Scientific-Atlanta net up 31 percent on DVR demand

<p>Continued demand for digital video recorders pushed profit up 31 percent at Scientific-Atlanta Inc., a leading maker of cable set-top boxes and modems.</p><p>The company Thursday said its earnings for the fiscal first quarter ended Oct. 1 rose to $55.9 million, or 36 cents a share, matching the average forecast by analysts surveyed by Thomson First Call.</p><p>It earned $42.7 million, or 28 cents a share, in the same period last year.</p><p>Sales increased 14 percent to $452.7 million from $395.6 million a year earlier, but fell short of analysts' mean forecast of $461 million.</p><p>Scientific-Atlanta said demand for its DVRs remains strong, with 397,000 shipped during the quarter. The company also said it sold 416,000 cable modems, a record number for any quarter.</p><p>Gross margin in the first quarter was 36.6 percent of sales, down 0.6 percentage points from last year and 0.2 points from the second quarter, in part due to the continued demand for lower-margin DVRs. The company said lower selling prices in the quarter were partially offset by cost reductions and insurance proceeds related to a fire at a vendor's plant in fiscal 2004.</p><p>The company's backlog at the end of the quarter was $442.4 million, up 23 percent from a year earlier but down 11 percent from the previous quarter.</p><p>Shares of Scientific-Atlanta changed hands at $28.04 in extended trading, down 2 percent from their close of $28.67 in New York Stock Exchange trading.</p>

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