SOURCE: Emerson Radio Corp.

August 14, 2007 18:35 ET

Emerson Radio Corp. Reports Fiscal 2008 First Quarter Results

PARSIPPANY, NJ--(Marketwire - August 14, 2007) - Emerson Radio Corp. (AMEX: MSN) yesterday reported financial results for its first quarter ended June 30, 2007.

Net revenues for the first quarter of fiscal 2008 were $52.7 million, compared to $55.2 million during the same period last year. Revenue growth in the housewares category was offset in the period by lower sales of the Company's traditional audio products.

The Company's operating income for the first quarter improved to $588,000 compared to $490,000 during the same period last year. The increase was primarily due to a reduction in inventory reserves of $1.4 million related to the termination of the Company's license agreement with Nickelodeon earlier this calendar year. Net income for the first quarter of fiscal 2008 was $442,000 or $0.02 per diluted share, compared to net income of $581,000 or $0.02 per diluted share, in the prior year period. Net income for the fiscal 2008 first quarter reflects adjustments to the Company's deferred tax position and higher state income tax requirements.

"The first quarter of fiscal 2008 reflects a solid performance in this traditionally soft period," commented Eduard Will, Emerson Radio Corp. President - North American Operations. "During the quarter, we continued to bolster our product line as design improvements, enhanced feature sets and the introduction of new products all served to further differentiate our offerings in the marketplace, both in housewares and our audio division. Within the housewares category, we continued to gain market share in microwaves and have increased SKUs at our major retail accounts, and we have begun expanding distribution of our wine cooler offerings beyond our initial outlets. We also began shipment of our Mattel-licensed products in April, which offset revenues from the Nickelodeon license discontinued earlier this year. "

About Emerson Radio Corporation

Emerson Radio Corporation (AMEX: MSN), founded in 1948, is headquartered in Parsippany, N.J. The Company designs, markets and licenses, worldwide, full lines of televisions and other video products, microwaves, clocks, radios, audio and home theater products. Emerson's web site is

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.

              (In thousands, except earnings per share data)

                                                       Three Months June 30
                                                         2007       2006
                                                      ---------- ----------
Net revenues
Net revenues                                          $   52,603 $   55,241
Net revenues-related party                                    85         --
                                                      ---------- ----------
                                                          52,688     55,241
                                                      ---------- ----------

Costs and expenses:
Cost of sales                                             45,248     47,840
Other operating costs and expenses                         1,796      1,599
Selling, general and administrative expenses
 (exclusive of non-cash compensation shown below)          4,977      5,207
Non-cash compensation                                         79        105
                                                      ---------- ----------
                                                          52,100     54,751
                                                      ---------- ----------

Operating income                                             588        490

Interest income, net                                          70        105
Interest income-related party                                163         --
                                                      ---------- ----------
Income before income taxes                                   821        595
   Provision for income taxes                                379         14
                                                      ---------- ----------
Net income                                            $      442 $      581

Net income per share
Basic                                                 $     0.02 $     0.02
Diluted                                               $     0.02 $     0.02

Weighted average shares outstanding
   Basic                                                  27,130     27,065
   Diluted                                                27,156     27,140


                        CONSOLIDATED BALANCE SHEETS
                              (In thousands)

                                                    June 30,    March 31,
                                                      2007       2007(A)
                                                  ------------ ------------

   Cash and cash equivalents (includes cash
    securing bank loans of $3,000)                $     26,165 $      4,851
   Accounts receivable                                  27,785       19,375
   Due from affiliates                                     239       24,690
   Inventory                                            45,102       32,463
   Deferred tax assets                                   4,916        5,737
   Other current assets                                  5,259        4,912
                                                  ------------ ------------
      Total current assets                             109,466       92,028

Property, plant and equipment, net                       2,490        2,492
Other assets                                             5,443        4,888
                                                  ------------ ------------
      Total assets                                $    117,399 $     99,408
                                                  ============ ============

Current liabilities                                     42,380       24,845
Long-term borrowings                                       647          651
Other long term debt                                        34           25
Stockholders’ equity                                    74,338       73,887
                                                  ------------ ------------
      Total liabilities and equity                $    117,399 $     99,408
                                                  ============ ============

(A) Reference is made to the Company’s Annual Report on Form 10-K for the
fiscal year ended March 31, 2007 filed with the Securities and Exchange
Commission in June 2007 and amended in July 2007.

Contact Information

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

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

    Brainerd Communicators
    Brad Edwards
    Jonathan Schaffer
    (212) 986-6667