2011 Fourth Quarter and Full-Year Results; Appointment of Chief Operating OfficerCEO Scott Drill commented, “The poor results we saw in 2011 continued through the fourth quarter. Although we are seeing signs of our business gaining some strength, our overall sign count and revenue level are much lower than planned. Given these results, the Company enacted a restructuring plan last Friday that will save the Company approximately $3.1 million annually. The key components of the restructuring are as follows:
- We reduced our workforce by 34, which was approximately 29% of our employee base. This will produce a restructuring charge of approximately $450,000, which we will record in the first quarter of 2012.
- Lowered annual base compensation of our sales force and certain members of management, including Mr. Drill who accepted a 50% reduction in base salary.
- Cut spending on certain discretionary programs.
"Our relationship with Valassis continues to be important, and we are working together to explore additional ways to use our joint sales efforts at CPGs and retailers. We are also moving forward with development of “digital” marketing products, and will be market-testing a sign product featuring a mobile-enacted discount for consumers at one of our leading retailers next month. Our new laser die-cutter is operational, and we will be introducing an enhanced line of Insignia POPSigns and other in-store media products next month based on the laser die-cutter’s capabilities.Selected Financial Information "Fourth quarter 2011 legal expense was $135,000 versus $704,000 in the fourth quarter of 2010. Legal expense for the 2011 year was $1,588,000 versus $2,081,000 in 2010. Our balance sheet remains strong, with approximately $23,202,000 of cash and cash equivalents at December 31, 2011, up from $13,196,000 on December 31, 2010. Finally, we have approximately $8.3 million of POPS orders on the books for 2012, $3.5 million of which is scheduled to run in the first quarter of 2012. At this point in 2011, we had $8.7 million of POPS orders on the books for 2011, $4.3 million of which was scheduled to run in the first quarter 2011.” Conference Call The Company will host a conference call today, March 5, at 4:00 p.m. Central Time. To access the live call, dial 877-268-1608. The Conference ID is 42216078. Please be sure to call in about 5-10 minutes before the call is scheduled to begin. Audio replay will be available approximately two hours after the call until March 13, 2012. To access the replay, dial 855-859-2056 and reference Conference ID 42216078. Insignia Systems, Inc. is an innovative developer and marketer of in-store advertising products, programs and services to retailers and consumer goods manufacturers. Through its Point-Of-Purchase Services (POPS) business, Insignia is provides at-shelf advertising products in over 13,000 chain retail supermarkets, over 1,800 mass merchants and over 6,000 dollar stores. Through the nationwide POPS network, over 200 major consumer goods manufacturers, including General Mills, Kellogg Company, Kraft, Nestlé, Ocean Spray, Reckitt Benckiser, Schwan’s Bakery and Tyson Foods, have taken their brand messages to the point-of-purchase. For additional information, contact (888) 474-7677, or visit the Insignia website at www.insigniasystems.com. Cautionary Statement for the Purpose of Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995 This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Statements made in this press release (or during the conference call referred to herein) by the Company, its President and CEO Scott Drill, its Vice President of Finance and CFO John Gonsior or its Executive Vice President and COO Glen Dall, regarding, for instance: Current expectations as to future financial performance and the Company's ability to increase revenue, implement its restructuring plan and realize the expected savings, continue to control costs and return to profitability; to succeed in the Company’s business relationships with News America and Valassis; to return value to its shareholders; and to develop and implement “digital” marketing products, are forward-looking statements. These forward-looking statements are based on current information, which we have assessed and which by its nature is dynamic and subject to rapid and even abrupt changes. As such, results may differ materially in response to a change in this information. Forward-looking statements include statements expressing the intent, belief or current expectations of the Company and members of our management team and involve certain risks and uncertainties, including: (i) the risk that management may not fully or successfully implement its business plan or maintain profitability in the future; (ii) the risk that the Company will not be able to develop and implement new product offerings, if any, in a successful manner; (iii) prevailing market conditions in the in-store advertising industry, including intense competition for agreements with retailers and consumer packaged goods manufacturers; (iv) potentially incorrect assumptions by management with respect to the financial effect of cost reduction initiatives and current strategic decisions; and (v) other economic, business, market, financial, competitive and/or regulatory factors affecting the Company’s business generally , including those set forth in the Company’s filings with the SEC. You are cautioned not to place undue reliance on these or any forward-looking statements, which speak only as of the date of this press release and conference call. Such forward-looking statements should be read in conjunction with the Company's filings with the SEC. The Company assumes no responsibility to update the forward-looking statements contained in this release.
|Insignia Systems, Inc.|
|STATEMENTS OF OPERATIONS|
|Three Months Ended||Year Ended|
|December 31,||December 31,|
|Cost of sales||3,526,000||3,860,000||12,415,000||14,836,000|
|General & administrative||990,000||1,549,000||5,495,000||5,549,000|
|Gain from litigation settlement, net||-||-||(89,762,000||)||-|
|Operating income (loss)||(2,201,000||)||(231,000||)||81,632,000||905,000|
|Other income, net||8,000||1,000||63,000||17,000|
|Income (loss) before taxes||(2,193,000||)||(230,000||)||81,695,000||922,000|
|Income tax benefit (expense)||1,805,000||5,674,000||(30,606,000||)||5,674,000|
|Net income (loss)||$||(388,000||)||$||5,444,000||$||51,089,000||$||6,596,000|
|Net income (loss) per share|
|Shares used in calculation of|
|net income (loss) per share:|
|SELECTED BALANCE SHEET DATA|
|December 31,||December 31,|
|Cash and cash equivalents||$||23,202,000||$||13,196,000|