Imation Corp. (NYSE: IMN) today released financial results for the quarter and nine months ended September 30, 2013. The Company also announced that, consistent with its strategic transformation, it has divested its Memorex
consumer electronics business, as well as signed a letter of intent to sell its XtremeMac
For the third quarter, Imation reported net revenue of $191.9 million, down 15.6 percent from Q3 2012, an operating loss from continuing operations of $26.5 million, including special charges of $11.7 million, which are primarily related to a non-cash loss associated with the settlement of a UK pension plan, and diluted loss per share from continuing operations of $0.65. Excluding special charges, Q3 2013 operating loss would have been $14.8 million, and diluted loss per share from continuing operations would have been $0.42 (See Tables Five and Six for non-GAAP measures).
Imation’s CEO Mark Lucas commented, “Our top line revenues continue to be impacted by secular declines in optical as well as tape media where we saw decreases that were higher than we had anticipated. We had revenue gains from our Nexsan
acquisition and growth in mobile security; however, these were not yet large enough to offset our storage media declines. As we invest for growth in our storage solutions and information security businesses, we also remain focused on generating cash from our legacy businesses. We generated $14.5 million in cash from operations during Q3 and ended the quarter with a cash position of $108.4 million.”
Sale of Non-core Businesses
On October 15, 2013, Imation completed the sale of the Memorex consumer electronics business. Following that, on October 17, 2013, the Company signed a letter of intent to sell the XtremeMac consumer electronics business; this transaction is anticipated to close by December 31. Total proceeds to be received from discontinuing these businesses are estimated at approximately $19 million, with approximately $10 million spread between the fourth quarter of 2013 and early 2014, and the balance over the next several years.