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Imation Announces Third Quarter Results And Acceleration Of Its Strategic Transformation

Stocks in this article: IMN

Imation Corp. (NYSE: IMN) a global scalable storage and data security company, today made several announcements: third quarter financial results; the realignment of its global business into two new business units; a cost reduction program; and increased focus on data storage and security including exploring strategic options for its consumer electronic brands and businesses.

Q3 Overview

The Company reported Q3 2012 net revenue of $248.2 million, down 19.6 percent from Q3 2011, an operating loss of $6.5 million including a benefit in restructuring and other charges of $3.6 million, and a diluted loss per share of $0.17. Excluding the net benefit in restructuring and other charges, Q3 2012 operating loss would have been $10.1 million and diluted loss per share would have been $0.26 (see Tables Five and Six for Non-GAAP measures).

Imation President and Chief Executive Officer Mark Lucas commented: “Our revenues came in below our expectations in most product lines and in all regions. While weak macro-economic conditions were a factor, we are certainly not satisfied with this performance. Given our soft results it is now not likely that we will return to total company revenue growth in the near term.”

Strategic Initiatives

Lucas commented, “Our traditional media businesses are declining faster than we anticipated driving the need to accelerate our transformation through the following actions. First, we are reorganizing into two channel-focused business units; second, we are implementing an aggressive cost reduction program; and finally we will explore strategic options for our consumer electronic brands and businesses. These actions will further focus the Company on Secure and Scalable Storage with large, growing markets and higher margins. The third quarter all-time high margins achieved in Secure and Scalable Storage provides concrete evidence of the potential of this market. Based on Imation’s strong competency in data storage, we are confident in our strategy to transform the Company into a data storage and data security company.”

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