PRESS RELEASE
Dataram Contact: Investor Contact:
Mark Maddocks, Joe Zappulla
Vice President-Finance, CFO Wall Street Consultants Corp.
609-799-0071 212-681-4100
info@dataram.com JZappulla@WallStreetIR.com
DATARAM REPORTS FISCAL 2007 SECOND QUARTER FINANCIAL
RESULTS
Revenues and Order Rate Continue To Improve
Net Earnings Total $0.16 per Diluted Share
Board of Directors Declares Regular Quarterly $0.06 Per Share Dividend
PRINCETON, N.J. November 15, 2006 - Dataram Corporation (NASDAQ: DRAM) today
reported its financial results for its fiscal second quarter and six months
ended October 31, 2006. Revenues for second quarter increased to $10.9
million from $9.3 million in the first quarter and $8.8 million in the fourth
quarter of fiscal year 2006 and compares to $9.9 million for the second
quarter of the prior fiscal year. Revenues for the first six months of the
current fiscal year were $20.2 million versus $23.8 million for the comparable
prior year period.
Net earnings for the second quarter totaled $1.4 million, or $0.16 per diluted
share, which compares to net earnings of $352,000, or $0.04 per diluted share
for the second quarter of the prior fiscal year. Net earnings for the first
six months of the current fiscal year were $1.4 million, or $0.16 per diluted
share, versus $1.3 million, or $0.15 per diluted share, for the comparable
prior year period. Net earnings for the second quarter and six months of the
current fiscal year included a payment of $2.3 million from a DRAM
manufacturer related to a settlement agreement that the Company entered into
in the quarter. The payment is recorded as other income in the Company's
financial statements for the second fiscal quarter and six months ended
October 31, 2006.
Second quarter highlights:
Revenues increase 17 percent on a sequential quarterly basis
Order rate improves to $10.5 million, or 8 percent, on a sequential
quarterly basis
Board of Directors declares regular quarterly dividend of $0.06 per share
Robert V. Tarantino, Dataram's chairman and CEO commented, "We continue to
make progress with our strategy to expand our customer base of large corporate
end-users and value-added resellers. Our revenue growth was led by growth in
the compatible memory market, which this strategy addresses and grew by 30
percent on a sequential quarterly basis. Also, importantly, our overall order
rate in the second quarter continued to improve and this marks the third
consecutive increase in our level of incoming orders."
Gross margin during the second quarter averaged 24 percent, which compares to
the first quarter level of 26 percent and compares to 30 percent in the second
quarter of last fiscal year. Gross margin in both quarters of the current
fiscal year is within what the Company considers its normal range. Second
quarter and six month expenses of the current fiscal year include $117,000 and
$251,000, respectively, of stock option expense compared to zero in the prior
year comparable periods. The Company was required to commence expensing stock
options at the beginning of the current fiscal year. Excluding stock option
expense, selling, general and administrative costs for the second quarter were
$2.3 million compared to $2.3 million in the first quarter and $2.5 million
for the second quarter of last fiscal year. The Company's backlog at the end
of the second quarter was $961,000.
Mr. Tarantino concluded, "Our financial condition is strong and we are highly
liquid. Today, the Company's Board of Directors declared a quarterly dividend
of $0.06 per common share. The dividend will be payable on December 13, 2006,
to shareholders of record as of November 29, 2006."
As announced in a previously issued press release, Dataram will conduct a
conference call today at 4:30 p.m. (EST) to present its second quarter
financial results and to respond to investor questions. Interested
shareholders may participate in the call by dialing 800-732-6094, providing
the following reservation number: 21309633. It is recommended that
participants call 10 minutes before the conference call is scheduled to begin.
The conference call can also be accessed over the Internet through Vcall at
www.vcall.com. A replay of the call will be available approximately one hour
after the completion of the conference call through Vcall and for 24 hours by
dialing 800-633-8284 or 402-977-9140 and entering the reservation number
listed above.
ABOUT DATARAM CORPORATION
Dataram is a worldwide leader in the design and manufacture of high capacity,
reliable and innovative memory solutions. With over 39 years of experience,
Dataram provides customized memory solutions for OEMs and compatible memory
for leading brands including HP, Dell, IBM, SGI, Sun Microsystems and Intel.
For more information about Dataram, visit www.dataram.com
The information provided in this press release may include forward-looking
statements relating to future events, such as the development of new products,
pricing and availability of raw materials or the future financial performance
of the Company. Actual results may differ from such projections and are
subject to certain risks including, without limitation, risks arising from:
changes in the price of memory chips, changes in the demand for memory
systems, increased competition in the memory systems industry, order
cancellations, delays in developing and commercializing new products and other
factors described in the Company's most recent Annual Report on Form 10-K,
filed with the Securities and Exchange Commission, which can be reviewed at
http://www.sec.gov.
Financial Tables Follow
DATARAM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGSS
(In thousands, except per share amounts)
(Unaudited)
Second Quarter Ended Six Months
October 31, October 31,
____________________ _______________
2006 2005 2006 2005
Revenues $10,902 $ 9,858 $20,207 $23,802
Costs and expenses:
Cost of sales 8,325 6,886 15,226 16,632
Engineering and development 320 293 626 559
Selling, general
and administrative 2,265 2,282 4,572 4,775
Stock option expense* 117 0 251 0
_______ _______ _______ _______
11,027 9,461 20,675 21,966
_______ _______ _______ _______
Earnings (loss)
from operations (125) 397 (468) 1,836
Other income 2,436 168 2,672 219
_______ _______ _______ _______
Earnings before income taxes 2,311 565 2,204 2,055
Income tax provision 865 213 828 771
_______ _______ _______ _______
Net earnings $ 1,446 $ 352 $ 1,376 $ 1,284
======= ======= ======= =======
Net earnings per share:
Basic $ 0.17 $ 0.04 $ 0.16 $ 0.15
======= ======= ======= =======
Diluted $ 0.16 $ 0.04 $ 0.16 $ 0.15
======= ======= ======= =======
Weighted average number
of shares outstanding:
Basic 8,576 8,441 8,411 8,441
======= ======= ======= =======
Diluted 8,805 8,941 8,829 8,829
======= ======= ======= =======
*Stock option expense is recorded as a component of selling, general and
administrative expenses in the Company's financial statements filed with the
Securities and Exchange Commission on Form 10-Q.
DATARAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
October 31, 2006 April 30, 2006
ASSETS
Current assets
Cash and cash equivalents $ 13,563 $ 14,044
Trade receivables, net 5,582 4,893
Inventories 4,111 2,189
Deferred income taxes 1,365 1,365
Note receivable 1,537 1,537
Other current assets 315 80
___________________________________
Total current assets 26,473 24,108
Deferred income taxes 530 1,176
Property and equipment, net 891 847
Other assets 105 105
___________________________________
Total assets $ 27,999 $ 26,236
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 2,979 $ 2,057
Accrued liabilities 621 653
___________________________________
Total current liabilities 3,600 2,710
Stockholders' equity 24,399 23,526
___________________________________
Total liabilities and stockholders'
equity $ 27,888 $ 26,236
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