MINNEAPOLIS -- (BUSINESS WIRE) -- Rimage Corporation (NASDAQ: RIMG) today reported its financial results for the fourth quarter and full year ended December 31, 2012.
Qumu Fourth Quarter Financial Highlights
Sherman L. Black, president and CEO, said, “The fourth quarter demonstrated the potential of our Qumu secure enterprise video solutions. Qumu’s momentum continued to build during the quarter with strong sequential growth in revenues, contracted commitments and backlog. Six new enterprise customers committed to Qumu’s enterprise video software and services, representing a broad spectrum of industries including food, pharma, high tech, financial services and transportation.”
“Enterprise customers are beginning to see video content used more and more as a means to increase employee engagement and team collaboration. Existing network infrastructure and collaboration tools are not equipped to enable the creation, management and delivery of video,” continued Mr. Black.
“Qumu allows organizations to capture, organize and distribute content across their extended enterprise to a wide variety of endpoints, including mobile devices. Qumu software offers information technology administrators and corporate communication leaders a way to securely address the challenges of video and rich content distribution overwhelming their data networks, while utilizing existing IT infrastructure.”
Disc Publishing Fourth Quarter Financial Highlights
“As expected, our disc publishing business remained challenging during the quarter, reflecting continued softness in the economies throughout Europe and budget issues faced by our government customers. We anticipate continued declines in disc publishing revenues. However, there are use cases like medical imaging and published financial information where there are high switching costs or the other technology alternatives are less viable. As a result, we believe the demand for disc publishing will continue into the future. We took actions in 2012 to reduce expenses in this business and continue to properly size our operating expense base to ensure this business remains a significant cash generator,” Mr. Black continued.
Fourth Quarter 2012 Financial Highlights
Full Year 2012 Highlights
“As we look ahead, we are optimistic about our outlook. Qumu is our growth engine and our success in driving traction in this business in the second half of 2012 confirms our belief that we have strong differentiated solutions in the large and rapidly growing market for enterprise video communications. Our priorities during 2013 are to continue to drive significant revenue growth from Qumu, to maximize the cash generation from disc publishing, to maintain a healthy cash position and to drive toward improved profitability,” concluded Mr. Black.
Stock Repurchase Program
During the quarter, the Company repurchased approximately 1.4 million shares of Rimage common stock for a total cost of $8.4 million. There are approximately 778,000 shares remaining for repurchase under the authorization. As of December 31, 2012, there were 8,653,932 shares outstanding.
For the first quarter 2013, the Company expects revenues of between $19 and $21 million and the net loss per share is expected to be between $(0.18) and $(0.30). Excluding amortization of Qumu intangibles, non-GAAP net loss per share is expected to be between $(0.16) and $(0.28). These loss projections reflect no tax benefit due to the establishment of the tax valuation allowance for book purposes.
For total year 2013, the Company expects consolidated revenues to grow compared to 2012. Qumu revenues are expected to grow greater than 50% in 2013 compared to 2012. The Company expects this Qumu growth to be partially offset by a decline in disc publishing revenues. Consolidated cash from operations is expected at approximately break even levels for the year. The Company has approximately 778,000 shares remaining on its repurchase authorization and may repurchase shares from time to time during the year depending on market conditions.
Earnings per Share and Financial Guidance Reconciliation
Fourth Quarter 2012
Full Year 2012
|GAAP earnings (loss) per share||$(0.12)||$(4.85)|
|Impact of amortization of intangibles||$0.03||$0.12|
Impact of non cash charges for goodwill impairment, intangible asset impairment and deferred tax valuation allowance
|Non-GAAP earnings (loss) per share||$(0.09)||$(0.57)|
First Quarter 2013
|Estimated GAAP earnings (loss) per share||$(0.18) - $(0.30)|
|Estimated impact of amortization of intangibles||$0.02|
|Estimated Non-GAAP earnings (loss) per share||$(0.16) - $(0.28)|
Note to reconcile non-GAAP financial measures to GAAP
Management believes non-GAAP financial information provides meaningful supplemental information regarding the Company’s financial performance by excluding the amortization of Qumu acquisition intangibles that may not be indicative of the core business operating results and by excluding non-cash charges relating to the impairment of goodwill, a reduction of the value of amortizing intangible assets and the establishment of a valuation allowance against its deferred tax assets that are not related to the operation of the Company’s business and such charges are non-recurring, infrequent or unusual. Rimage believes that this additional financial information is useful to management and investors in assessing the Company’s historical and future performance.
The Company has scheduled a conference call and webcast to review its fourth quarter results and recent corporate developments today, February 26, 2013 at 4:30 p.m. Eastern Time. The dial-in number for the conference call is 877-941-0844 for domestic participants and 480-629-9835 for international participants. Investors can also access a webcast of the live conference call by linking through the investor relations section of the Rimage website, www.rimage.com. Webcasts will be archived on Rimage’s website.
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements contained in this press release that are not statements of historical fact may be deemed to be forward-looking statements. Without limiting the foregoing, words such as “may,” “will,” “expect,” “believe,” “anticipate,” or “estimate” or comparable terminology are intended to identify forward-looking statements. Such forward-looking statements include, for example, statements about: the Company’s future revenue and operating performance, the demand for the Company’s products or software, the integration of the Qumu business, anticipated synergies between Rimage and Qumu businesses, the effect of changes in technology, the development and marketing of new products, or repurchases under the Company’s expanded stock repurchase program. The statements made by the Company are based upon management’s current expectations and are subject to certain risks and uncertainties that could cause the actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties include the risk factors described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2011 and other factors set forth in the Company’s filings with the Securities and Exchange Commission.
About Rimage Corporation
Founded in 1978, Rimage Corporation (NASDAQ: RIMG) helps businesses deliver digital content directly and securely to their employees, customers, and partners. Rimage’s Qumu business is the global leader in the rapidly growing enterprise video communications market and an innovator in the secure mobile delivery of rich content. Rimage’s Disc Publishing business is the global leader in CD, DVD and Blu-ray-Disc™ archiving and distribution solutions. Rimage’s industry-leading solutions help thousands of organizations in North America, Europe and Asia use video and other rich content to increase engagement and collaboration without losing control. Additional information can be found at www.rimage.com.
Blu-ray Disc™ is a trademark of the Blu-ray Disc Association.
|Selected Consolidated Financial Information|
|(In thousands except per share data)|
|Consolidated Statements of Operations Information:|
|Three months ended||Year ended|
|December 31,||December 31,|
|Cost of revenues||10,096||10,721||40,782||41,613|
|Research and development||2,909||2,642||11,866||7,257|
|Selling, general and administrative||8,900||9,913||36,039||30,093|
Goodwill and intangible asset impairment charge
|Amortization of purchased intangibles||157||223||952||223|
|Total operating expenses||11,966||12,778||78,405||37,573|
|Operating income (loss)||(1,313||)||(1,836||)||(39,744||)||4,448|
|Other income (expense), net||(44||)||57||(44||)||221|
|Income (loss) before income taxes||(1,357||)||(1,779||)||(39,788||)||4,669|
|Income tax expense (benefit)||(199||)||(382||)||8,809||1,997|
|Net income (loss)||(1,158||)||(1,397||)||(48,597||)||2,672|
Net loss attributable to noncontrolling interest
|Net income (loss) attributable to Rimage||$||(1,115||)||$||(1,351||)||$||(48,338||)||$||2,835|
|Net income (loss) per basic share||$||(0.12||)||$||(0.13||)||$||(4.85||)||$||0.29|
|Net income (loss) per diluted share||$||(0.12||)||$||(0.13||)||$||(4.85||)||$||0.29|
Basic weighted average shares outstanding
Diluted weighted average shares outstanding
|Consolidated Balance Sheet Information:|
|Balance as of|
|December 31,||December 31,|
|Cash and marketable securities||$||50,140||$||70,161|
|Total current assets||75,950||98,437|
|Property and equipment, net||5,966||6,177|
|Rimage stockholders’ equity||70,524||131,940|