PRESS RELEASE
Dataram Contact:
Mark Maddocks
Vice President-Finance, CFO
609-799-0071
info@dataram.com
DATARAM REPORTS FISCAL 2008 THIRD QUARTER FINANCIAL RESULTS
Company Reports Net Earnings of $0.03 Per Share
Board of Directors Declares Regular Quarterly Dividend
PRINCETON, N.J. February 19, 2008 - Dataram Corporation (NASDAQ: DRAM) today
reported its financial results for its fiscal third quarter and nine months
ended January 31, 2008. Net earnings for the third quarter of the current
fiscal year were $233,000, or $0.03 per diluted share, which compares to a
net loss of $298,000, or $0.03 per diluted share for the third quarter of the
prior fiscal year. Net earnings for the first nine months of the current
fiscal year were $1,208,000, or $0.14 per diluted share, which compares to
net earnings of $1,079,000, or $0.12 per diluted share for the comparable
prior year period. Prior year nine months net earnings included a one-time
payment of $2.3 million from a DRAM manufacturer related to a settlement
agreement. The Company's earnings from operations for the third quarter and
first nine months of the current fiscal year totaled $214,000 and $1,307,000,
respectively, and compares to operating losses of $684,000 and $1,151,000 for
the comparable prior year periods.
Revenues for the third quarter and first nine months of the current fiscal
year were $6.7 million and $23.8 million, respectively, which compares to
$9.4 million and $29.6 million for the comparable prior year periods.
Robert V. Tarantino, Dataram's chairman and CEO commented, "While we
experienced typical seasonal slowness in our third quarter, our year over
year performance continues to improve. Our third quarter and year to date
operating earnings and net earnings met our planned profit objectives and our
operating earnings have improved significantly over last fiscal year's loss
levels."
Mr. Tarantino continued, "Our third quarter revenues reflected a seasonal
decline in business from some of our key customers. This was not unusual and
we expect to experience the typical improvement in our business level with
these customers in our fiscal fourth quarter. Additionally, our revenues
this entire fiscal year have been adversely impacted by reductions in our
selling prices as a result of the well-publicized decline in the price of
DRAM chips, the primary raw material in our products. Typically, the average
selling price (ASP) of DRAMs decline by approximately 25 percent per year.
Industry reports estimate the industry decline in ASP to be 31 percent in the
last quarter alone. Over the last twelve months, the Company's purchase
price of the DRAMs used in our products has declined by approximately 50
percent. This has resulted in a much larger than anticipated reduction in
our selling prices as we passed our cost savings through to our customers.
The DRAM market is a volatile, global commodity market and we have no control
over the price dynamics of that market. We do see signs that the rate of
price decline of DRAMs is abating and are hopeful that the recent price
trends we have seen will continue."
The Company's operating expenses for the third quarter and first nine months
of the current fiscal year totaled $2,430,000 and $7,616,000, respectively,
and compare to operating expenses of $2,545,000 and $7,995,000 for the
comparable prior year periods. The decline in expenses was the result of
cost reductions initiated at the end of the prior fiscal year as well as a
reduction in stock-based compensation expense.
The Company accrues federal and state income taxes at a combined rate of
approximately 39 percent. However, since the Company entered the fiscal year
with a federal net operating loss ("NOL") carryforward of approximately $4.7
million, the Company actually pays income taxes at a rate of approximately 10
percent as it utilizes the tax benefits of its NOL carryforward.
Mr. Tarantino concluded, "We are meeting our profit objectives and our strong
cash and working capital position continued to improve. In the first nine
months of the current fiscal year, cash provided by operating activities
totaled $3,543,000, and cash and equivalents increased to $18,156,000.
Working capital at the end of the third quarter amounted to $22,345,000 and
our current ratio is 16.0. Our tangible book value per share is $2.67, of
which, cash and equivalents constitutes $2.05 per share. The Company's Board
of Directors has declared a quarterly dividend of $0.06 per common share.
The dividend will be payable on March 14, 2008, to shareholders of record as
of February 29, 2008. At January 31, 2008, there were 8,869,184 common
shares issued and outstanding."
ABOUT DATARAM CORPORATION
Dataram is a worldwide leader in the design and manufacture of high capacity,
reliable and innovative memory solutions. With over 40 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
___________________ _________________
2008 2007 2008 2007
Revenues $ 6,676 $ 9,366 $ 23,848 $ 29,574
Costs and expenses:
Cost of sales 4,032 7,505 14,925 22,730
Engineering and development 313 295 900 922
Selling, general
and administrative 2,051 2,155 6,485 6,727
Stock-based compensation
expense* 66 95 231 346
________ ________ ________ ________
6,462 10,050 22,541 30,725
________ ________ ________ ________
Earnings (loss)
from operations 214 (684) 1,307 (1,151)
Other income 233 213 681 2,885
________ ________ ________ ________
Earnings (loss) before
income taxes 447 (471) 1,988 1,734
Income tax provision (benefit) 214 (173) 780 655
________ ________ ________ ________
Net earnings (loss) $ 233 $ (298) $ 1,208 $ 1,079
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Net earnings (loss) per share:
Basic $ 0.03 $ (0.03) $ 0.14 $ 0.13
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Diluted $ 0.03 $ (0.03) $ 0.14 $ 0.12
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Weighted average number of
shares outstanding:
Basic 8,869 8,669 8,811 8,549
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Diluted 8,875 8,669 8,851 8,800
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*Stock-based compensation 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, 2008 April 30, 2007
ASSETS
Current assets
Cash and cash equivalents $ 18,156 $ 14,138
Accounts receivable, net 2,629 4,717
Inventories 1,710 2,121
Deferred income taxes 1,134 1,149
Note receivable 0 1,537
Other current assets 207 231
________________________________________
Total current assets 23,836 23,893
Deferred income taxes 675 1,123
Property and equipment, net 587 784
Other assets 79 105
________________________________________
Total assets $ 25,177 $ 25,905
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LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities
Accounts payable $ 757 $ 1,597
Accrued liabilities 734 976
________________________________________
Total current liabilities 1,491 2,573
Stockholders' equity 23,686 23,332
________________________________________
Total liabilities and
stockholders' equity $ 25,177 $ 25,905
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