SOURCE: Emerson Radio Corp.

Emerson Radio Corp.

August 15, 2011 16:30 ET

Emerson Radio Corp. Reports Fiscal 2012 First Quarter Results

MOONACHIE, NJ--(Marketwire - Aug 15, 2011) - Emerson Radio Corp. (NYSE Amex: MSN) today reported financial results for its first quarter ended June 30, 2011.

Net revenues for the first quarter of fiscal 2012 were $51.5 million, a decrease of $15.7 million, or 23.3%, from the first quarter of fiscal 2011 net revenues of $67.2 million.

Operating income for the first quarter of fiscal 2012 was $3.9 million, a decrease of $3.5 million, or 48.0%, from the first quarter of fiscal 2011 operating income of $7.4 million. The decline in year-over-year operating income was driven by the lower year-over-year net sales as well as higher year-over-year landed product costs as a percent of selling price, partially offset by lower year-over-year selling, general and administrative expenses.

Net income for the first quarter of fiscal 2012 was $3.3 million, a decrease of $2.6 million, or 43.2%, from the first quarter of fiscal 2011 net income of $5.9 million, and was aided by a realized gain of $0.8 million recorded in the first quarter of fiscal 2012 on the sale of a marketable security. Diluted earnings per share for the first quarter of fiscal 2012 were $0.12 as compared to $.22 for the first quarter of fiscal 2011, a decrease of $0.10, or 45.5%.

Duncan Hon, Deputy Chief Executive Officer of Emerson Radio, commented, "As expected, in the first quarter of fiscal 2012, we faced a challenging and highly competitive sales environment, as well as higher product costs due to the continuing appreciation of the renminbi and increases in costs of production in China. These factors led to the year-over-year declines in net revenues and net income for the first quarter. Looking forward, we see these factors continuing throughout the fiscal year. As always, we will remain focused on keeping our costs as low as possible and providing the consumer with the highest level of value in the marketplace on the products we offer."

About Emerson Radio Corp.
Emerson Radio Corporation (NYSE Amex: MSN), founded in 1948, is headquartered in Moonachie, N.J. The Company designs, sources, imports and markets a variety of houseware 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,
2011 2010
Net revenues:
Net revenues $ 51,524 $ 67,155
Costs and expenses:
Cost of sales 45,595 57,523
Other operating costs and expenses 387 299
Selling, general and administrative expenses 1,689 1,929
47,671 59,751
Operating income 3,853 7,404
Other income (expense):
Interest income, net 31 10
Realized gain on sale of marketable security 828 -
Income before income taxes 4,712 7,414
Provision for income taxes 1,375 1,535
Net income 3,337 5,879
Net income per share:
Basic 0.12 0.22
Diluted 0.12 0.22
Weighted average shares outstanding:
Basic 27,130 27,130
Diluted 27,130 27,131
EMERSON RADIO CORP. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands except share data)
6/30/11
(Unaudited) 3/31/2011 (A)
ASSETS
Current Assets:
Cash and cash equivalents $ 21,536 $ 39,796
Restricted cash 2,049 600
Investment in marketable security - 4,725
Accounts receivable, net 30,772 10,929
Other receivables 1,087 1,413
Due from affiliates 15 -
Inventory, net 20,549 8,515
Prepaid expenses and other current assets 504 549
Deferred tax assets 2,235 2,825
Total Current Assets 78,747 69,352
Property, plant, and equipment, net 2,832 2,921
Trademarks and other intangible assets, net 1,545 1,545
Deferred tax assets 1,967 2,540
Other assets 350 358
Total Assets $ 85,441 $ 76,716
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Short-term borrowings - $ 2,466
Current maturities of long-term borrowings 46 46
Accounts payable and other current liabilities 22,683 14,408
Due to affiliates - 2
Accrued sales returns 1,571 1,199
Income taxes payable 244 196
Total Current Liabilities 24,544 18,317
Long-term borrowings 127 150
Deferred tax liabilities 167 158
Total Liabilities 24,838 18,625
Shareholders' Equity:
Preferred shares -- 10,000,000 shares authorized; 3,677 shares issued and outstanding; liquidation preference of $3,677,000 3,310 3,310
Common shares -- $0.01 par value, 75,000,000 shares authorized; 52,965,797 shares issued, and 27,129,832 shares outstanding 529 529
Capital in excess of par value 98,785 98,785
Accumulated other comprehensive (losses) income (82 ) 746
Accumulated deficit (17,715 ) (21,055 )
Treasury stock, at cost, 25,835,965 shares (24,224 ) (24,224 )
Total shareholders' equity 60,603 58,091
Total Liabilities and Shareholders' Equity $ 85,441 $ 76,716
(A) Reference is made to the Company's Annual Report on Form 10-K for the fiscal year ended March 31, 2011 filed with the Securities and Exchange Commission on July 14, 2011.

Contact Information

  • EMERSON RADIO CORP.
    85 Oxford Drive
    Moonachie, NJ 07074

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