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8-K - FORM 8-K - EMERSON RADIO CORP | c19895e8vk.htm |
Exhibit 99.1
NEWS & INFORMATION
FOR:
|
EMERSON RADIO CORP. | |
85 Oxford Drive | ||
Moonachie, NJ 07074 | ||
CONTACT:
|
Investor Relations: | |
Robert Maffei | ||
Investor Relations Manager | ||
(973) 428-2098 |
Thursday, July 14, 2011
EMERSON RADIO CORP. REPORTS FULL YEAR FISCAL 2011 AND FOURTH QUARTER FISCAL 2011 RESULTS
MOONACHIE, N.J. July 14, 2011 Emerson Radio Corp. (NYSE AMEX: MSN) today reported financial
results for its full year and fourth quarter ended March 31, 2011.
Net income from continuing operations for the fiscal year 2011 was $15.9 million versus $11.4
million for fiscal year 2010, an increase of $4.5 million, or 40.0%. Diluted earnings per share for
the fiscal year 2011 were $0.59 as compared to $.42 for fiscal year 2010, an increase of $0.17 per
diluted share, or 40.5%. Net income from continuing operations for the fourth quarter of fiscal
2011, which included a one-time $1.8 million gain on a settlement of litigation, was $2.6 million
versus $3.6 million for the fourth quarter of fiscal 2010, a decrease of $1.0 million, or 26.4%.
Diluted earnings per share for the fourth quarter of fiscal 2011 were $0.10 as compared to $0.13
for the fourth quarter of fiscal 2010, a decrease of $0.03, or 23.1%.
Operating income for the fiscal year 2011, despite lower net revenues, was $18.9 million, an
increase of $5.1 million, or 37.3%, over operating income of $13.8 million for fiscal year 2010 on
significantly lower SG&A expenses and other operating costs. Operating income for the fourth
quarter of fiscal 2011 was $3.2 million as compared to operating income in the fourth quarter of
fiscal 2010 of $4.3 million, a decrease of $1.1 million, or 26.4%. The decrease in fourth quarter
fiscal 2011 operating income over the prior year was driven primarily by lower net revenues,
partially offset by significant decreases in SG&A expenses and other operating costs.
Net revenues for fiscal year 2011 were $200.8 million, a decrease of $6.2 million, or 3.0%, over
the fiscal year 2010 net revenues of $207.0. The decline in year-over-year net revenues was driven
by a $19.3 million, or 55.1% decline in net sales of audio products, the absence in the fiscal year
2011 of themed
product sales, which were $3.2 million in the fiscal year 2010 and discontinued in December 2009,
and the inclusion in net revenues in the fourth fiscal quarter of 2010 of a one-time sale of
semiconductors of $3.0 million, partially offset by a $18.4 million, or 11.4% increase in net sales
of houseware products, which was the result of increased net sales of compact refrigerators,
microwave ovens, and wine coolers, partially offset by decreased net sales of toaster ovens and
coffee makers. Licensing revenues for the fiscal year 2011 were $7.3 million, a $0.4 million, or
5.3% increase over the $6.9 million of licensing revenues for the fiscal year 2010.
Net revenues for the fourth quarter of fiscal 2011 decreased by $10.4 million, or 20.2%, to $41.1
million as compared to net revenues in the fourth quarter of fiscal 2010 of $51.5 million. The
decline in year-over-year net revenues for the fourth fiscal quarter was driven by a $3.5 million,
or 58.3%, decline in net sales of audio products, a $3.4 million, or 8.5%, decline in net sales of
houseware products, which was the result of decreased net sales of microwave ovens, toaster ovens
and wine coolers, partially offset by increased net sales of compact refrigerators and coffee
makers, and the inclusion in net revenues in the fourth fiscal quarter of 2010 of a one-time sale
of semiconductors of $3.0 million. Licensing revenues for the fourth quarter of fiscal 2011 were
$2.0 million, unchanged from the fourth quarter of fiscal 2010.
Adrian Ma, Chief Executive Officer of Emerson Radio, commented Despite a challenging fourth
quarter, our full year fiscal 2011 operating and net income of $18.9 million and $15.9 million,
respectively, were both significantly higher than the prior fiscal year level due primarily to our
lower year-over-year levels of SG&A and operating costs, and the positive monetary settlement paid
to the Company during the fiscal year in settlement of the derivative shareholder lawsuit
originally filed in 2008. Looking forward, we see a challenging and highly competitive sales
environment as well as higher product costs due to the continuing appreciation of the renminbi and
increases in costs of production in China.
About Emerson Radio Corp.
Emerson Radio Corporation (NYSE AMEX: MSN), founded in 1948, is headquartered in Moonachie, N.J.
The Company designs, sources, imports and markets a variety of houseware and consumer electronic
products, and licenses its trademarks to others on a worldwide basis for a variety of products. For
more information, please visit Emerson Radios Web site at www.emersonradio.com.
Forward Looking Statements
This release contains forward-looking statements made pursuant to the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect
managements current knowledge, assumptions, judgment and expectations regarding future performance
or events. Although management believes that the expectations reflected in such statements are
reasonable, they give no assurance that such expectations will prove to be correct and you should
be aware that actual results could differ materially from those contained in the forward-looking
statements. Forward-looking statements are subject to a number of risks and uncertainties,
including the risk factors detailed in the Companys reports
as filed with the Securities and Exchange Commission. The Company assumes no obligation to update
the information contained in this news release.
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except earnings per share data)
Three Months Ended | Twelve Months Ended | |||||||||||||||
March 31, | March 31, | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
Net revenues: |
||||||||||||||||
Net revenues |
$ | 41,149 | $ | 51,549 | $ | 200,841 | $ | 206,960 | ||||||||
Costs and expenses: |
||||||||||||||||
Cost of sales |
36,425 | 42,861 | 172,917 | 175,463 | ||||||||||||
Other operating costs and expenses |
58 | 571 | 1,636 | 3,134 | ||||||||||||
Selling, general and administrative expenses |
1,464 | 3,769 | 7,383 | 14,598 | ||||||||||||
37,947 | 47,201 | 181,936 | 193,195 | |||||||||||||
Operating income |
3,202 | 4,348 | 18,905 | 13,765 | ||||||||||||
Other income (expense): |
||||||||||||||||
Gain on settlement of litigation |
1,806 | | 1,806 | |||||||||||||
Realized gain on sale of marketable securities |
| | 966 | | ||||||||||||
Interest income (expense), net |
8 | (45 | ) | 32 | (24 | ) | ||||||||||
Income from continuing operations before income taxes |
5,016 | 4,303 | 21,709 | 13,741 | ||||||||||||
Provision for income taxes |
2,384 | 728 | 5,791 | 2,371 | ||||||||||||
Income from continuing operations |
2,632 | 3,575 | 15,918 | 11,370 | ||||||||||||
Loss from discontinued operations, net of tax benefit |
| | | (55 | ) | |||||||||||
Net income |
$ | 2,632 | $ | 3,575 | $ | 15,918 | $ | 11,315 | ||||||||
Basic net income per share: |
||||||||||||||||
Continuing operations |
0.10 | 0.13 | 0.59 | 0.42 | ||||||||||||
Discontinued operations |
| | | | ||||||||||||
0.10 | 0.13 | 0.59 | 0.42 | |||||||||||||
Diluted net income per share: |
||||||||||||||||
Continuing operations |
0.10 | 0.13 | 0.59 | 0.42 | ||||||||||||
Discontinued operations |
| | | | ||||||||||||
0.10 | 0.13 | 0.59 | 0.42 | |||||||||||||
Weighted average shares outstanding: |
||||||||||||||||
Basic |
27,130 | 27,130 | 27,130 | 27,130 | ||||||||||||
Diluted |
27,130 | 27,132 | 27,130 | 27,131 |
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands except share data)
CONSOLIDATED BALANCE SHEETS
(In thousands except share data)
31-Mar-11 | 31-Mar-10 | |||||||
ASSETS |
||||||||
Current Assets: |
||||||||
Cash and cash equivalents |
$ | 39,056 | $ | 15,051 | ||||
Restricted cash |
740 | 1 | ||||||
Net accounts receivable |
10,929 | 20,350 | ||||||
Other receivables |
1,413 | 1,037 | ||||||
Net inventory |
8,515 | 10,952 | ||||||
Prepaid expenses and other current assets |
549 | 736 | ||||||
Investments in marketable securities |
4,725 | | ||||||
Deferred tax assets |
2,825 | 3,383 | ||||||
Total Current Assets |
68,752 | 51,510 | ||||||
Property, plant, and equipment, net |
2,921 | 3,131 | ||||||
Trademarks and other intangible assets, net |
1,545 | 1,606 | ||||||
Due from affiliates |
| 185 | ||||||
Investments in marketable securities |
| 6,031 | ||||||
Deferred tax assets |
2,540 | 6,588 | ||||||
Other assets |
958 | 205 | ||||||
Total Assets |
$ | 76,716 | $ | 69,256 | ||||
LIABILITIES AND SHAREHOLDERS EQUITY |
||||||||
Current Liabilities: |
||||||||
Short-term borrowings |
$ | 2,466 | $ | 5,629 | ||||
Current maturities of long-term borrowings |
46 | 30 | ||||||
Accounts payable and other current liabilities |
14,408 | 20,776 | ||||||
Due to affiliates |
2 | 28 | ||||||
Accrued sales returns |
1,199 | 957 | ||||||
Income taxes payable |
196 | 174 | ||||||
Total Current Liabilities |
18,317 | 27,594 | ||||||
Long-term borrowings |
150 | 201 | ||||||
Deferred tax liabilities |
158 | 119 | ||||||
Total Liabilities |
18,625 | 27,914 | ||||||
Shareholders Equity: |
||||||||
Preferred shares 10,000,000 shares authorized;
3,677 shares issued and outstanding; liquidation
preference of $3,677 |
3,310 | 3,310 | ||||||
Common shares $0.01 par value, 75,000,000
shares authorized; 52,965,797 shares issued and
27,129,832 shares outstanding |
529 | 529 | ||||||
Capital in excess of par value |
98,785 | 98,785 | ||||||
Accumulated other comprehensive losses |
746 | (82 | ) | |||||
Accumulated deficit |
(21,055 | ) | (36,976 | ) | ||||
Treasury stock, at cost, 25,835,965 shares |
(24,224 | ) | (24,224 | ) | ||||
Total shareholders equity |
58,091 | 41,342 | ||||||
Total Liabilities and Shareholders Equity |
$ | 76,716 | $ | 69,256 | ||||