Exhibit 99.1
NEWS & INFORMATION
FOR: | EMERSON RADIO CORP. | |||
610 Fifth Ave | ||||
New York, NY 10020 | ||||
CONTACT: | Emerson Radio Corp. | or: Investor Relations: | ||
Greenfield Pitts | Robert Maffei | |||
Chief Financial Officer | Investor Relations Manager | |||
(212) 897-5441 | (973) 428-2098 | |||
Brainerd Communicators | ||||
Brad Edwards or | ||||
Denise Roche | ||||
(212) 986-6667 | ||||
Media Relations: | ||||
Brainerd Communicators, Inc. | ||||
Scott Cianciulli | ||||
(212) 986-6667 |
Thursday, August 14, 2008
EMERSON RADIO CORP. REPORTS FISCAL 2009 FIRST QUARTER RESULTS
PARSIPPANY, N.J. – August 14, 2008 – Emerson Radio Corp. (AMEX:MSN) today reported financial results for its first quarter ended June 30, 2008.
Net revenues for the first quarter of fiscal 2009 were $43.1 million, a decrease of $9.6 million compared to net revenues in the first quarter of fiscal 2008. The decrease in net revenues during the first quarter of fiscal 2009 was primarily due to lower sales of the Company’s traditional audio products and iPod® accessories and lower themed product sales, partially offset by strong year-over-year increases in home appliance product sales.
Operating loss for the first quarter of fiscal 2009 was $890,000 compared to operating income of $588,000 during the first quarter of fiscal 2008. The change in operating income (loss) was due to the lower level of
net revenues in the first quarter of fiscal 2009, the reversal in the prior year’s first quarter of inventory reserves related to the discontinuance of a themed product line, the startup costs in the current quarter of the Company’s ASI joint venture formed in February 2008, and higher year-over-year quality assurance costs.
Net loss for the first quarter of fiscal 2009 was $929,000, or $0.03 per diluted share, compared to net income of $442,000, or $0.02 per diluted share, for the first quarter of fiscal 2008. The first quarter of fiscal 2009 net loss was due primarily to the foregoing factors and movements in the Company’s deferred tax balances, partly offset by $262,000 of realized and unrealized gains in the first quarter of fiscal 2009 on the valuation of the Company’s auction rate preferred securities.
“During the first quarter, our Home Appliance product category continued to experience strong consumer demand as sales increased, more than 17% compared to last year due to strong core product sales, the introduction of several new products and expanded distribution,” said John Spielberger, President of North American Operations. “While the performance of our audio category is disappointing, we are taking continuous action to freshen our product lineup to meet evolving technology and consumer trends. Our themed product sales will see the launch during our second fiscal quarter of Hot Wheels children’s electronics in multiple large retail outlets, and the introduction of U.B. Funkeys character-based computer speakers and USB Flash drives. We continue to move forward with our strategies and initiatives to reposition Emerson for growth through a focus on product re-design and profitable product extensions across all of our key categories.”
About Emerson Radio Corp.
Emerson Radio Corporation (AMEX: MSN), founded in 1948, is headquartered in Parsippany, N.J. The Company designs, markets and licenses, worldwide, a variety of consumer electronics and home appliances including microwaves and wine coolers, clock radios, full lines of televisions and other video products, and audio and home theater products. For more information, please visit Emerson Radio’s Web site atwww.emersonradio.com.
Forward Looking Statements
This release contains “forward-looking statements” made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management’s current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, including the risk factors detailed in the Company’s reports as filed with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this news release.
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except earnings per share data)
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except earnings per share data)
Three months ended June 30, | ||||||||
2008 | 2007 | |||||||
Net revenues | ||||||||
Net revenues | $ | 43,095 | $ | 52,603 | ||||
Net revenues-related party | 13 | 85 | ||||||
43,108 | 52,688 | |||||||
Costs and expenses: | ||||||||
Cost of sales | 38,021 | 45,248 | ||||||
Other operating costs and expenses | 1,131 | 1,796 | ||||||
Selling, general and administrative expenses (exclusive of non-cash compensation shown below) | 4,828 | 4,977 | ||||||
Non-cash compensation, net of recoveries | 18 | 79 | ||||||
43,998 | 52,100 | |||||||
Operating (loss) income | (890 | ) | 588 | |||||
Interest income, net | 132 | 70 | ||||||
Interest income-related party | — | 163 | ||||||
Realized/unrealized holding gains on trading securities | 262 | — | ||||||
(Loss) income before income taxes and minority interest | (496 | ) | 821 | |||||
Provision for income taxes | 527 | 379 | ||||||
Minority interest in loss of consolidated subsidiary | 94 | — | ||||||
Net (loss) income | $ | (929 | ) | $ | 442 | |||
Net (loss) income per share | ||||||||
Basic | $ | (0.03 | ) | $ | 0.02 | |||
Diluted | $ | (0.03 | ) | $ | 0.02 | |||
Weighted average shares outstanding | ||||||||
Basic | 27,130 | 27,115 | ||||||
Diluted | 27,130 | 27,141 |
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands)
(In thousands)
June 30, 2008 | March 31, 2008(A) | |||||||
(Unaudited) | ||||||||
Cash and cash equivalents | $ | 16,569 | $ | 14,444 | ||||
Restricted cash | 2,000 | — | ||||||
Foreign exchange forward contracts | — | 134 | ||||||
Accounts receivable | 21,562 | 17,289 | ||||||
Due from affiliates | 179 | 765 | ||||||
Inventory, net | 26,593 | 24,854 | ||||||
Deferred tax assets | 4,811 | 5,412 | ||||||
Other current assets | 3,987 | 4,377 | ||||||
Total current assets | 75,701 | 67,275 | ||||||
Property, plant and equipment, net | 1,863 | 1,902 | ||||||
Investments in marketable securities | 10,510 | 11,948 | ||||||
Other assets | 6,914 | 6,804 | ||||||
Total assets | $ | 94,988 | $ | 87,929 | ||||
Current liabilities | 31,053 | 22,978 | ||||||
Long-term borrowings | 123 | 142 | ||||||
Other long term debt | 65 | 57 | ||||||
Minority interest | 39 | 133 | ||||||
Shareholders’ equity | 63,708 | 64,619 | ||||||
Total liabilities and equity | $ | 94,988 | $ | 87,929 | ||||
(A) | Reference is made to the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2008 filed with the Securities and Exchange Commission in July 2008 and amended in July 2008. |