CORNERSTONE IMAGING REPORTS 1996 FIRST QUARTER RESULTS.SAN JOSE San Jose, city, United States San Jose (sănəzā`, săn hōzā`), city (1990 pop. 782,248), seat of Santa Clara co., W central Calif.; founded 1777, inc. 1850. , Calif.--(BUSINESS WIRE)--April 17, 1996--Cornerstone Imaging, Inc., a provider of hardware and software system building blocks for applications using document images, today released operating results for the quarter ending March 31, 1996. -0-
Summary financial results:
(dollars and shares in millions)
Q1:96(a) Q4:95 Q1:95
Revenues $ 17.8 $ 28.8 $ 17.7 Gross margin 30.2 % 36.0 % 38.8 % Operating margin (20.4) % 10.7 % 10.1 % Operating income (loss) (3.6) 3.1 1.8 Net income (loss) $ (2.5) $ 2.3 $ 1.3 EPS $ (0.33) $ 0.30 $ 0.17 Cash and marketable securities $ 8.2 $ 10.4 $ 16.6 Weighted average shares 7.4 7.7 7.4 (a) includes $1.4M restructuring charge Reported revenues were $17.8 million, a decrease of 38% from Q4 1995 and an increase of 1% from Q1 1995. The reduced revenues contributed to a net loss for the quarter of $2.5 million, or 33 cents per share Cents per share The amount of a mutual fund's dividend or capital gains distributions that a shareholder will receive for each share owned. . The loss included a restructuring charge restructuring charge The expense of reorganizing a company's operations. A restructuring charge is an infrequent expense that generally results from asset writedowns or facility closings. of $1.4 million, primarily related to the Company's decision to discontinue dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: its print accelerator accelerator: see particle accelerator. (1) A key combination such as Alt-G or Ctrl-Shift H that is used to activate a task. (2) An incubator that expects to develop the company considerably faster than normal. See incubator. product line. Said Thomas (language) Thomas - A language compatible with the language Dylan(TM). Thomas is NOT Dylan(TM). The first public release of a translator to Scheme by Matt Birkholz, Jim Miller, and Ron Weiss, written at Digital Equipment Corporation's Cambridge Research Laboratory runs T. van Overbeek, President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , "The first quarter was very disappointing, particularly after our record fourth quarter. We believe the reasons for the revenue shortfall Shortfall The amount by which the capital required to fulfill a financial obligation exceeds available capital. Notes: Shortfall risk is often combated with an efficient hedging strategy created by a fund, group, institution, or individual. are pricing, seasonality, and technology transition issues in the DIP market. We think a number of customers delayed purchasing decisions in Q1 due to issues related to technology transition in the DIP market. Fundamentally, imaging is moving into the mainstream. "Larger organizations want to deploy imaging across the enterprise via groupware Software that supports multiple users working on related tasks in local and remote networks. Also called "collaborative software," groupware is an evolving concept that is more than just multiuser software which allows access to the same data. and Intranet technologies. Enterprise-wide imaging is driving the market toward more open component based systems. Although this should be good news for Cornerstone cornerstone Ceremonial building block, dated or otherwise inscribed, usually placed in an outer wall of a building to commemorate its dedication. Often the stone is hollowed out to contain newspapers, photographs, or other documents reflecting current customs, with a view to in the longer term, in the short term we believe it has caused uncertainty and delays in purchasing decisions. The recently concluded AIIM (Association for Information and Image Management International, Silver Spring, MD, www.aiim.org) A membership organization founded in 1943 devoted to creating industry standards and disseminating information about the document management industry. imaging trade show should help customers resolve their concerns." Gross margin for Q1 was 30.2% compared to 36.0% in Q4 1995 and 38.8% in Q1 1995. The lower margin is primarily attributable to price reductions for display products. "We've fundamentally changed our display pricing strategy with recent price reductions. As imaging becomes an enterprise-wide capability, Cornerstone must be more competitive with providers of general purpose display products even though we continue to enjoy clear product advantages for imaging applications," said van Overbeek. Total expenses for Q1 1996 were $7.6 million, up from $7.3 in Q4 1995, and $5.1 million in Q1 1995. The increase from Q4 to Q1 is primarily attributable to the purchase of software technology which is included in R&D spending. "We discontinued dis·con·tin·ue v. dis·con·tin·ued, dis·con·tin·u·ing, dis·con·tin·ues v.tr. 1. To stop doing or providing (something); end or abandon: PrintAccel, our print accelerator board An add-in board that replaces the existing CPU with a higher performance CPU. See graphics accelerator. , and we are focusing our resources and spending on our core product areas of display, document capture, and software tools," said van Overbeek. The net loss for Q1 1996 was $2.5 million or 33 cents per share, compared to a profit of $2.3 million, or 30 cents per share in Q4 1995, and a profit of $1.3 million, or 17 cents per share in Q1 1995. Cash and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has ended the quarter at $8.2 million, compared to $10.4 million at December 31, 1995. Inventory increased to $18 million from $14.1 at December 31, 1995. "We built inventory in anticipation of higher revenues," said van Overbeek. "We expect inventory to come back into line as we go forward." Lower first quarter revenues also contributed to a reduction in accounts receivable accounts receivable n. the amounts of money due or owed to a business or professional by customers or clients. Generally, accounts receivable refers to the total amount due and is considered in calculating the value of a business or the business' problems in paying from $17.9 million at December 31, 1995, to $11.8 million. About Cornerstone Cornerstone Imaging, Inc., headquartered in San Jose, CA, is the technology and market leader in image display products for DIP. The Company's products and services are building blocks that optimize optimize - optimisation system and user productivity in DIP applications. Cornerstone's subsystems and software products are based on proprietary silicon and software to improve the capture, storage, and display of digitally- stored images, processes critical to DIP user efficiency. Cornerstone Imaging, Inc. is a publicly-held company traded on The Nasdaq National Market under symbol CRNR CRNR Center for Really Neat Research (Syracuse University) . This Press Release contains 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. that involve risk and uncertainties. The Company's actual results may differ materially from the results discussed in the forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in "Risk Factors" in the Company's 1995 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. . -0-
FINANCIAL TABLES FOLLOW
For more information on Cornerstone Imaging, Inc. via fax, dial
1-800-PRO-INFO, code 045. No cost.
CORNERSTONE IMAGING, INC.
STATEMENTS OF INCOME (UNAUDITED)
(in thousands, except per share amounts)
Three Months Ended
Mar 31, 1996 Mar 31, 1995
Revenues $ 17,832 $ 17,723 Cost of revenues 12,454 10,844 Gross profit 5,378 6,879 Research & development 2,641 1,814 Sales, general & administrative 4,967 3,283 Restructuring charge 1,404 Operating income (loss) (3,634) 1,782 Interest income 88 148 (Provision) benefit for income tax 1,065 (666) Net income (loss) $ (2,481) $ 1,264 Net income (loss) per share $ (0.33) $ 0.17 Weighted average shares 7,423 7,398
CORNERSTONE IMAGING INC.
BALANCE SHEETS
(in thousands)
ASSETS
(Unaudited)
Mar 31, 1996 Dec 31, 1995
Current assets: Cash & marketable securities $ 8,160 $ 10,441 Accounts receivable 11,794 17,885 Inventories 18,038 14,075 Deferred income taxes 3,311 3,228 Other current assets 1,763 2,159
Total current assets 43,066 47,788
Property & equipment 3,232 3,356 Deferred taxes and other assets 1,405 1,412
Total $ 47,703 $ 52,556
LIABILITIES & STOCKHOLDERS' EQUITY
Current liabilities: Accounts payable $ 7,158 $ 8,825 Accrued liabilities 3,629 4,400
Total current liabilities 10,787 13,225
Stockholders' equity: Common stock & paid-in capital 30,223 30,140 Retained earnings 6,693 9,191 Stockholders' equity 36,916 39,331
Total $ 47,703 $ 52,556
CONTACT: Cornerstone Imaging Inc. John Finegan, 408/435-8900 or Financial Relations Board, SF Betsy Truax, 415/986-1591 |
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