Dot Hill Expects Revenue, EPS to be Higher than Expected for 2003

5/8/2003 - Dot Hill Systems Corp. (AMEX:HIL), announced it has increased its earlier revenue and EPS guidance for the remaining quarters of 2003, following encouraging revenue figures for the first quarter of 2003. The company is targeting annual net revenue for the year 2003 at the $171.5 million level, up 12 percent from the $153.0 million previously targeted. Further, the company projects its fully diluted annual earnings per share (EPS) for the year 2003 at $0.21 versus the $0.17 previously targeted.

“Our SANnet® II Fibre Channel product has been extremely well received by our customers and is expected to be an integral part of our future revenue stream,” said James Lambert, president and CEO of Dot Hill. “In addition, we have received increased product forecasts from our OEM customers.”

“We greatly exceeded our financial goals for the first quarter of 2003 with net revenue increasing to $30.5 million and EPS of a $0.06 loss, as compared to our guidance of revenue at $22.0 million and EPS of a $0.10 loss,” said Preston Romm, Dot Hill's chief financial officer. “In light of our customers’ increased product forecasts and the general enthusiasm for our products in the market, we determined it was appropriate to increase our guidance figures for the remainder of the year. The new EPS takes into account the additional 1.8 million shares of common stock issued last week upon conversion of the preferred stock, as well as the 4.75 million shares of common stock issued in our March 2003 PIPE transaction. These additional shares have the affect of diluting our revised targeted quarterly and year-end EPS numbers, although targeted net income for each period has increased proportionately with the corresponding increases in our targeted net revenues.”

Dot Hill’s guidance for 2003 is annual net revenue at $171.5 million and fully diluted EPS of $0.21, with quarterly net revenue and fully diluted EPS targets.

Dot Hill Systems Corp. is a leader in the innovative design and delivery of storage networking solutions to businesses worldwide. Its products include the SANnet II family of storage systems. For more information, visit Dot Hill on the web at

Dot Hill, the Dot Hill logo, SANnet, SANscape, and SANpath and are trademarks of Dot Hill Systems Corp.

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