac sales. While Mac CPU sales grew by a larger percentage than their PC counterparts 114% vs. 47% respectively, overall Mac sales grew at a slower pace than overall Wintel sales, 12.9% vs 22.6% respectively. Here are the numbers according to Zones International:

Domestic PC/Wintel sales increased 22.6% to $58.5 million during the first quarter, primarily on the strength of CPU sales, which grew 48% in sales and 47% in units over the first quarter of 1998. PC/Wintel sales comprise 50.1% of total Domestic net sales. Macintosh sales increased 12.9% to $58.4 million during the first quarter, mostly on the sales strength of Apple Computer's innovative iMac. Mac CPUs grew 62% in sales and 114% in units over the first quarter of 1998. CPU sales represented 40.1% of total Domestic net sales during the quarter, with Hardware and Software totaling 44.6% and 15.3% of sales, respectively.

Domestic gross profit margin was 10.5% during the first quarter, down from 11.4% in the prior year quarter. The principal reason for the margin decline is aggressive pricing strategies for certain CPUs and Hardware items. Additionally, the overall CPU mix grew from 29.6% of sales last year to 40.1% presently.

Cash levels at March 31, 1999 were $15.0 million, up from $6.8 million at March 31, 1998 and down from $19.1 million at December 31, 1998. The Company also has unused credit lines, with major financial institutions, of $35 million. Net inventory was $30.4 million at March 31, 1999, down from $33.5 million at December 31, 1998. Inventory turns, a measure of asset productivity, were 15.3 times in the quarter, up from 10.8 times in the first quarter of 1998 and even with the fourth quarter of 1998.

The Mac Observer Spin: Zones International is certainly a healthy company. It is great to see Mac sales rising so fast, though it would be nice to see them start to eclipse PC sales. This is not likely for a while, though the introduction of the P1, Lombard, and the possible MacMate coulds certainly make it possible later this year.

As we said in our article about MacAddict's growth, good news is becoming so common, it might become boring! :-)

MacZone



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