SOURCE: Emerson Radio Corp.

November 11, 2009 09:20 ET

Emerson Radio Corp. Reports Fiscal 2010 Second Quarter Results

PARSIPPANY, NJ--(Marketwire - November 11, 2009) - Emerson Radio Corp. (NYSE Amex: MSN) today reported financial results for its second quarter and six months ended September 30, 2009.

While net revenues for the second quarter of fiscal 2010 decreased $1.7 million, or 3.3%, to $51.8 million as compared to net revenues in the second quarter of fiscal 2009 of $53.5 million, net revenues for the fiscal year 2010 to date were $107.4 million, an increase of $10.0 million, or 10.3%, compared to net revenues of $97.4 million in the same period of fiscal 2009. The increase in net revenues for year to date 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 second quarter of fiscal 2010 was $3.4 million compared to $0.2 million for the second quarter of fiscal 2009, an increase of $3.2 million. Operating income for the fiscal year 2010 to date was $4.8 million, an increase of $4.2 million over operating income of $0.6 million for the same period of fiscal 2009. The increase in fiscal year to date operating income is driven by the Company's efforts to manage costs while growing net revenue, as reflected in a nearly 20% reduction in year-over-year SG&A expenses, coupled with a 10.3% increase in year-over-year net revenue.

Net income from continuing operations for the second quarter of fiscal 2010 was $3.2 million or $0.12 per diluted share compared to $0.2 million for the second quarter of fiscal 2009 or $0.01 per diluted share. Net income from continuing operations for fiscal year 2010 to date was $4.4 million or $0.16 per diluted share compared to a net loss from continuing operations of $61,000 for the same period in fiscal 2009.

After considering the impact of discontinued operations, net income for the second quarter of fiscal 2010 was $3.2 million, or $0.12 per diluted share, compared to net income of $26,000 for the second quarter of fiscal 2009. After considering the impact of discontinued operations, net income for fiscal year 2010 to date was $4.3 million, or $0.16 per diluted share, compared to a net loss of $0.2 million or $0.01 per diluted share for the same period in fiscal 2009.

"Through the second quarter the Company continued to focus on reducing its cost structure while growing sales of its home appliance products resulting in operating income of $4.8 million for fiscal year 2010 to date," said Greenfield Pitts, Executive Vice President and Chief Financial Officer of Emerson Radio. "While the Company is pleased with its results to date this fiscal year, it continues to focus on building sales of its home appliance products and exploring opportunities to leverage its portfolio of well known consumer brands through strategic licensing agreements without losing the discipline that has been built around its cost management efforts."

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 Statement of Operations
                                (Unaudited)
                  (in thousands, except per share data)


                                 Three months ended     Six months ended
                                    September 30,         September 30,
                                             2008
                                  2009     RESTATED *   2009 *     2008 *
                                ---------- ---------  ---------  ---------

Net revenues:
Net revenues                    $   51,774 $  53,529  $ 107,373  $  97,356
Net revenues-related party               -         2          -         15
                                ---------- ---------  ---------  ---------
                                    51,774    53,531    107,373     97,371
                                ---------- ---------  ---------  ---------

Costs and expenses:
Cost of sales                       43,701    47,024     93,304     84,822
Other operating costs and
 expenses                            1,077     1,586      1,855      2,711
Selling, general &
 administrative expenses             3,643     4,733      7,432      9,262
                                ---------- ---------  ---------  ---------
                                    48,421    53,343    102,591     96,795
                                ---------- ---------  ---------  ---------

                                ---------- ---------  ---------  ---------
Operating income                     3,353       188      4,782        576

Interest income, net                    12        63         22        206
Unrealized holding (losses) on
 trading securities                      -       (52)         -        (21)
Realized gains on trading
 securities                              -       301          -        532
                                ---------- ---------  ---------  ---------
Income from continuing
 operations before income taxes      3,365       500      4,804      1,293

Provision for income taxes             144       349        422      1,354

                                ---------- ---------  ---------  ---------
Income (loss) from continuing
 operations                          3,221       151      4,382        (61)

Loss from discontinued
 operations, net of tax benefit          -      (125)       (55)      (181)

                                ---------- ---------  ---------  ---------
Net income (loss)               $    3,221 $      26  $   4,327  $    (242)
                                ========== =========  =========  =========

Basic net income (loss) per
 share
   Continuing operations        $     0.12 $    0.01  $    0.16  $       -
   Discontinued operations               -     (0.01)         -      (0.01)
                                ---------- ---------  ---------  ---------
                                $     0.12 $       -  $    0.16  $   (0.01)
                                ========== =========  =========  =========

Diluted net income (loss) per
 share
   Continuing operations        $     0.12 $    0.01  $    0.16  $       -
   Discontinued operations               -     (0.01)         -      (0.01)
                                ---------- ---------  ---------  ---------
                                $     0.12 $       -  $    0.16  $   (0.01)
                                ========== =========  =========  =========

Weighted average shares
 outstanding:
Basic and Diluted                   27,130    27,130     27,130     27,130


* The results of operations for three months ended September 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 Sheet
                              (in thousands)


                                               September 30,    March 31,
                                                   2009           2009
                                               -------------  -------------
ASSETS
Current assets:
   Cash and cash equivalents                   $      28,997  $      22,518
   Restricted cash                                         2          3,025
   Accounts receivable, net                           18,733         15,970
   Other receivables                                   1,447          1,587
   Due from affiliates                                    11             78
   Inventory, net                                     22,255         20,691
   Prepaid expenses and other current assets           1,480          2,190
   Deferred tax assets                                 4,648          4,872
                                               -------------  -------------
      Total current assets                            77,573         70,931
Property, plant, and equipment, net                    1,074          1,139
Trademarks and other intangible assets, net            1,667            255
Due from affiliates                                      185            114
Investments in marketable securities                   6,031          6,031
Deferred tax assets                                    7,200          7,102
Other assets                                             312            472
                                               -------------  -------------
      Total assets                                    94,042         86,044
                                               =============  =============

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
   Short term borrowings                               5,668          5,733
   Current maturities of long-term borrowings             68             85
   Accts payable and other current liabilities        22,541         18,929
   Due to affiliates                                      41             66
   Accrued sales returns                               1,236          1,130
   Income taxes payable                                  148            155
                                               -------------  -------------
      Total current liabilities                       29,702         26,098
Long-term borrowings                                      43             59
Deferred tax liabilities                                 103             87
Shareholders equity                                   64,194         59,800
                                               -------------  -------------
      Total liabilities and shareholders'
       equity                                  $      94,042  $      86,044
                                               =============  =============

Contact Information

  • CONTACT:

    Emerson Radio Corp.
    Greenfield Pitts
    Chief Financial Officer
    (212) 897-5441

    Investor Relations:
    Robert Maffei
    Investor Relations Manager
    (973) 428-2098