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Rimage Reports Second Quarter 2012 Financial Results

Rimage Corporation (NASDAQ: RIMG) today reported its financial results for the second quarter ended June 30, 2012.
  • Second quarter 2012 revenues totaled $18.3 million, a decrease of 9% from $20.2 million in revenues in the second quarter of 2011. The decrease reflected lower revenues from disc publishing, partially offset by revenues from Qumu, acquired on October 10, 2011.
  • Qumu revenues totaled $1.4 million in the second quarter. Qumu ended the quarter with a $6.6 million backlog of contracted commitments, compared with $1.5 million at the end of the first quarter. Included in the quarter-end backlog of contracted commitments is a multi-year, multi-million dollar transaction supporting a Fortune 50 company.
  • Disc publishing revenues in the recent second quarter were $16.9 million, down 16% compared with revenues in the second quarter of 2011. The decline was primarily attributable to a 28% decrease in hardware revenues, the result of continued economic softness in Europe and the delay of several transactions in North America. Recurring revenues were down 9.3% from the second quarter of last year. The decrease reflects the comparison of consumables sales against a strong second quarter a year ago, which included stocking by customers concerned with supply disruptions due to the Japan tsunami.
  • Gross margin for the recent second quarter was 45% compared with 49% in the same quarter last year. The decline was mainly due to lower disc publishing hardware revenues as a percentage of total sales and underabsorption of fixed costs from lower volumes. Operating expenses in the quarter increased to $12.0 million from $8.1 million in the comparable quarter last year, reflecting the addition of $4.1 million of operating expenses associated with Qumu.
  • The net loss for the second quarter of 2012 was $2.8 million, or $(0.27) per diluted share. This compares with net income of $1.2 million in the second quarter of 2011, or $0.12 per diluted share. Excluding the amortization of intangibles associated with Qumu, the net loss per share was $(0.24) in the recent second quarter.
  • Cash and marketable securities totaled $62 million at June 30, 2012 compared with $67 million at March 31, 2012. During the second quarter, the Company paid out $1.7 million in dividends and used $0.9 million to repurchase stock. Second quarter 2012 cash used in operations was $0.7 million.

Sherman L. Black, president and CEO, said, “Disc publishing revenues in the second quarter were disappointing and reflected weaker than anticipated demand in Europe and funding challenges with several financial services and government customers that resulted in the delay of several transactions. In the third quarter, we expect to close on several transactions in the pipeline and disc publishing revenues to increase from the second quarter level.”

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