Electro Rent (ELRC) 8-K Electro Rent Reports Financial Results

Exhibit 99.1

FOR IMMEDIATE RELEASE

For More Information, Contact:

Daniel Greenberg, Chairman & CEO	Roger Pondel/Laurie Berman
Electro Rent Corporation	PondelWilkinson Inc.
818-786-2525	310-279-5980
	investor@pondel.com

ELECTRO RENT REPORTS FINANCIAL RESULTS

FOR FISCAL 2008 FOURTH QUARTER AND FULL YEAR

VAN NUYS, Calif. - August 4, 2009 - Electro Rent Corporation (NASDAQ:ELRC) today reported financial results for its 2009 fiscal fourth quarter and full year ended May 31, 2009.

Total revenues for the fiscal 2009 fourth quarter were $30.0 million, compared with $38.9 million for the fiscal 2008 fourth quarter.  Rental and lease revenues equaled $22.5 million, versus $27.6 million in last year’s fourth quarter.  Equipment sales and other revenues were $7.5 million for the fiscal 2009 fourth quarter, compared with $11.3 million in the same fiscal 2008 quarter.

“As the fiscal year came to a close, we were unable to avoid the sobering effects of the economic crisis,” said Daniel Greenberg, Chairman and CEO of Electro Rent.  “While the amount of equipment we had on rent remained relatively stable in the United States in the fourth quarter, the ongoing recession and continued competitive pressures negatively impacted margins.  Overseas, as was the case for most of the year, our European business did relatively well, but manufacturing activity was down substantially in Asia, which, in turn, impacted our business in China.”

SG&A expenses for the fiscal 2009 fourth quarter were $10.1 million, or 33.5% of total revenues, compared with $11.5 million, or 29.7% of total revenues, in the year-ago period.  The reduction in SG&A expenses primarily reflected proactive cost-cutting measures throughout the company.

Total operating expenses declined to $26.5 million for the fiscal 2009 fourth quarter from $31.2 million in the year-ago period, primarily reflecting lower costs of revenue and reduced SG&A expenses.  Interest income was $139,000 for the fourth quarter of fiscal 2009, versus $665,000 in the prior year, principally due to lower interest rates and a smaller cash balance.

Operating profit for the fourth quarter of fiscal 2009 amounted to $3.5 million, or 11.7% of total revenues, versus $7.7 million, or 19.7% of total revenues, for last year’s fourth quarter.

Net income for the fiscal 2009 fourth quarter was $2.0 million, or $0.08 per diluted share, compared with $5.2 million, or $0.20 per diluted share, for the same period last year.

 “We took early steps to lower expenses and help reduce our economic exposure, working diligently to ensure that our business is properly matched to the current economic reality, while at the same time working to avoid compromising our long-term objectives,” Greenberg said.  “We purchased less equipment, reduced our workforce and implemented changes to our compensation structure, while keeping our core competencies intact. As a result, we have successfully preserved cash and maintained the company’s financial flexibility.  This fiscal prudence has been a hallmark of Electro Rent’s operating history and is of the utmost importance as we identify new revenue generating opportunities that have become available as a result of the current economic predicament.  Moreover, demonstrating management’s and the board’s confidence in the company’s future, we continued to purchase Electro Rent shares and pay a dividend on our common stock,” Greenberg added.

For fiscal 2009, total revenues were $130.5 million, compared with $144.5 million for fiscal 2008.  Rental and lease revenues for fiscal 2009 were $98.4 million, versus $108.8 million last year.  Equipment sales and other revenues were $32.1 million for fiscal 2009, versus $35.8 million for fiscal 2008.

SG&A expenses were $44.5 million, or 34.1% of total revenues, for fiscal 2009, versus $43.9 million, or 30.4% of total revenues, for fiscal 2008.  Total operating expenses for fiscal 2009 were $113.1 million, slightly below the $113.8 million last year.

Operating profit was $17.4 million, or 13.3% of total revenue, for fiscal 2009, versus $30.7 million, or 21.2% of revenue, in the prior year.

Net income for fiscal 2009 was $11.8 million, or $0.47 per diluted share, compared with $21.1 million, or $0.81 per diluted share, for fiscal 2008.

Equipment purchases for the fiscal 2009 fourth quarter and full year were $8.5 million and $50.2 million, respectively, compared with $23.2 million and $76.0 million, respectively, for the fiscal 2008 fourth quarter and full year.  The book value of Electro Rent's equipment pool was $158.3 million at May 31, 2009, versus $172.5 million at May 31, 2008.

During the fourth quarter of fiscal 2009, Electro Rent purchased 296,892 shares of its common stock at an average price of $8.14 per share, for a total expenditure of $2.4 million.  For the full year, Electro Rent purchased 2,138,057 shares of its common stock at an average price of $10.67 per share, for a total expenditure of $22.8 million.

Electro Rent paid dividends totaling $15.0 million and $11.7 million for fiscal 2009 and 2008, respectively.  On an annualized basis, the company’s current quarterly dividend of $0.15 per common share represents a 6.3% yield on the July 31, 2009 close price of $9.52.

Total shareholders' equity was $228.8 million, or $9.55 per share, at May 31, 2009, compared with $256.1 million, or $9.87 per share, at May 31, 2008.  Electro Rent has no debt on its balance sheet.

At May 31, 2009, Electro Rent had $22.2 million in cash and cash equivalents, $28.2 million in short-term bond funds and $21.6 million (at cost) in auction rate securities (ARS) for a total cash, cash equivalents and investments balance of $72.0 million, versus $74.6 million at May 31, 2008.

About Electro Rent

Electro Rent Corporation (www.ElectroRent.com) is one of the largest global organizations devoted to the rental, leasing and sales of general purpose electronic test equipment, personal computers and servers.

"Safe Harbor" Statement:

Except for the historical statements and discussions above, our statements above constitute forward-looking statements within the meaning of section 21E of the Securities Exchange Act of 1934.  These forward-looking statements, which include statements about the company’s ability to reduce its economic exposure, ensure that its business is properly aligned with the current economic reality, and take advantage of new revenue generating opportunities, among others, reflect Electro Rent’s management's current views with respect to future events and financial performance; however, you should not put undue reliance on these statements.  When used, the words "anticipates," "believes," "expects," "intends," "future," and other similar expressions identify forward-looking statements.  These forward-looking statements are subject to certain risks and uncertainties.  The company believes its management's assumptions are reasonable; nonetheless, it is likely that at least some of these assumptions will not come true.  Accordingly, Electro Rent’s actual results will probably differ from the outcomes contained in any forward-looking statement, and those differences could be material.  Factors that could cause or contribute to these differences include, among others, those risks and uncertainties discussed in the company’s periodic reports on Form 10-K and 10-Q and in its other filings with the Securities and Exchange Commission.  Should one or more of the risks discussed, or any other risks, materialize, or should one or more of our underlying assumptions prove incorrect, our actual results may vary materially from those anticipated, estimated, expected or projected.  In light of the risks and uncertainties, there can be no assurance that any forward-looking statement will in fact prove to be correct.  Electro Rent undertakes no obligation to update or revise any forward-looking statements.

(Financial Tables Follow)

ELECTRO RENT CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited; 000's omitted, except per share data)

	Three Months Ended				Twelve Months Ended
	May 31				May 31
	2009		2008		2009		2008
Revenues:
Rentals and leases	$	22,515	$	27,648	$	98,395	$	108,761
Sales of equipment and other revenues		7,488		11,253		32,086		35,775
Total revenues		30,003		38,901		130,481		144,536
Operating expenses:
Depreciation of rental and lease equipment		11,362		11,518		46,056		44,987
Costs of revenues other than
depreciation of rental and lease equipment		5,066		8,168		22,574		24,914
Selling, general and administrative expenses		10,052		11,542		44,456		43,940
Total operating expenses		26,480		31,228		113,086		113,841
Operating profit		3,523		7,673		17,395		30,695
Interest income, net		139		665		1,507		3,292
Income before income taxes		3,662		8,338		18,902		33,987
Income tax provision		1,658		3,128		7,150		12,883
Net income	$	2,004	$	5,210	$	11,752	$	21,104
Earnings per share:
Basic	$	0.08	$	0.20	$	0.47	$	0.81
Diluted	$	0.08	$	0.20	$	0.47	$	0.81
Shares used in per share calculation:
Basic		24,040		25,948		24,899		25,910
Diluted		24,047		26,108		24,981		26,079

ELECTRO RENT CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited; 000's omitted)

	May 31
	2009		2008
Assets
Cash and cash equivalents	$	22,215	$	50,964
Investments available-for-sale, at fair value		28,188		22,601
Investments, trading, at fair value		19,977		-
Put options		1,623		-
Accounts receivable, net		16,271		23,128
Rental and lease equipment, net		158,252		172,468
Other property, net		13,781		14,341
Goodwill		3,109		3,109
Intangibles, net		734		1,069
Other		7,184		5,402
	$	271,334	$	293,082
Liabilities and Shareholders' Equity
Liabilities:
Accounts payable	$	3,291	$	4,562
Accrued expenses		15,023		12,565
Deferred revenue		4,281		4,943
Deferred tax liability		19,986		14,904
Total liabilities		42,581		36,974
Commitments and contingencies
Shareholders' equity:
Common stock		32,596		33,938
Accumulated other comprehensive loss		176		(619	)
Retained earnings		195,981		222,789
Total shareholders' equity		228,753		256,108
	$	271,334	$	293,082

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