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 THIRD QUARTER FINANCIAL
RESULTS
Board of Directors Declares Regular Quarterly $0.06 Per Share Dividend
PRINCETON, N.J. February 22, 2007 - Dataram Corporation (NASDAQ: DRAM) today
reported its financial results for its fiscal third quarter and nine months
ended January 31, 2007. Revenues for third quarter were $9.4 million
compared to $9.2 million in the third quarter of the prior fiscal year and
$10.9 million in the second quarter of the current fiscal year. Revenues for
the first nine months of the current fiscal year were $29.6 million versus
$33.0 million for the comparable prior year period. Last fiscal year's
revenues included $3.0 million in the first quarter of the year from sales to
one OEM customer with whom the Company no longer transacts business.
Gross margins during the third quarter averaged 20 percent, which is lower
than what the Company considers its normal range. This was primarily the
result of reduced absorption of factory costs in the third quarter that was a
result of the lower sequential quarterly volume. The Company considers gross
margins of 25 percent, plus or minus 3 percent, normal.
Robert V. Tarantino, Dataram's chairman and CEO commented, " The third
quarter is normally a seasonally weak quarter and the sequential quarterly
revenue decline is not unusual. We are making progress. On a comparable
quarterly basis we have achieved revenue growth of two percent and for the
year to date nine-month period, we have achieved a six percent increase in
revenue over the preceding sequential nine-month period. As we enter our
fourth quarter, our order rate has improved, which is also typical. We
anticipate that our margins will return to normal in the fourth quarter as
well."
The Company incurred a net loss of $298,000 or $0.03 per share for the third
quarter of fiscal 2007. This compares to net earnings of $1.4 million or
$0.16 per diluted share for the second quarter of the current fiscal year,
which included a payment of $2.3 million from a DRAM manufacturer related to
a settlement agreement that the Company entered into during the quarter.
This compares to net earnings of $1.4 million or $0.16 per diluted share for
the third quarter of the previous fiscal year, which included a gain of $1.9
million from the sale of undeveloped land owned by the Company. For the
first nine months of the current fiscal year, net earnings totaled $1.1
million or $0.12 per diluted share versus $2.7 million or $0.30 per diluted
share for the comparable prior fiscal year period. The $2.3 million
settlement payment is recorded as other income in the Company's financial
statements for the nine months ended January 31, 2007. The $1.9 million gain
on sale of the land was recorded as other income in the comparable prior year
period
Third quarter and nine month expenses of the current fiscal year include
$95,000 and $346,000, 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 third quarter of both the current and prior fiscal year totaled $2.2
million.
The Company's backlog at the end of the third quarter was $1,028,000, which
compares to $961,000 at the end of the second quarter and $635,000 at the end
of the third quarter of the prior fiscal year.
Mr. Tarantino concluded, " Our financial condition is strong and we are
highly liquid. The Company's Board of Directors has declared a quarterly
dividend of $0.06 per common share. The dividend will be payable on March
21, 2007, to shareholders of record as of March 7, 2007."
As announced in a previously issued press release, Dataram will conduct a
conference call today at 4:30 p.m. (EST) to present its third quarter
financial results and to respond to investor questions. Interested
shareholders may participate in the call by dialing 800-732-9382, providing
the following reservation number: 21330162. 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 OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Third Quarter Ended Nine Months Ended
January 31, January 31,
____________________ __________________
2007 2006 2007 2006
Revenues $ 9,366 $ 9,220 $ 29,574 $ 33,022
Costs and expenses:
Cost of sales 7,505 6,520 22,730 23,152
Engineering and development 295 287 922 847
Selling, general and
administrative 2,155 2,175 6,727 6,950
Stock option expense* 95 0 346 0
________ ________ ________ ________
10,050 8,892 30,725 30,949
________ _________ ________ ________
Earnings (loss)
from operations (684) 238 (1,151) 2,073
Other income 213 2,030 2,885 2,249
________ _________ ________ ________
Earnings (loss) before
income taxes (471) 2,268 1,734 4,322
Income tax provision (benefit) (173) 863 655 1,634
________ _________ ________ ________
Net earnings (loss) $ (298) $ 1,405 $ 1,079 $ 2,688
======== ========= ======== ========
Net earnings (loss) per share:
Basic $ (0.03) $ 0.17 $ 0.13 $ 0.32
======== ========= ======== ========
Diluted $ (0.03) $ 0.16 $ 0.12 $ 0.30
======== ========= ======== ========
Weighted average number
of shares outstanding:
Basic 8,669 8,472 8,549 8,431
======== ========= ======== ========
Diluted 8,669 8,831 8,800 8,825
======== ========= ======== ========
*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)
January 31, 2007 April 30, 2006
ASSETS
Current assets
Cash and cash equivalents $ 13,881 $ 14,044
Trade receivables, net 4,309 4,893
Inventories 2,539 2,189
Deferred income taxes 1,365 1,365
Note receivable 1,537 1,537
Other current assets 285 80
____________________________________
Total current assets 23,916 24,108
Deferred income taxes 685 1,176
Property and equipment, net 831 847
Other assets 105 105
____________________________________
Total assets $ 25,537 $ 26,236
====================================
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 1,180 $ 2,057
Accrued liabilities 625 653
____________________________________
Total current liabilities 1,805 2,710
Stockholders' equity 23,732 23,526
____________________________________
Total liabilities and
stockholders' equity $ 25,537 $ 26,236
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