Ampex Corporation Reports Q1 2006 Financial Results.REDWOOD CITY Redwood City, city (1990 pop. 66,072), seat of San Mateo co., W Calif., on San Francisco Bay; inc. 1868. Manufactures include commmunications, electrical, electronic, and medical equipment. , Calif. -- Ampex (Ampex Corporation, Redwood City, CA, www.ampex.com) A manufacturer of video storage and image processing products. Founded in 1944 by Alexander M. Poniatoff, Ampex pioneered the video recording industry, introducing the first videotape recorder in 1956 and providing innovative products Corporation (Nasdaq:AMPX) today reported a net loss of $1.9 million ($0.49 loss per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share) on revenues of $8.1 million in the first quarter of 2006 compared to net income of $5.9 million ($1.52 per diluted share) on revenues of $17.9 million in the first quarter of 2005. Results in 2006 were adversely affected by the absence of any one-time one-time adj. 1. or one·time a. Occurring or undertaken only once: a one-time winner in 1995. b. licensing settlements, as well as an increase in external litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. costs incurred in connection with the lawsuit lawsuit: see procedure; tort. against Eastman Kodak (company) Kodak - The photographic company responsible for Photo CD. http://kodak.com/. Company for infringement The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark. of one of our patents used in digital still cameras. Other matters affecting first quarter 2006 financial results included: --Running royalties recognized on current period shipments by our licensees totaled $2.6 million in the first quarter of 2006 and $2.1 million in the first quarter of 2005 due to additional digital still camera licensing agreements completed later in 2005. In the first quarter of 2005, one-time payments for prior period shipments and, in some cases, prepayment Prepayment 1. The payment of a debt obligation prior to its due date. 2. The excess payment over a scheduled debt repayment amount. Notes: 1. Examples include deferred expenses such as rent and early loan repayments. 2. of license obligations covering future periods totaled $9.3 million and were recognized in licensing revenues. There were no such settlements in 2006. --We continue to meet with licensees to determine whether any other of our digital imaging patents, including feed forward quantization (1) The division of a range of values into a single number, code or classification. For example, class A is 0 to 999, class B is 1000 to 9999 and class C is 10000 and above. (2) In analog to digital conversion, the assignment of a number to the amplitude of a wave. , are being used in their products. Royalties on digital still cameras after April 2006 will be materially dependent on these discussions. --The Sony SONY Standard Oil of New York (common, but untrue; it's an urban legend) prepayment of $40 million received in 2004 expired ex·pire v. ex·pired, ex·pir·ing, ex·pires v.intr. 1. To come to an end; terminate: My membership in the club has expired. 2. on April 11, 2006. After that date, Sony is obligated ob·li·gate tr.v. ob·li·gat·ed, ob·li·gat·ing, ob·li·gates 1. To bind, compel, or constrain by a social, legal, or moral tie. See Synonyms at force. 2. To cause to be grateful or indebted; oblige. to pay us royalties on products that they ship that incorporate our technology. We expect licensing revenues from digital camcorders to increase materially from current running royalty levels, since it is our belief that several of our patents are used in their products. Such payments are expected to begin being reported in the third quarter of 2006. --Litigation costs incurred in connection with the Kodak lawsuit totaled $3.5 million ($0.91 per diluted share) in the first three months of 2006, up from $2.6 million ($0.67 per diluted share) in the first three months of 2005. The increase in litigation costs was due to the deposition Deposition Christ is taken from the cross and enshrouded. [N.T.: Matthew 27:57–60; Christian Art: Appleton, 55] See : Passion of Christ of expert witnesses and other activities in preparation for the claims interpretation hearing scheduled for June June: see month. 2006. The trial is currently scheduled for December December: see month. 2006. --The Recorders segment earned operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $0.17 per diluted share in the first quarter of 2006 and in the comparable period in 2005. New products sales increased slightly from 2005 to 2006, but the decline in legacy products caused total Recorders segment revenues to decline to $5.5 million in 2006 from $6.5 million in 2005. Additional new products are scheduled to be available for shipment in the third and fourth quarters of 2006, which make up a portion of our backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. that totaled $9.1 million at March 31, 2006. --The Company is entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: to reimbursement Reimbursement Payment made to someone for out-of-pocket expenses has incurred. of certain business development expenses incurred and a portion of incentive fee income earned by an investment limited partnership, should gains be realized on the sale of securities in a British specialties chemical company. In the first quarter of 2006, approximately two-thirds of the partnership's holdings were sold. The Company received reimbursement of business development costs previously incurred and incentive fee income totaling $2.3 million resulting from this sale. Additional incentive fees are due when the balance of the securities are sold. As a result of the foregoing, operating income (loss) for the Company's business segments and unallocated corporate expenses were as follows:
For the three months ended March 31,
2006 2005
(in millions)
Licensing segment $(1.5) $8.4
Recorders segment 0.6 0.7
Unallocated corporate (1.0) (2.1)
Operating income (loss) $(1.9) $ 7.0
As previously announced, the Company will host a conference call on Tuesday Tuesday: see week. , May 9, 2006 at 4:30 p.m. eastern time to discuss its first quarter 2006 financial results. To access the call, please call Genesys Conferencing  This article or section is written like an .Please help [ rewrite this article] from a neutral point of view. Mark blatant advertising for , using . at (866) 244-4517 by 4:20 p.m. and press *901466* to enter the call. Parties interested in asking questions of management are requested to give the moderator moderator - A person, or small group of people, who manages a moderated mailing list or Usenet newsgroup. Moderators are responsible for determining which email submissions are passed on to the list or newsgroup. their name and telephone contact information. A replay of the conference call will be available on the Ampex website www.ampex.com, Investor Relations Investor relations The process by which the corporation communicates with its investors. , "First Quarter 2006 Earnings Call", for approximately one week shortly after the call has been concluded. Ampex Corporation, www.ampex.com, headquartered in Redwood City, California Redwood City is a suburb located on the San Francisco Peninsula in the San Francisco Bay Area of California. Redwood City is the county seat of San Mateo County. As of the 2005 census, the city had a total population of 76,000. , is one of the world's leading innovators innovators people who will try new things. early innovators important figures in the farming or client community because they are the leaders in the introduction of new techniques and management systems. and licensors of technologies for the visual information age. This news release contains predictions, projections and other statements about the future that are intended to be "forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. " within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of l995 (collectively, "forward-looking statements"). Forward-looking statements relate to various aspects of the Company's operations and strategies, including but not limited to the effects of having experienced significant losses in the past and the risk that the Company may incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. losses in the future; the Company's limited liquidity and significant indebtedness INDEBTEDNESS. The state, of being in debt, without regard to the ability or inability of the party to pay the same. See 1 Story, Eq. 343; 2 Hill. Ab. 421. 2. and interest expense; its sales and royalty revenues declining in future periods, and the risk that the Company will not conclude additional royalty-bearing license agreements covering its digital technologies; the Company's marketing, product development, acquisition, investment, licensing and other strategies not being successful; possible future issuances of debt or equity securities; the possible incurrence In`cur´rence n. 1. The act of incurring, bringing on, or subjecting one's self to (something troublesome or burdensome); as, the incurrence of guilt, debt, responsibility, etc. s> Noun 1. of significant patent litigation expenses or adverse legal determinations finding the Company's patents not be valid or not to have been infringed; new business development and industry trends; the possible need to raise additional capital in order to meet the Company's obligations; reliance on a former affiliate to make contributions to the Company's pension plans which are substantially underfunded un·der·fund tr.v. un·der·fund·ed, un·der·fund·ing, un·der·funds To provide insufficient funding for. underfunded adj → infradotado (económicamente) and most other statements that are not historical in nature. Important factors that could cause actual results to differ materially from those described in the forward-looking statements are described in cautionary statements included in this news release and/or in the Company's 2005 Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. filed with the SEC and its Quarterly Report on Form 10-Q Form 10-Q See 10-Q. for 2006 expected to be filed shortly. In assessing forward-looking statements, readers are urged to consider carefully these cautionary statements. Forward-looking statements speak only as of the date of this news release, and the Company disclaims any obligations to update such statements.
AMPEX CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(in thousands, except share and per share data)
(unaudited)
For the Three Months Ended
March 31,
-----------------------------------
2006 2005
----------------- -----------------
Licensing revenue $ 2,590 $11,411
Product revenue 3,422 4,246
Service revenue 2,097 2,274
----------------- -----------------
Total revenue 8,109 17,931
----------------- -----------------
Intellectual property costs 4,073 3,028
Cost of product revenue 1,822 2,536
Cost of service revenue 596 689
Research, development and
engineering 1,092 1,032
Selling and administrative 2,423 3,668
----------------- -----------------
Total costs and operating
expenses 10,006 10,953
----------------- -----------------
Operating income (loss) (1,897) 6,978
Media pension costs 185 193
Interest expense 625 741
Amortization of debt financing
costs 1 14
Interest income (99) (69)
Other (income) expense, net (772) (46)
----------------- -----------------
Income (loss) before income
taxes (1,837) 6,145
Provision for income taxes 23 221
----------------- -----------------
Net income (loss) (1,860) 5,924
Other comprehensive income
(loss), net of tax:
Foreign currency translation
adjustments 2 53
----------------- -----------------
Comprehensive income (loss) $(1,858) $ 5,977
================= =================
Basic income (loss) per share $ (0.49) $ 1.60
================= =================
Weighted average number of basic
common shares outstanding 3,806,519 3,698,197
================= =================
Diluted income (loss) per share $ (0.49) $ 1.52
================= =================
Weighted average number of
diluted common shares
outstanding 3,806,519 3,901,223
================= =================
AMPEX CORPORATION
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
(unaudited)
March 31, December 31,
2006 2005
-------------- --------------
ASSETS
Current assets:
Cash and cash equivalents $ 8,346 $ 13,070
Accounts receivable (net of
allowances of $101 in 2006 and $78
in 2005) 4,077 3,091
Inventories 6,262 5,862
Royalties receivable 966 735
Cash collateral on letter of
credit 1,485 1,483
Other current assets 3,285 873
-------------- --------------
Total current assets 24,421 25,114
Property, plant and equipment 1,115 1,215
Other assets 376 373
-------------- --------------
Total assets $ 25,912 $ 26,702
============== ==============
LIABILITIES, REDEEMABLE PREFERRED STOCK AND
STOCKHOLDERS' DEFICIT
Current liabilities:
Notes payable $ 106 $ 113
Accounts payable 5,015 3,802
Net liabilities of discontinued
operations 1,430 1,413
Accrued restructuring costs 606 610
Pension and other retirement
plans 864 864
Other accrued liabilities 6,863 7,935
-------------- --------------
Total current liabilities 14,884 14,737
Long-term debt 26,138 25,725
Pension and other retirement
plans 95,565 95,948
Other liabilities 1,885 1,929
Accrued restructuring costs 880 1,030
Net liabilities of discontinued
operations 1,592 1,679
-------------- --------------
Total liabilities 140,944 141,048
-------------- --------------
Commitments and contingencies
Mandatorily redeemable nonconvertible
preferred stock, $1,000 liquidation
value per share:
Authorized: 69,970 shares in
2006 and in 2005
Issued and outstanding - none in
2006 and in 2005 - -
Mandatorily redeemable preferred
stock, $2,000 liquidation value per
share:
Authorized: 21,859 shares in
2006 and in 2005
Issued and outstanding - none in
2006 and in 2005 - -
Convertible preferred stock,
$2,000 liquidation value per
share:
Authorized: 10,000 shares in
2006 and in 2005
Issued and outstanding - none in
2006 and in 2005 - -
Stockholders' deficit:
Preferred stock, $1.00 par
value:
Authorized: 898,171 shares
in 2006 and in 2005
Issued and outstanding -
none in 2006 and in 2005 - -
Common stock, $.01 par value:
Class A:
Authorized: 175,000,000
shares in 2006 and in 2005
Issued and outstanding -
3,820,273 shares in 2006;
3,789,773 in 2005 38 38
Class C:
Authorized: 50,000,000
shares in 2006 and in 2005
Issued and outstanding -
none in 2006 and in 2005 - -
Other additional capital 454,983 454,789
Accumulated deficit (458,813) (456,953)
Accumulated other comprehensive
loss (111,240) (112,220)
-------------- --------------
Total stockholders' deficit (115,032) (114,346)
-------------- --------------
Total liabilities, redeemable
preferred stock and
stockholders' deficit $ 25,912 $ 26,702
============== ==============
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