EX-99 3 pr.txt FINANCIAL PRESS RELEASE DATARAM PRESS RELEASE Dataram Contact: Investor Contact: Mark Maddocks, Joe Zappulla Chief Financial Officer Wall Street Investor Relations Corp. 609-799-0071 212-714-2445 info@dataram.com JZappulla@WallStreetIR.com DATARAM REPORTS FIRST QUARTER FINANCIAL RESULTS Company resumes stock repurchase program, reduces Long-Term Debt by $2.3 million PRINCETON, N.J. August 21, 2002 - Dataram Corporation (NASDAQ: DRAM) today reported its financial results for its fiscal first quarter ended July 31, 2002. Revenues for the first quarter were $14.3 million compared to $19.8 million in the prior quarter and $22.6 million for the same period of the previous year. As previously announced, the Company incurred restructuring charges, primarily severance, during the quarter of $740,000. The restructuring is projected to reduce costs by $2.5 million annually. Excluding the restructuring charge, the Company incurred a proforma loss (earnings before depreciation and amortization charges) of $79,000. This compares to a proforma loss of $442,000 or $0.05 per share in the prior quarter and proforma earnings of $745,000 or $0.09 per share in the first quarter of the prior fiscal year. The Company reported a GAAP net loss of $1.8 million or $0.21 per share for the first quarter of fiscal 2003 compared to a loss of $1.7 million or $0.20 per share in the prior quarter and $1.8 million or $0.21 per share in the first quarter of last fiscal year. (In 000's, except per share amounts) Fourth First Quarter Quarter FY2002 FY2003 FY2002 Revenues $19,801 $14,281 $22,570 Proforma net earnings (loss)(1) $(442) $(79) $745 Proforma EPS $(0.05) $(0.01) $0.09 Depreciation and amortization $1,275 $1,004 $1,306 Restructuring charges -- 740 1,200 Net loss $(1,717) $(1,823) $(1,761) EPS $(0.20) $(0.21) $(0.21) Shares 8,490 8,483 8,524 (1) Excludes non-cash depreciation and amortization and restructuring charges. Robert Tarantino, Dataram's president and CEO, stated, "We have endured a market that presented unprecedented challenges over the last fifteen months. During that time we reduced our operating costs by approximately $6.5 million per year, while still preserving our key sales and manufacturing resources. Although the extended market slowdown has adversely impacted the Company's revenue, we believe the worst of this market downturn is behind us. We are positioned to be successful during a period of slow economic recovery, while maintaining the operating leverage to dramatically increase earnings in an improving economy." Mark Maddocks, Dataram's chief financial officer added, "We have improved our financial condition. During the quarter, the Company paid down $2.3 million in long-term debt, while increasing cash and equivalents by $715,000. Since fiscal 2001 year-end, our bank debt and capital lease obligations have decreased from $15.1 million to the current level of $1.5 million. Also, in the first quarter, the Company resumed its open market stock repurchase activities purchasing 38,600 shares of its common stock in the quarter. The Company is continuing to repurchase its shares in the second quarter." Dataram recently announced the appointment of Lars Marcher to the position of chief operating officer. Mr. Marcher, who joined the Company in March 2001 after its acquisition of Memory Card Technology A/S, is an experienced global sales and marketing executive. He has held senior marketing management positions with a number of international firms, most notably of which is Apple Computer, Australia and has overseen sales and marketing efforts in Europe and the Pacific Rim. Mr. Tarantino commented on Mr. Marcher's promotion, "Lars' extensive background in international sales and marketing strengthens and deepens our management team. His contribution during this difficult market has been instrumental in positioning Dataram for long-term growth." In this year's first quarter, the Company entered into an agreement to sell its undeveloped land for a price of $3.0 million. While management expects the sale to close no later than 30 months from the date of contract, the agreement is subject to certain contingencies and as such may be terminated prior to closing. The land is carried at cost on the Company's balance sheet at a value of $875,000. The resulting gain on the sale will be recorded when all contingencies have been satisfied. Dataram will conduct a conference call at 11:00 a.m. (EDT) today to present its first quarter financial results and to respond to investor questions. Interested shareholders may participate in the call by dialing 800-207-3317 and providing the following reservation number: 20829809. It is recommended that participants call 10 minutes before the conference call is scheduled to begin. The conference call can also be accessed over the Internet through Vcall at www.vcall.com. A replay of the call will be available approximately one hour after the completion of the conference call through Vcall and for 24 hours by dialing 800-633-8284 or 402-977- 9140 and entering the reservation number listed above. ABOUT DATARAM CORPORATION Dataram Corporation, celebrating its 35th year in the computer industry, is a leading provider of computer memory. The Company offers a specialized line of gigabyte-class memory for entry- to enterprise-level servers, workstations and notebooks from Compaq, Dell, Fujitsu/Siemens, HP, IBM, Intel, SGI, Sun and Toshiba. Additional information is available on the Internet at www.dataram.com. Financial Tables Follow DATARAM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (Unaudited) Three Months Ended 7/31/2002 7/31/2001 Revenues $ 14,281 $ 22,570 Costs and expenses: Cost of sales 10,740 15,625 Engineering and development 381 594 Selling, general and administrative 4,537 6,056 Intangible asset amortization 0 297 Restructuring charges 740 1,200 ___________ __________ 16,398 23,772 Loss from operations (2,117) (1,202) Interest expense, net (44) (154) ___________ __________ Loss before income taxes (2,161) (1,356) Income tax provision (benefit) (338) 405 ___________ __________ Net loss $ (1,823) $ (1,761) =========== ========== Net loss per share: Basic $ (0.21) $ (0.21) =========== ========== Diluted $ (0.21) $ (0.21) =========== ========== Average number of shares outstanding: Basic 8,483 8,524 =========== ========== Diluted 8,483 8,524 =========== ========== DATARAM CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (Unaudited) July 31, 2002 April 30, 2002 _____________ ______________ ASSETS Current assets: Cash and cash equivalents $ 4,371 $ 3,656 Trade receivables, net 6,279 12,177 Inventories 4,466 5,435 Other current assets 1,148 532 _____________ ______________ Total current assets 16,264 21,800 Property and equipment, net 8,329 9,210 Goodwill 11,144 11,144 Other assets 439 408 _____________ ______________ $ 36,176 $ 42,562 ============= ============== LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 3,507 $ 6,600 Accrued liabilities 2,249 1,687 _____________ ______________ Total current liabilities 5,756 8,287 Deferred income taxes 646 647 Long-term debt 1,500 3,800 Stockholders' equity 28,274 29,828 _____________ ______________ $ 36,176 $ 42,562 ============= ============== The information provided in this press release may include forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. Actual results may differ from such projections and are subject to certain risks including, without limitation, risks arising from: changes in the price of memory chips, changes in the demand for memory systems, increased competition in the memory systems industry, delays in developing and commercializing new products and other factors described in the Company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission, which can be reviewed at http://www.sec.gov.