EXHIBIT 99.1
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| Investor Relations Contacts: | | Public Relations Contacts: | | |
| Bob O’Malley | | Stacey Vorhees | | |
| President and Chief Executive Officer | | (925) 336-9592 | | |
| InFocus Corporation | | | | |
| (503) 685-8800 | | | | |
Lisa Prentice
Chief Financial Officer
InFocus Corporation
(503) 685-8800
InFocus Announces Third Quarter 2008 Financial Results
WILSONVILLE, Ore., October 28, 2008 – InFocus® Corporation (NASDAQ: INFS) today announced its third quarter 2008 financial results. For the third quarter, the Company reported revenues of $70.6 million and a net loss of $4.2 million, or $0.10 per share, compared to a net loss of $3.8 million, or $0.10 per share, in the second quarter of 2008 and a net loss of $2.8 million, or $0.07 per share, in the third quarter of 2007. Gross margin for the third quarter of 2008 was 16.1 percent, a reduction of 2.1 percentage points compared to both the second quarter of 2008 and the third quarter of 2007.
Included in the third quarter results is a restructuring charge of $0.4 million, which accounted for $0.01 of the net loss per share, compared to a restructuring charge of $0.9 million, or $0.03 per share in the second quarter of 2008. Excluding these charges, the Company realized a proforma Operating Loss for the third quarter of $3.7 million and a proforma Net Loss of $3.8 million, or $0.09 per share, compared to a proforma Operating Loss for the third quarter of 2007 of $3.3 million and a proforma Net Loss of $2.6 million, or $0.07 per share.
The Company reported total cash, restricted cash, and marketable securities as of September 30, 2008 of $70.3 million, an increase of $0.5 million from the second quarter of 2008, and a decrease of $2.4 million from the third quarter of 2007.
Commenting on the third quarter results, Bob O’Malley, President and CEO stated, “Obviously, we did not meet our plans for Q3. As economic conditions deteriorated, we saw softening demand and increased margin pressure in our US and European markets. However, we are entering the fourth quarter with fresh inventory of new products, in the pipeline and ready for sale.”
Quarterly Revenue, Unit, ASP and Gross Margin Comparisons
Third quarter revenues of $70.6 million represent a decrease of 3 percent compared to the second quarter of 2008, and a decrease of 7 percent compared to the third quarter of 2007. Projector unit shipments totaled approximately 94,000 in the third quarter, an increase of approximately 2 percent from the second quarter, and approximately 10 percent compared to the third quarter of 2007. Overall, average selling prices (ASPs) decreased by approximately 5 percent from the second quarter of 2008. Gross margins were 16.1 percent, a reduction of 2.1 percent from the second quarter of 2008, and were driven by product mix shifts within the quarter. Revenue in the Americas decreased by 3 percent while units shipped increased by 4 percent compared to the second quarter of 2008. Revenue and unit shipments both decreased by 8 percent in Europe. Asian revenues increased 12 percent and units increased by 18 percent compared to the second quarter.
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Operating Expenses and & Other Income
Excluding charges, Operating Expenses in the third quarter were $15.1 million, a reduction of $0.5 million from second quarter expenses of $15.6 million. The reduction was due to ongoing expense management and lower variable sales and marketing costs. Non-Operating Income was $0.1 million for the third quarter, compared to Non-Operating Expense of $0.2 million in the second quarter of 2008 and Non-Operating Income of $0.8 million in the third quarter of 2007.
Balance Sheet
Total cash, restricted cash, and marketable securities as of September 30, 2008 were $70.3 million, an increase of $0.5 million from the end of the second quarter. Day’s sales outstanding for the third quarter were 51 days, an improvement of 3 days from the prior quarter. Inventories at the end of Q3 were $30.4 million, an increase of $5.9 million compared to the second quarter of 2008.
Reconciliation of GAAP and Pro Forma Information
The Company has recorded charges that are excluded from operating expenses and earnings for comparative purposes. In accordance with SEC FR-59, attached is a Statement of Reconciliation of GAAP Earnings.
Conference Call Information
The Company will hold a conference call today at 11:00 a.m. Eastern Time. The session will include brief remarks and a question and answer period. The conference can be accessed by calling 888.713.4216 (U.S. participants) or 617.213.4868 (outside U.S. participants) and pin# 42931534, or via live audio web cast at www.infocus.com. Upon completion of the call, the web cast will be archived and accessible on our website for individuals unable to listen to the live telecast. The conference call replay will also be available through November 11th, 2008 by dialing 888.286.8010 (U.S.) or 617.801.6888 (outside U.S.) and Pin #55918344.
About InFocus Corporation
InFocus is the industry pioneer and a global leader in the digital projection market. The company’s digital projectors make bright ideas brilliant everywhere people gather to communicate and be entertained - in meetings, presentations, classrooms and living rooms around the world. Backed by more than 20 years of experience and innovation in digital projection, and over 150 patents, InFocus is dedicated to setting the industry standard for large format visual display. The company is based in Wilsonville, Oregon with operations in North America, Europe and Asia. InFocus is listed on NASDAQ under the symbol INFS. For more information, visit the company’s website at www.infocus.com.
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InFocus, In Focus, INFOCUS (stylized), IN, ASK, Proxima, LiteShow, LP, ScreenPlay, Play Big, Work Big, Learn Big and The Big Picture are either registered trademarks or trademarks of InFocus Corporation in the U.S. and abroad. All other trademarks are used for identification purposes only and are the property of their respective owners in this and other countries. All rights reserved.
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InFocus Corporation
Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | |
| | | Three months ended September 30, | | | Nine months ended September 30, | |
| | | 2008 | | | 2007 | | | 2008 | | | 2007 | |
Revenues | | $ | 70,596 | | | $ | 75,790 | | | $ | 204,294 | | | $ | 227,078 | |
Cost of revenues | | | 59,215 | | | | 62,026 | | | | 167,244 | | | | 192,850 | |
| | | | | | | | | | | | | | | | |
Gross margin | | $ | 11,381 | | | $ | 13,764 | | | $ | 37,050 | | | $ | 34,228 | |
Operating expenses: | | | | | | | | | | | | | | | | |
Marketing and sales | | $ | 7,926 | | | $ | 8,424 | | | $ | 25,115 | | | $ | 27,510 | |
Research and development | | | 3,001 | | | | 3,367 | | | | 8,562 | | | | 11,333 | |
General and administrative | | | 4,172 | | | | 5,305 | | | | 12,571 | | | | 15,613 | |
Restructuring costs | | | 430 | | | | 225 | | | | 1,330 | | | | 4,675 | |
| | | | | | | | | | | | | | | | |
| | $ | 15,529 | | | $ | 17,321 | | | $ | 47,578 | | | $ | 59,131 | |
Loss from operations | | $ | (4,148 | ) | | $ | (3,557 | ) | | $ | (10,528 | ) | | $ | (24,903 | ) |
Other income, net | | | 146 | | | | 764 | | | | 1,457 | | | | 1,422 | |
| | | | | | | | | | | | | | | | |
Loss before income taxes | | | (4,002 | ) | | | (2,793 | ) | | | (9,071 | ) | | | (23,481 | ) |
Provision for income taxes | | | 214 | | | | 27 | | | | 796 | | | | 174 | |
| | | | | | | | | | | | | | | | |
Net Loss | | $ | (4,216 | ) | | $ | (2,820 | ) | | $ | (9,867 | ) | | $ | (23,655 | ) |
| | | | | | | | | | | | | | | | |
Basic and diluted net loss per share | | $ | (0.10 | ) | | $ | (0.07 | ) | | $ | (0.25 | ) | | $ | (0.60 | ) |
| | | | | | | | | | | | | | | | |
Basic and diluted shares outstanding | | | 40,260 | | | | 39,786 | | | | 39,974 | | | | 39,682 | |
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InFocus Corporation
Consolidated Balance Sheets
(In thousands)
(Unaudited)
| | | | | | | | | | | | |
| | | September 30,
2008 | | | December 31,
2007 | | | June 30,
2008 | |
Assets | | | | | | | | | | | | |
Current Assets: | | | | | | | | | | | | |
Cash and cash equivalents | | $ | 55,146 | | | $ | 61,187 | | | $ | 65,901 | |
Restricted cash, equivalents, and marketable securities | | | 15,154 | | | | 22,923 | | | | 3,873 | |
Accounts receivable, net of allowances | | | 39,197 | | | | 46,315 | | | | 43,988 | |
Inventories | | | 30,351 | | | | 30,984 | | | | 24,435 | |
Other current assets | | | 4,943 | | | | 7,548 | | | | 7,947 | |
| | | | | | | | | | | | |
Total Current Assets | | | 144,791 | | | | 168,957 | | | | 146,144 | |
Property and equipment, net | | | 2,407 | | | | 2,973 | | | | 2,724 | |
Other assets, net | | | 5,347 | | | | 1,061 | | | | 3,768 | |
| | | | | | | | | | | | |
Total Assets | | $ | 152,545 | | | $ | 172,991 | | | $ | 152,636 | |
| | | | | | | | | | | | |
Liabilities and Shareholders’ Equity | | | | | | | | | | | | |
Current Liabilities: | | | | | | | | | | | | |
Accounts payable | | $ | 64,093 | | | $ | 65,764 | | | $ | 49,747 | |
Other current liabilities | | | 14,626 | | | | 19,906 | | | | 16,668 | |
| | | | | | | | | | | | |
Total Current Liabilities | | | 78,719 | | | $ | 85,670 | | | | 66,415 | |
Other Long-Term Liabilities | | | 2,316 | | | | 3,623 | | | | 2,638 | |
Shareholders’ Equity: | | | | | | | | | | | | |
Common stock and additional paid-in capital | | | 170,011 | | | | 168,878 | | | | 169,808 | |
Other comprehensive income: | | | | | | | | | | | | |
Foreign currency translation | | | 34,792 | | | | 38,246 | | | | 42,852 | |
Accumulated deficit | | | (133,293 | ) | | | (123,426 | ) | | | (129,077 | ) |
| | | | | | | | | | | | |
Total Shareholders’ Equity | | | 71,510 | | | | 83,698 | | | | 83,583 | |
| | | | | | | | | | | | |
Total Liabilities and Shareholders’ Equity | | $ | 152,545 | | | $ | 172,991 | | | $ | 152,636 | |
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InFocus Corporation
Reconciliation of GAAP Earnings
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Third Quarter 2008 | | | Second Quarter 2008 | |
| | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Loss From
Operations | | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Loss From
Operations | |
GAAP | | $ | (4,216 | ) | | $ | (0.10 | ) | | $ | 15,529 | | | $ | (4,148 | ) | | $ | (3,843 | ) | | $ | (0.10 | ) | | $ | 16,532 | | | $ | (3,298 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restructuring costs | | $ | 430 | | | $ | 0.01 | | | $ | (430 | ) | | $ | 430 | | | $ | 900 | | | $ | 0.03 | | | $ | (900 | ) | | $ | 900 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Proforma excluding adjustments | | $ | (3,786 | ) | | $ | (0.09 | ) | | $ | 15,099 | | | $ | (3,718 | ) | | $ | (2,943 | ) | | $ | (0.07 | ) | | $ | 15,632 | | | $ | (2,398 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| | | Third Quarter 2008 | | | Third Quarter 2007 | |
| | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Loss From
Operations | | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Income
(Loss) from
Operations | |
GAAP | | $ | (4,216 | ) | | $ | (0.10 | ) | | $ | 15,529 | | | $ | (4,148 | ) | | $ | (2,820 | ) | | $ | (0.07 | ) | | $ | 17,321 | | | $ | (3,557 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restructuring costs | | $ | 430 | | | $ | 0.01 | | | $ | (430 | ) | | $ | 430 | | | $ | 225 | | | $ | — | | | $ | (225 | ) | | $ | 225 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Proforma excluding adjustments | | $ | (3,786 | ) | | $ | (0.09 | ) | | $ | 15,099 | | | $ | (3,718 | ) | | $ | (2,595 | ) | | $ | (0.07 | ) | | $ | 17,096 | | | $ | (3,332 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | |
| | | Year-to-Date 2008 | | | Year-to-Date 2007 | |
| | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Loss From
Operations | | | Net Loss | | | Net Loss Per
Share | | | Operating
Expenses | | | Income
(Loss) from
Operations | |
GAAP | | $ | (9,867 | ) | | $ | (0.25 | ) | | $ | 47,578 | | | $ | (10,528 | ) | | $ | (23,655 | ) | | $ | (0.60 | ) | | $ | 59,131 | | | $ | (24,903 | ) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Adjustments: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Restructuring costs | | $ | 1,330 | | | $ | 0.03 | | | $ | (1,330 | ) | | $ | 1,330 | | | $ | 4,675 | | | $ | 0.12 | | | $ | (4,675 | ) | | $ | 4,675 | |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Proforma excluding adjustments | | $ | (8,537 | ) | | $ | (0.21 | ) | | $ | 46,248 | | | $ | (9,198 | ) | | $ | (18,980 | ) | | $ | (0.48 | ) | | $ | 54,456 | | | $ | (20,228 | ) |
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