EXHIBIT 99.1
RIMAGE REPORTS STRONG THIRD QUARTER OPERATING RESULTS
NATIONAL RETAILER FIELD TESTING RIMAGE'S CD PUBLISHING SYSTEMS
IN ITS ONE-HOUR PHOTO DEVELOPING LABS
MINNEAPOLIS, MN--OCTOBER 22, 2003--Rimage Corporation (Nasdaq NMS: RIMG) today
reported sales of $13,791,000 foR the third quarter of 2003 ended September 30,
an increase of 10% from $12,555,000 in the year-earlier period and also up from
$12,791,000 in this year's second quarter. Net income for the third quarter of
2003 came to $1,980,000 or $0.20 per diluted share, up from $1,879,000 or $0.20
per diluted share in last year's third quarter and also up from $1,717,000 or
$0.18 per diluted share in the second quarter of 2003. Rimage's operating
results for the current quarter were consistent with previously-issued financial
guidance.
Bernard P. (Bernie) Aldrich, president and chief executive officer, commented:
"Rimage continued to perform at a high level in this year's third quarter. Our
solid, on-plan performance was fueled, in part, by growing demand for our
Desktop publishing line for business office applications and strong sales of
CD/DVD publishing systems in the European marketplace. Throughout the past year,
we have benefited from the strength of our global distribution channel and the
steadily growing acceptance of our industry-leading CD/DVD publishing technology
in our targeted markets, including digital photography, medical imaging, banking
and finance, and government. Given these factors, we believe the fourth quarter
is shaping up as another good period for Rimage."
Aldrich added: "To help determine the acceptance by consumers of having their
photographs published on CDs, a major national retailer has started field
testing our DiscLab CD publishing equipment in a significant number of its
in-store photo labs in one of its local markets. Our DiscLab equipment has been
integrated into the digital, one-hour photo-finishing lab system of a strategic
partner that serves this national retailer."
THIRD QUARTER HIGHLIGHTS
o International sales increased 25% in the third quarter versus the
year-earlier period and accounted for 39% of total third quarter revenues,
compared to 35% of total sales in the third quarter of 2002. Currency
effects increased worldwide sales by 5% in this year's third quarter.
o Recurring revenues, including sales of maintenance contracts, printer
ribbons and cartridges, parts and CD/DVD media, increased 14% in the third
quarter from the year-earlier period and accounted for 29% of total sales.
The ongoing growth of recurring revenues reflects continued expansion of
Rimage's worldwide installed base of CD/DVD publishing systems.
o Rimage ended the quarter with a production backlog of approximately
$750,000, all of which is expected to ship in the fourth quarter.
o Selling, general and administrative expense increased 12% in the third
quarter, reflecting investments in sales and marketing programs aimed at
strengthening Rimage's ability to penetrate its targeted markets.
o Cash and short-term investments totaled $43.4 million at September 30, 2003,
an increase of $7.1 million or 20% from $36.3 million at the end of 2002.
Rimage's balance sheet remains debt-free, while shareholder's equity rose to
$49.4 million at September 30, 2003, from $42.2 million at year-end 2002.
In other developments, Rimage was recently named to Forbes magazine's list of
"America's 200 Best Small Companies," based on rankings of sales, profits,
five-year average return on equity and market value. In addition, Rimage's new
Protege II DVD publishing system recently received the Editor's Choice Award
from E Media magazine.
FOURTH QUARTER 2003 GUIDANCE
For the fourth quarter of 2003 ending December 31, Rimage is forecasting
earnings of $0.20 to $0.22 per diluted share on revenues of $13.5 million to
$14.5 million. Rimage reported earnings of $0.17 per diluted share on revenues
of $11.8 million in the fourth quarter of 2002.
ABOUT RIMAGE
Rimage Corporation is the world's leading provider of recordable CD and DVD
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: digital photography, banking and finance, medical imaging, and
government.
Statements regarding Rimage's anticipated performance in 2003 are
forward-looking and therefore involve risks and uncertainties, including but not
limited to: market conditions in the computer peripherals market, 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.
# # #
For additional information, contact:
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Bernard P. (Bernie) Aldrich, CEO Richard G. Cinquina
Robert M. Wolf, CFO Equity Market Partners
Rimage Corporation 800/522-1744 or 612/338-0810
952/944-8144
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RIMAGE CORPORATION
Selected Consolidated Financial Information
(In thousands except per share data)
(Unaudited)
Consolidated Statement of Operations Information:
Three months ended Nine months ended
September 30, September 30,
2003 2002 2003 2002
------- ------- ------- -------
Revenues $13,791 $12,555 $38,126 $34,751
Cost of Revenues 7,109 6,407 19,377 17,749
Gross Profit 6,682 6,148 18,749 17,002
Operating Expenses:
Research and Development 867 852 2,642 2,742
Selling, General and Administrative 2,798 2,502 8,255 7,304
Total Operating Expenses 3,665 3,354 10,897 10,046
Operating Income 3,017 2,794 7,852 6,956
Other Income, Net 101 165 338 625
Income Before Income Taxes 3,118 2,959 8,190 7,581
Income Tax Expense 1,138 1,080 2,989 2,767
Net Income 1,980 1,879 5,201 4,814
Net Income Per Basic Share $.22 $.22 $.59 $.55
Net Income Per Diluted Share $.20 $.20 $.54 $.51
Basic Weighted Average
Shares Outstanding 9,067 8,712 8,873 8,698
Diluted Weighted Average
Shares Outstanding 9,834 9,521 9.670 9,495
Consolidated Balance Sheet Information:
Balance as of
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September 30, December 31,
2003 2002
-------------- ------------
(Unaudited)
Cash and Marketable Securities $43,436 $36,337
Accounts Receivable 7,464 6,644
Inventories 4,128 3,042
Total Current Assets 56,165 47,337
Property and Equipment, Net 1,144 1,314
Total Assets 57,365 48,709
Current Liabilities 7,975 6,552
Stockholders' Equity 49,390 42,157
CONFERENCE CALL AND REPLAY
Rimage Corporation will review its third quarter operating results in a
conference call at 4:30 PM 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 will be available through October 29
by dialing 303-590-3000 and providing the 555192 confirmation code.