EX-99.1 2 rimage080734_ex99-1.htm PRESS RELEASE ISSUED ON FEBRUARY 20, 2008 Exhibit 99.1 to Rimage Corporation Form 8-K dated February 19, 2008

Exhibit 99.1

 

Rimage Reports Record Revenues and Earnings in 2007

Additional 500,000 Share Repurchase Authorized

 

Minneapolis, MN—February 20, 2008—Rimage Corporation (Nasdaq: RIMG) today reported revenues of $108,874,000 for the year ended December 31, 2007, up from $103,252,000 in 2006. Net income was $15,761,000 or $1.52 per diluted share, up 20% from $13,084,000 or $1.26 per diluted share in 2006.

 

For the fourth quarter of 2007, sales were $28,212,000, compared to $30,519,000 in the year-earlier period. Fourth quarter earnings were $4,515,000 or $0.45 per diluted share, up 25% from $3,625,000 or $0.34 per diluted share in the fourth quarter of 2006.

 

Rimage’s Board of Directors today issued a 500,000 share repurchase authorization, which is in addition to the previous 500,000 share buyback authorization. Since no shares were acquired in the fourth quarter of 2007 under the prior authorization, a total of 1,000,000 shares are now available for repurchase. Under both authorizations, shares can be purchased at prevailing market prices in the open market or in private transactions, subject to market conditions, share price, trading volume and other factors. This program can be discontinued at any time.

 

Bernard P. (Bernie) Aldrich, president and chief executive officer, commented: “Rimage’s fourth quarter sales were generated primarily by our global distribution channel. As expected, we recorded no significant orders from national retailers, which is the primary reason for the lower revenue when compared to the fourth quarter of 2006. Our fourth quarter earnings benefited from increased channel sales of Rimage’s Producer line. We also benefited from improved pricing on this product line. These factors contributed to our fourth quarter gross margin of 48%. Last year’s fourth quarter gross margin of 45% was affected by a writedown of approximately $648,000 related to the low-end 360i product line. Our fourth quarter earnings also benefited from lower operating expenses, reflecting the completion of several product development and SAP initiatives.”

 

He continued: “A significant portion of Rimage’s growth over the past few years has been generated by our ability to successfully penetrate the retail and medical imaging markets with our digital output solutions. We will continue to pursue opportunities in these markets. At the same time, we are starting to address untapped opportunities for our disc publishing technology in a number of large business service markets, including media and broadcasting, law enforcement, education, government, software and professional services. We expect business service applications to help drive Rimage’s future growth, and we plan to focus our resources toward building positions in these markets similar to what we have achieved in the retail and medical markets.”

 

Aldrich added: “At this time, we believe 2008 should be another year of progress and improved operating results for Rimage, and for the first quarter of 2008 ending March 31, we are forecasting earnings of $0.21 to $0.26 on revenues of $22 to $24 million.”

 

Financial Highlights

Recurring revenues, including sales of printer ribbons and cartridges, parts, blank CD/DVD media and maintenance contracts, increased 6% in the fourth quarter of 2007 and accounted for 54% of sales, compared to 47% in the fourth quarter of 2006. Sales of consumables, which lend a measure of stability and predictability to Rimage’s revenue stream, are benefiting from the Company’s growing installed base of disc publishing systems in retail and other markets.

 




International sales increased 18% in the fourth quarter and accounted for 44% of total sales, compared to 34% of total sales in the year-earlier period. Sales generated by Rimage’s large European operation, which is being strengthened with new management personnel and an expanded sales and marketing organization, grew 15% in the fourth quarter. Sales in Asian markets increased 39% during this period, reflecting efforts aimed at strengthening the reach of Rimage’s Tokyo sales office. Currency effects increased worldwide sales by 4% in the fourth quarter of 2007.

 

Cash and investments totaled $94.2 million at the end of the fourth quarter, compared to $84.9 million at the end of the third quarter and $77.4 million at December 31, 2006.

 

About Rimage

Rimage Corporation (www.rimage.com) is the world’s leading provider of recordable CD, DVD and BD publishing systems, which are used by businesses to produce discs with customized digital content on an on-demand basis. Rimage’s publishing systems, which span the range from high to low CD/DVD production volumes, integrate robotics, software and surface label printers into a complete publishing solution. Rimage is focusing its CD/DVD publishing solutions on a set of vertical markets with special needs for customized, on-demand digital information, including photography, medical imaging, financial institutions, business offices, and government.

 

Statements regarding Rimage’s anticipated performance are forward-looking and therefore involve risks and uncertainties, including but not limited to: market conditions, competitive products, changes in technology, conditions in overseas markets that could affect international sales, and other factors set forth in Rimage’s filings with the Securities and Exchange Commission.

 

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For additional information, contact:

 

Bernard P. (Bernie) Aldrich, CEO

Richard G. Cinquina

Robert M. Wolf, CFO

Equity Market Partners

Rimage Corporation

904/415-1415

952/944-8144

 

 

 












RIMAGE CORPORATION

Selected Consolidated Financial Information

(In thousands except per share data)

(Unaudited)

 

Consolidated Statement of Operations Information:

 

 

 

Three months ended

December 31,

 

Twelve months ended

December 31,

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$

28,212

 

$

30,519

 

$

108,874

 

$

103,252

 

Cost of Revenues

 

 

14,615

 

 

16,856

 

 

57,719

 

 

56,014

 

Gross Profit

 

 

13,597

 

 

13,663

 

 

51,155

 

 

47,238

 

Operating Expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Research and Development

 

 

1,280

 

 

1,956

 

 

5,903

 

 

6,738

 

Selling, General and Administrative

 

 

6,079

 

 

6,612

 

 

24,371

 

 

22,726

 

Total Operating Expenses

 

 

7,359

 

 

8,568

 

 

30,274

 

 

29,464

 

Operating Income

 

 

6,238

 

 

5,095

 

 

20,881

 

 

17,774

 

Other Income, Net

 

 

904

 

 

687

 

 

3,513

 

 

2,684

 

Income Before Income Taxes

 

 

7,142

 

 

5,782

 

 

24,394

 

 

20,458

 

Income Tax Expense

 

 

2,627

 

 

2,157

 

 

8,633

 

 

7,374

 

Net Income

 

 

4,515

 

 

3,625

 

 

15,761

 

 

13,084

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Per Basic Share

 

$

0.46

 

$

0.37

 

$

1.59

 

$

1.33

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income Per Diluted Share

 

$

0.45

 

$

0.34

 

$

1.52

 

$

1.26

 

Basic Weighted Average Shares Outstanding

 

 

9,686

 

 

9,899

 

 

9,915

 

 

9,812

 

Diluted Weighted Average Shares Outstanding

 

 

10,093

 

 

10,424

 

 

10,371

 

 

10,356

 

 

Consolidated Balance Sheet Information:

 

 

 

Balance as of

 

 

 

December 31,

2007

 

December 31,

2006

 

 

 

 

 

 

 

 

 

Cash and Marketable Securities

 

$

59,021

 

$

38,766

 

Accounts Receivable

 

 

14,447

 

 

21,697

 

Inventories

 

 

8,075

 

 

6,072

 

Total Current Assets

 

 

85,527

 

 

70,116

 

Property and Equipment, Net

 

 

3,206

 

 

3,626

 

Marketable Securities – Non-Current

 

 

35,201

 

 

38,594

 

Total Assets

 

 

125,096

 

 

112,359

 

Current Liabilities

 

 

17,882

 

 

16,163

 

Long-Term Liabilities

 

 

2,153

 

 

720

 

Stockholders’ Equity

 

 

105,061

 

 

95,476

 

 

Conference Call and Replay

Rimage Corporation will review its fourth quarter operating results in a conference call at 10:00 AM Eastern today. Investors can listen to the conference call at www.rimage.com. Listeners should go to this web site at least 15 minutes before the scheduled start time to download and install any necessary audio software. A replay of the conference call can be heard through February 28, 2008 by dialing 1-303-590-3000 and providing the 11099311 confirmation code.