PRESS RELEASE
Dataram Contact
Mark Maddocks
Vice President-Finance, CFO
609-799-0071
info@dataram.com
DATARAM REPORTS FISCAL 2011 FIRST QUARTER FINANCIAL RESULTS
PRINCETON, N.J. September 2, 2010 - Dataram Corporation (NASDAQ: DRAM) today
reported its financial results for its fiscal first quarter ended July 31,
2010. Revenues for the first quarter were $12.7 million, which compares to
$9.2 million for the comparable prior year period and also compares to $11.9
million for the prior sequential quarter. The Company incurred a pre-tax net
loss for the first quarter of the current fiscal year of $1.2 million which
compares to a pre-tax net loss of $1.6 million for the comparable prior year
period and a pre-tax net loss of $1.6 million for the prior sequential
period.
John H. Freeman, Dataram's president and CEO commented, "Our memory
solutions business continued to grow in our fiscal first quarter. The
implementation of our sales and marketing strategy coupled with the gradual
economic recovery is having a positive effect on demand for our products and
our memory business is increasingly cash profitable."
Mr. Freeman stated, "The release schedule and development of our XcelaSAN
product line is on track. Subsequent to the first quarter, we released the
product with enhanced features and functionality which increases its ease of
use, ease of installation and interoperability. We have accepted our first
purchase order for this released version of XcelaSAN and have delivered and
successfully installed the system. High Availability systems are still
expected to be available for sale in December. We anticipate that our
enhancements and the shipment of high availability systems will accelerate
product sales and broaden market adoption. XcelaSAN is a unique intelligent
Storage Area Network (SAN) optimization solution that delivers substantive
application performance improvement to applications such as Oracle, SQL and
VMware. XcelaSAN augments existing storage systems by transparently applying
intelligent caching algorithms that serve the most active block-level data
from high-speed storage, creating an intelligent, virtual solid state SAN.
This breakthrough solution allows organizations to dramatically increase the
performance of their business-critical applications without the costly
hardware upgrades or over-provisioning of storage typically found in current
solutions for increased performance.
Mr. Freeman continued, "We are continuing our investments in research and
development in XcelaSAN and recognized that we required external financing
to continue these investments. In July 2010, we entered into an agreement
with a financial institution for secured debt financing of up to $5.0
million. Also in July 2010, we entered into an agreement with a related
party vendor to consign up to $3.0 million of certain inventory into our
manufacturing facilities. This will allow us to substantially reduce our
inventory carrying requirements while still maintaining our ability to
service our customers. We expect that these two agreements together with
cash generated from our memory solutions business will generate sufficient
liquidity for us to meet our operating plans for fiscal 2011."
The Company's net loss for the first quarter was of $1,239,000, or $0.14 per
share which compares to net loss of $978,000, or $0.11 per share for the
comparable prior year period. The prior fiscal year's first quarter net loss
includes an income tax benefit of $628,000 on which the Company subsequently
placed a 100% valuation allowance in its third quarter of fiscal 2010.
Mr. Freeman concluded, "The turnaround of our memory solutions business is
on track. Our memory solutions business is generating positive cash flow and
growing. Our outlook for XcelaSAN is very robust, particularly as we move
into High Availability systems later this year. We expect that the
enhancements under development will further strengthen our value proposition
and sales."
ABOUT DATARAM CORPORATION
Founded in 1967, Dataram is a worldwide leader in the manufacture of high-
quality computer memory, storage and software products. Our products and
services deliver IT infrastructure optimization, dramatically increase
application performance and deliver substantial cost savings. Dataram
solutions are deployed in 70 Fortune 100 companies and in mission-critical
government and defense applications around the world. 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)
First Quarter Ended July 31
___________________________
2010 2009
Revenues $ 12,744 $ 9,190
Costs and expenses:
Cost of sales 9,621 6,655
Engineering and development 261 253
Research and development 871 874
Selling, general and administrative 2,855 2,728
Stock-based compensation expense* 158 156
Intangible asset amortization expense: 107 164
_________ ________
13,783 10,830
_________ ________
Loss from operations (1,129) (1,640)
Other income (expense) (109) 34
_________ ________
Loss before income taxes (1,239) (1,606)
Income tax benefit 0 (628)
_________ ________
Net loss $ (1,239) $ (978)
========= ========
Net loss per share:
Basic $ (0.14) $ (0.11)
========= =========
Diluted $ (0.14) $ (0.11)
========= =========
Weighted average number of shares
outstanding:
Basic 8,918 8,869
========= ========
Diluted 8,918 8,869
========= ========
*Items are recorded as a component of operating costs and 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)
July 31, 2010 April 30, 2010
ASSETS
Current assets
Cash and cash equivalents $ 786 $ 2,507
Accounts receivable, net 5,495 5,344
Inventories 5,748 6,872
Other current assets 209 87
__________________________________
Total current assets 12,238 14,810
Property and equipment, net 942 1,117
Other assets 100 105
Intangible assets, net 760 867
Goodwill 1,020 754
__________________________________
Total assets $ 15,060 $ 17,653
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 2,015 $ 3,523
Accrued liabilities 1,734 1,738
Note payable to related party 1,000 1,000
__________________________________
Total current liabilities 4,749 6,261
Stockholders' equity 10,311 11,392
__________________________________
Total liabilities and stockholders'
equity $ 15,060 $ 17,653
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