Dataram Reports 2006 Fourth Quarter and Fiscal Year Financial Results; Board of Directors Declares Regular Quarterly $0.06 Per Share Dividend.PRINCETON Princeton, borough (1990 pop. 12,016) and surrounding township (1990 pop. 13,198), Mercer co., W central N.J.; settled late 1600s, borough inc. 1813, township est. 1838. A leading education center, it is the seat of Princeton Univ. , N.J. -- Dataram Corporation (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : DRAM) today reported its financial results for its fiscal fourth quarter and full year ended April 30, 2006. Revenues for the quarter were $8.8 million, which compares to $15.1 million for the fourth quarter of the prior fiscal year. Revenues for fiscal 2006 were $41.8 million versus $65.7 million for the prior fiscal year. Prior fiscal year fourth quarter and full year revenues included sales of approximately $3.7 million and $21.9 million, respectively, to one customer compared to zero and $3.0 million for the comparable current year periods. Net earnings for the fourth quarter were $83,000 or $0.01 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, compared to $3.9 million or $0.44 per diluted share for the fourth quarter of fiscal 2005, which included (i) an income tax benefit of approximately $2.9 million related to a reversal of the Company's valuation allowance for its net operating loss carryforwards Net operating loss carryforwards Application of losses to offset earnings in future years. and (ii) $460,000 of pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern severance The act of dividing, or the state of being divided. The term severance has unique meanings in different branches of the law. Courts use the term in both civil and criminal litigation in two ways: first, when dividing a lawsuit into two or more parts, and second, when charges related to staff reductions. For fiscal 2006, the Company reported net earnings of $2.8 million or $0.31 per diluted share, which includes a pre-tax pre-tax adj → anterior al impuesto pre-tax adj → avant impôt(s) pre-tax adj → al lordo d'imposta gain of $1.9 million from the sale of the Company's undeveloped land. This compares to prior year net earnings of $6.7 million or $0.74 per diluted share, which included the income tax benefit and severance charges noted above. Gross margins during the fourth quarter and current fiscal year were approximately 28 percent and 30 percent, respectively, which compares to 28 percent and 24 percent for the comparable prior periods. The Company considers 25 percent gross margins with quarterly fluctuations of as much as 3 percent to be normal. Engineering and selling, general and administrative costs administrative costs, n.pl the overhead expenses incurred in the operation of a dental benefits program, excluding costs of dental services provided. were $2.5 million in the current quarter, down from $3.2 million during fourth quarter of the prior fiscal year. Fiscal 2006 engineering and selling, general and administrative costs totaled $10.3 million versus $12.0 million in fiscal 2005. Mark Maddocks, Dataram's vice president of finance and CFO See Chief Financial Officer. , stated, "The Company's 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. increased to $964,000 from $635,000 in the third quarter of fiscal 2006. Our balance sheet remains strong with a current ratio of 8.9 and includes $14 million or $1.65 per share in cash and cash equivalents. As we utilize the remainder of our deferred tax assets, we will continue to make cash payments for income taxes at an approximate rate of 7 percent of pretax earnings in the upcoming fiscal year while we use an effective tax rate for financial reporting purposes of approximately 38 percent. At April 30, 2006, there were 8,487,396 common shares outstanding." Robert V. Tarantino, Dataram's chairman 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. commented, "Our order rate in the fourth quarter was consistent with the prior quarter as evidenced by the increase in our backlog. We recognize that our Company has significant operating leverage Operating Leverage A measurement of the degree to which a firm or project relies on fixed rather than variable costs. Notes: The higher the degree of operating leverage, the greater the potential danger from forecasting risk. and that achieving top line growth is our most important priority. To that end, we have focused our sales and marketing resources back on the underlying principals that built Dataram's compatible memory business. From a resource standpoint The Standpoint is a newspaper published in the British Virgin Islands. It was originally published under the name Pennysaver, largely as a shopping-coupon promotional newspaper, but since emerged as one of the most influential sources of journalism in the , we have expanded our domestic sales team, adding eight professionals. We will utilize the additional capacity to reinforce our value proposition at the end-user level. This level of customer relationship is key to facilitating the role of our value-added resellers A value-added reseller (VAR) is a company that adds some feature(s) to an existing product(s), then resells it (usually to end-users) as an integrated product or complete "turn-key" solution. by creating demand at the source. With this strategy and additional capacity we expect to expand our customer base of large corporate end users and value-added resellers. While we have increased our selling capacity, our overall cost structure will remain materially unchanged." Mr. Tarantino concluded, "Our financial condition is strong and we are highly liquid. Today, the Company's board of directors declared a quarterly dividend of $0.06 cents per common share. The dividend will be payable on June 28, 2006, to shareholders of record as of June 14, 2006." As announced in a press release dated May 24, 2006, Dataram will conduct a conference call today at 4:30 p.m. (EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT ) to present its fourth quarter and full year financial results and to respond to investor questions. Interested shareholders may participate in the call by dialing 877-690-6769 providing the following reservation number: 21293802. It is recommended that participants call 10 minutes before the conference call is scheduled to begin. The conference call can also be accessed over the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the through Vcall at www.vcall.com. A replay of the call will be available approximately one hour after the completion of the conference call through Vcall and for 24 hours Adv. 1. for 24 hours - without stopping; "she worked around the clock" around the clock, round the clock by dialing 800-633-8284 or 402-977-9140 and entering the reservation number listed above. ABOUT DATARAM CORPORATION Dataram is a worldwide leader in the design and manufacture of high capacity, reliable and innovative memory solutions. With over 39 years of experience, Dataram provides customized memory solutions for OEMs and compatible memory for leading brands including HP, Dell, IBM (International Business Machines Corporation, Armonk, NY, www.ibm.com) The world's largest computer company. IBM's product lines include the S/390 mainframes (zSeries), AS/400 midrange business systems (iSeries), RS/6000 workstations and servers (pSeries), Intel-based servers (xSeries) , SGI (SGI, Sunnyvale, CA, www.sgi.com) A manufacturer of workstations and servers, founded in 1982 by Jim Clark. The company was founded as Silicon Graphics, Inc., but changed to its acronym in 1999. , Sun Microsystems Sun Microsystems, Inc. (NASDAQ: JAVA[3]) is an American vendor of computers, computer components, computer software, and information-technology services, founded on 24 February 1982. and Intel. For more information about Dataram, visit www.dataram.com The information provided in this press release may include 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. relating to relating to relate prep → concernant relating to relate prep → bezüglich +gen, mit Bezug auf +acc 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 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 Securities and Exchange Commission, which can be reviewed at http://www.sec.gov.
DATARAM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS
(In thousands, except per share amounts)
(Unaudited)
Fourth Quarter Twelve Months
Ended Ended
April 30, April 30,
----------------- -----------------
2006 2005 2006 2005
Revenues $8,773 $15,140 $41,795 $65,684
Costs and expenses:
Cost of sales 6,306 10,839 29,458 49,816
Engineering and development 289 352 1,136 1,300
Selling, general and
administrative 2,244 2,894 9,194 10,653
-------- -------- -------- --------
8,839 14,085 39,788 61,769
Earnings (loss) from operations (66) 1,055 2,007 3,915
Other income 181 25 2,431 202
-------- -------- -------- --------
Earnings before income taxes 115 1,080 4,438 4,117
Income tax provision (benefit) 32 (2,795) 1,666 (2,598)
-------- -------- -------- --------
Net earnings $83 $3,875 $2,772 $6,715
======== ======== ======== ========
Net earnings per share:
Basic $0.01 $0.46 $0.33 $0.78
======== ======== ======== ========
Diluted $0.01 $0.44 $0.31 $0.74
======== ======== ======== ========
Average number of shares
outstanding:
Basic 8,487 8,500 8,447 8,571
======== ======== ======== ========
Diluted 8,838 8,877 8,821 9,112
======== ======== ======== ========
DATARAM CORPORATION AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
(Unaudited)
April 30, April 30,
2006 2005
ASSETS
Current assets
Cash and cash equivalents $14,044 $9,281
Trade receivables, net 4,893 8,397
Inventories 2,189 2,369
Deferred income taxes 1,365 3,258
Note receivable 1,538 0
Other current assets 80 130
---------- ----------
Total current assets 24,109 23,435
Deferred income taxes 1,176 630
Property and equipment, net 846 2,028
Other assets 105 54
---------- ----------
Total assets $26,236 $26,147
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LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $2,057 $2,528
Accrued liabilities 653 1,438
---------- ----------
Total current liabilities 2,710 3,966
Stockholders' equity 23,526 22,181
---------- ----------
Total liabilities and stockholders' equity $26,236 $26,147
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