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Emerson Radio Corp.: Emerson Radio Corp. Reports Fiscal 2010 First Quarter Results

^{Published on 2009-08-22 14:23:08, Last Modified on 2009-08-22 14:23:10 - Market Wire}
 

PARSIPPANY, NJ--(Marketwire - August 19, 2009) - Emerson Radio Corp. (NYSE Amex: [ MSN ]) today reported financial results for its first quarter ended June 30, 2009.

Net revenues for the first quarter of fiscal 2010 were $55.6 million, an increase of $11.8 million, or 26.8%, compared to net revenues in the first quarter of fiscal 2009 of $43.8 million. The increase in net revenues during the first quarter of fiscal 2010 was due to higher sales in the home appliances category, partially offset by lower sales in the Company's audio and themed categories, and lower revenue earned from licensing activities.

Operating income for the first quarter of fiscal 2010 was $1.4 million compared to $0.4 million for the first quarter of fiscal 2009, an increase of $1.0 million. The increase in operating income was due primarily to the higher revenue coupled with lower SG&A expenses, which were down $0.7 million, or 16.3%, from last year's first fiscal quarter, resulting primarily from lower legal, advertising, and travel related costs.

Net income from continuing operations for the first quarter of fiscal 2010 was $1.2 million or $0.04 per diluted share compared to a first quarter fiscal 2009 net loss from continuing operations of $0.2 million or $0.01.

After considering the impact of discontinued operations, which resulted from the April 2009 sale by the Company of its membership interest in the ASI joint venture, net income for the first quarter of fiscal 2009 was $1.1 million, or $0.04 per diluted share, compared to a net loss of $0.3 million, or $0.01 per diluted share, for the first quarter of fiscal 2009.

"The Company returned to profitability in the quarter on strong sales of its home appliance products and lower operating expenses resulting from its expense reduction programs," said Greenfield Pitts, Executive Vice President and Chief Financial Officer of Emerson Radio. "In addition, the Company will continue to explore opportunities to leverage its portfolio of well known consumer brands, including the recently acquired Olevia brand, through strategic licensing agreements in a variety of consumer product categories."

About Emerson Radio Corp.

Emerson Radio Corporation (NYSE Amex: [ MSN ]), founded in 1948, is headquartered in Parsippany, N.J. The Company designs, sources, imports and markets a variety of home appliance and consumer electronic products, and licenses its trademarks to others on a worldwide basis for a variety of products. For more information, please visit Emerson Radio's Web site at [ www.emersonradio.com ].

Forward-Looking Statements

This release contains "forward-looking statements" made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements reflect management's current knowledge, assumptions, judgment and expectations regarding future performance or events. Although management believes that the expectations reflected in such statements are reasonable, they give no assurance that such expectations will prove to be correct and you should be aware that actual results could differ materially from those contained in the forward-looking statements. Forward-looking statements are subject to a number of risks and uncertainties, including the risk factors detailed in the Company's reports as filed with the Securities and Exchange Commission. The Company assumes no obligation to update the information contained in this news release.

 EMERSON RADIO CORP. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except earnings per share data) Three months ended June 30, 2008 2009 * RESTATED * -------------- ------------- Net revenues $ 55,599 $ 43,827 Net revenues-related party - 13 -------------- ------------- 55,599 43,840 -------------- ------------- Cost of sales 49,603 37,797 Other operating costs and expenses 778 1,125 Selling, general & administrative expenses 3,789 4,529 -------------- ------------- 54,170 43,451 -------------- ------------- -------------- ------------- Operating income 1,429 389 Interest income, net 10 142 Realized/unrealized holding gains on trading securities - 262 -------------- ------------- Income from continuing operations before income taxes 1,439 793 Provision for income taxes 278 1,005 -------------- ------------- Income (loss) from continuing operations 1,161 (212) Loss from discontinued operations, net of tax benefit 55 56 -------------- ------------- Net income (loss) $ 1,106 $ (268) ============== ============= Basic net income (loss) per share Continuing operations $ 0.04 $ (0.01) Discontinued operations - - -------------- ------------- $ 0.04 $ (0.01) ============== ============= Diluted net income (loss) per share Continuing operations $ 0.04 $ (0.01) Discontinued operations - - -------------- ------------- $ 0.04 $ (0.01) ============== ============= Weighted average shares outstanding: Basic 27,130 27,130 Diluted 27,130 27,130 * The results of operations for three months ended June 30, 2008 have been restated as set forth in the Company's amended quarterly report on Form 10-Q/A for the same period on file with the Securities and Exchange Commission. Additionally, as a result of the Company's sale of its membership in the ASI joint venture in April 2009, the results of operations of the Company's membership interest in the ASI joint venture have been presented as discontinued operations for all periods presented. EMERSON RADIO CORP. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands) June 30, 2009 March 31, 2009 -------------- -------------- ASSETS Cash and cash equivalents $ 23,619 $ 22,518 Restricted cash 3,067 3,025 Net Accounts receivable 26,668 15,970 Other receivables 1,382 1,587 Due from affiliates 76 78 Net Inventory 17,913 20,691 Prepaid expenses and other current assets 1,288 2,190 Deferred tax assets 5,264 4,872 -------------- -------------- CURRENT ASSETS 79,277 70,931 Property, plant, and equipment, net 1,212 1,139 Trademarks and other intangible assets, net 1,686 255 Due from Affiliates 185 114 Investments in marketable securities 6,031 6,031 Deferred tax assets 6,441 7,102 Other assets 435 472 -------------- -------------- TOTAL ASSETS 95,267 86,044 -------------- -------------- Short-term borrowings 5,752 5,733 Current maturities of long-term borrowings 79 85 Accts payable & other current liabilities 26,945 18,929 Due to affiliates 20 66 Accrued Sales Returns 1,217 1,130 Income taxes payable 143 155 -------------- -------------- CURRENT LIABILITIES 34,156 26,098 Long-term borrowings 48 59 Deferred tax liabilities 95 87 Shareholders' equity 60,968 59,800 -------------- -------------- TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $ 95,267 $ 86,044 -------------- --------------