Attached files
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| 8-K - FORM 8-K DATED FEBRUARY 21, 2013 - Qumu Corp | rimage130874_8k.htm |
| EX-10.3 - FORM OF AMENDED AND RESTATED SEVERANCE/CHANGE IN CONTROL LETTER AGREEMENT - Qumu Corp | rimage130874_ex10-3.htm |
| EX-10.1 - LONG TERM INCENTIVE BONUS AGREEMENT - Qumu Corp | rimage130874_ex10-1.htm |
| EX-99.2 - STATEMENTS OF SHERMAN L. BLACK AND JAMES R. STEWART - Qumu Corp | rimage130874_ex99-2.htm |
| EX-10.2 - LONG TERM INCENTIVE BONUS AGREEMENT - Qumu Corp | rimage130874_ex10-2.htm |
EXHIBIT 99.1
Rimage Reports 56% Sequential Increase in Qumu Fourth
Quarter 2012
Revenues
Qumu Contracted Commitment Backlog Increases 50% from Third Quarter to $12.7 Million Overall Fourth Quarter 2012 Revenues of $20.7 Million Exceed Guidance
Minneapolis, MN – February 26, 2013 – Rimage Corporation (NASDAQ: RIMG) today reported its financial results for the fourth quarter and full year ended December 31, 2012.
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Qumu Fourth Quarter Financial Highlights |
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Qumu revenues totaled $4.3 million in the fourth quarter of 2012, 56% above the $2.8 million in the third quarter 2012 and more than double its $1.8 million in revenues in the fourth quarter of 2011. |
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Qumu contracted commitments totaled $8.7 million in the 2012 fourth quarter, the best quarterly performance in its history. This compares with $4.5 million in contracted commitments in the recent third quarter. Qumu’s backlog of contracted revenue grew to $12.7 million at December 31, 2012 compared with $8.4 million at September 30, 2012. |
Sherman L. Black, president and CEO, said, “The fourth quarter demonstrated the potential of our Qumu secure enterprise video solutions. Qumu’s momentum continued to build during the quarter with strong sequential growth in revenues, contracted commitments and backlog. Six new enterprise customers committed to Qumu’s enterprise video software and services, representing a broad spectrum of industries including food, pharma, high tech, financial services and transportation.”
“Enterprise customers are beginning to see video content used more and more as a means to increase employee engagement and team collaboration. Existing network infrastructure and collaboration tools are not equipped to enable the creation, management and delivery of video,” continued Mr. Black.
“Qumu allows organizations to capture, organize and distribute content across their extended enterprise to a wide variety of endpoints, including mobile devices. Qumu software offers information technology administrators and corporate communication leaders a way to securely address the challenges of video and rich content distribution overwhelming their data networks, while utilizing existing IT infrastructure.”
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Disc Publishing Fourth Quarter Financial Highlights |
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Disc publishing revenues in the recent fourth quarter totaled $16.4 million, a decrease of 17% from revenues in the fourth quarter of 2011. The decrease continued to reflect softness in demand in Europe and continued funding challenges with the government business in the U.S. |
“As expected, our disc publishing business remained challenging during the quarter, reflecting continued softness in the economies throughout Europe and budget issues faced by our government customers. We anticipate continued declines in disc publishing revenues. However, there are use cases like medical imaging and published financial information where there are high switching costs or the other technology alternatives are less viable. As a result, we believe the demand for disc publishing will continue into the future. We took actions in 2012 to reduce expenses in this business and continue to properly size our operating expense base to ensure this business remains a significant cash generator,” Mr. Black continued.
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Fourth Quarter 2012 Financial Highlights |
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Total revenues for the fourth quarter 2012 were $20.7 million, above the high end of guidance of $18 to $20 million. Compared with revenues in the 2011 fourth quarter of $21.7 million, recent fourth quarter revenues represented a 4% decline, reflecting a decrease in revenues from disc publishing, offset by higher revenues from Qumu, acquired October 10, 2011. |
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Gross margin for the fourth quarter of 2012 was 51%, approximately the same as the gross margin in the fourth quarter of 2011 but improved from 48% in the third quarter of 2012. The improvement from the 2012 third quarter reflected a higher mix of revenue from Qumu software. |
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Operating expenses in the quarter were $12.0 million, down from $12.8 million in the fourth quarter of 2011. Included in the recent fourth quarter results was approximately $0.5 million of one-time severance costs. |
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The net loss for the fourth quarter was $1.1 million, or $(0.12) per share, significantly better than the fourth quarter guidance of a loss between $(0.20) and $(0.33) per share. This compares with a net loss of $1.4 million in the fourth quarter of 2011, or $(0.13) per share. |
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Cash and marketable securities totaled $50.1 million at December 31, 2012. During the quarter, the Company repurchased 1.4 million shares of Rimage common stock for a total of $8.4 million. Fourth quarter cash used in operations totaled $0.2 million. |
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Full Year 2012 Highlights |
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Full year 2012 revenues were $79.4 million, compared with $83.6 million in 2011, driven by a decline in revenues from the disc publishing operation partially offset by an increase in revenue from Qumu software and services. |
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The Company reported a net loss of $48.3 million, or $(4.85) per share, for 2012. Included in the loss were three non-cash charges totaling $40.7 million taken in the third quarter of 2012. These non-cash charges included a $22.2 million goodwill impairment charge that eliminated all the goodwill on the balance sheet, a $7.3 million impairment charge for the reduction in the fair market value of amortizing intangible assets and an $11.2 million charge to establish a valuation allowance against the Company’s deferred tax assets. |
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Excluding these non-cash charges and the amortization of Qumu intangibles, the non-GAAP net loss was $5.7 million, or $(0.57) per share in 2012. This compares with net income of $2.8 million, or $0.29 per diluted share, in 2011. |
“As we look ahead, we are optimistic about our outlook. Qumu is our growth engine and our success in driving traction in this business in the second half of 2012 confirms our belief that we have strong differentiated solutions in the large and rapidly growing market for enterprise video communications. Our priorities during 2013 are to continue to drive significant revenue growth from Qumu, to maximize the cash generation from disc publishing, to maintain a healthy cash position and to drive toward improved profitability,” concluded Mr. Black.
For total year 2013, the Company expects consolidated revenues to grow compared to 2012. Qumu revenues are expected to grow greater than 50% in 2013 compared to 2012. The Company expects this Qumu growth to be partially offset by a decline in disc publishing revenues. Consolidated cash from operations is expected at approximately break even levels for the year. The Company has approximately 778,000 shares remaining on its repurchase authorization and may repurchase shares from time to time during the year depending on market conditions.
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Earnings per Share and Financial Guidance Reconciliation |
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Fourth Quarter 2012 |
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Full Year 2012 |
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GAAP earnings (loss) per share |
$(0.12 |
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$(4.85 |
) |
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Impact of amortization of intangibles |
$0.03 |
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$0.12 |
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Impact of non cash charges for goodwill impairment, intangible asset impairment and deferred tax valuation allowance |
$0.00 |
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$4.16 |
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Non-GAAP earnings (loss) per share |
$(0.09 |
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$(0.57 |
) |
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First Quarter 2013 |
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Estimated GAAP earnings (loss) per share |
$(0.18) - $(0.30 |
) |
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Estimated impact of amortization of intangibles |
$0.02 |
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Estimated Non-GAAP earnings (loss) per share |
$(0.16) - $(0.28 |
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Blu-ray Disc™ is a trademark of the Blu-ray Disc Association.
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Investor Contacts: |
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James Stewart, CFO |
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Rimage Corporation |
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952/944-8144 |
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Jenifer Kirtland |
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EVC Group |
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415/568-9349 |
RIMAGE CORPORATION
Selected Consolidated Financial Information
(In thousands except per share data)
(Unaudited)
Consolidated Statements of Operations Information:
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Three months ended |
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Year ended |
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2012 |
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2011 |
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2012 |
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2011 |
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Revenues |
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$ |
20,749 |
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$ |
21,663 |
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$ |
79,443 |
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$ |
83,634 |
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Cost of revenues |
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10,096 |
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10,721 |
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40,782 |
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41,613 |
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Gross profit |
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10,653 |
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10,942 |
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38,661 |
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42,021 |
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Operating expenses: |
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Research and development |
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2,909 |
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2,642 |
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11,866 |
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7,257 |
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Selling, general and administrative |
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8,900 |
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9,913 |
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36,039 |
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30,093 |
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Goodwill and intangible asset impairment charge |
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— |
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— |
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29,548 |
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— |
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Amortization of purchased intangibles |
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157 |
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223 |
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952 |
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223 |
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Total operating expenses |
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11,966 |
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12,778 |
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78,405 |
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37,573 |
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Operating income (loss) |
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(1,313 |
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(1,836 |
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(39,744 |
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4,448 |
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Other income (expense), net |
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(44 |
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57 |
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(44 |
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221 |
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Income (loss) before income taxes |
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(1,357 |
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(1,779 |
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(39,788 |
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4,669 |
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Income tax expense (benefit) |
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(199 |
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(382 |
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8,809 |
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1,997 |
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Net income (loss) |
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(1,158 |
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(1,397 |
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(48,597 |
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2,672 |
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Net loss attributable to noncontrolling interest |
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43 |
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46 |
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259 |
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163 |
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Net income (loss) attributable to Rimage |
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$ |
(1,115 |
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$ |
(1,351 |
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$ |
(48,338 |
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$ |
2,835 |
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Net income (loss) per basic share |
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$ |
(0.12 |
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$ |
(0.13 |
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$ |
(4.85 |
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$ |
0.29 |
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Net income (loss) per diluted share |
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$ |
(0.12 |
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$ |
(0.13 |
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$ |
(4.85 |
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$ |
0.29 |
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Basic weighted average shares outstanding |
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9,320 |
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10,207 |
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9,971 |
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9,674 |
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Diluted weighted average shares outstanding |
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9,320 |
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10,207 |
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9,971 |
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9,699 |
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Consolidated Balance Sheet Information:
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Balance as of |
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December 31, |
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December 31, |
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Cash and marketable securities |
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$ |
50,140 |
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$ |
70,161 |
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Receivables |
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13,055 |
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15,496 |
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Inventories |
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6,036 |
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6,198 |
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Total current assets |
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75,950 |
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98,437 |
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Property and equipment, net |
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5,966 |
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6,177 |
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Total assets |
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95,563 |
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157,660 |
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Current liabilities |
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19,807 |
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20,156 |
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Long-term liabilities |
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5,129 |
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5,204 |
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Noncontrolling interest |
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103 |
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360 |
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Rimage stockholders’ equity |
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70,524 |
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131,940 |
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