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Dataram Reports Fourth Quarter and Fiscal Year 2016 Financial Results

- Sharpening Focus on International Growth and Revenue Generation in Challenging Memory Market

PRINCETON, N.J., Aug. 2, 2016 — (PRNewswire) —  Dataram Corporation (NASDAQ: DRAM), an independent manufacturer of memory products and provider of performance solutions, on July 29, 2016 reported its financial results for the fourth quarter and fiscal year ended April 30, 2016.

"While our efforts in 2016 built on the financial and operational initiatives established in 2015 to turn around and transform the memory business, we continue to face challenging and hypercompetitive conditions in the memory market," said Dataram Chairman and CEO Dave Moylan. "As before, we continue to take actions to address the current environment and strengthen business, and are implementing initiatives that continue to reduce costs and increase operating efficiencies while expanding our footprint and diversifying our business through acquisitions."

Financial Highlights:

Mr. Moylan continued, "In 2016, part of growth strategy centered on increasing international sales volume.  International revenue increased approximately 10% and shipments more than 40% during the reporting period.  We continued to strengthen our global footprint and increase brand awareness while expanding our distribution channels and partner network both domestically and internationally."

Even with international growth, Dataram's global revenues decreased slightly even after reflecting the revenue loss associated with the exit of the unprofitable consumer business and the pull back from the non-core brokering business.   The primary driver is that while the Company's overall unit shipments increased more than 35%, the average selling price for these shipments decreased more than 40% during the same period.  

The Company's operational and financial improvements over the last 18 months have helped reduce annual cash operating costs more than $4.5 million.  Of the $1.2 million loss in 2016, approximately $746,000 was due to stock based expenses and $166,000 was due to uncollectable receivables.   In January 2016, the Company eliminated nearly $680,000 in debt and an associated 8% note obligation and exchanged the Series A shares for Series B shares to extinguish the 8% preferred Series A dividend and anti-dilution protection in the Preferred Series A agreements.

On June 14, 2016, Dataram announced an agreement to acquire all of the outstanding shares of U.S. Gold Corp ("USGC") and USGC subsidiaries. USGC is a U.S.-focused gold exploration and development company advancing two high potential projects in mining friendly Nevada and Wyoming. Dataram believes that the acquisition will notably strengthen the balance sheet and working capital as well as improve the memory business margins through sharing of public company costs across business and reduction of duplicate costs. Additionally, the transaction is an all equity transaction and "turn-key" in that USGC has seasoned management team in place to execute. Closing of the acquisition of USGC is subject to usual and customary conditions, including the approval of shareholders.

Mr. Moylan concluded, "In 2017, we will continue our focus on improving the memory business while evaluating acquisitions to diversify the Company's business, reduce costs, and our increase portfolio of assets across sectors.  We will continue to pursue high-value opportunities with compelling value propositions while making and managing risk/reward tradeoffs.  We look forward to providing our shareholders updates to the closing of the USGC acquisition and believe this will significantly benefit our shareholders and future investors."

***** Financial Tables Follow *****

DATARAM CORPORATION and Subsidiaries

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited)






Fourth Quarter Ended

April 30,


Twelve Months Ended

April 30,


2016


2015


2016


2015









Revenues

$     5,189


$   5,603


$   25,182


$   28,258









Costs and expenses:








      Cost of sales

4,383


4,874


20,464


24,068

      Engineering and development

56


192


191


767

      Selling, general and administrative

1,324


1,319


5,021


6,158

      Stock-based compensation expense*

80


5


746


14


5,843


6,390


$   26,422


$   31,007

Loss from operations

(654)


(787)


(1,240)


(2,749)

Other income (expense)

(17)


(107)


(168)


(1,077)

Loss before income taxes

(671)


(894)


(1,408)


(3,826)

Gain on sale of state NOL, (tax expense)

(3)


-


187


(3)

Net loss

$      (674)


$    (894)


$   (1,221)


$   (3,829)









Net loss per share:








       Basic **

$     (0.42)


$   (0.97)


$     (0.97)


$     (4.53)

Weighted average number of shares








outstanding:








       Basic **

1,624


925


1,255


846

 

* Items are recorded as a component of operating costs and expenses in the Company's financial statements filed with the Securities and Exchange Commission on Form 10-Q.

** Share amounts and per share data have been adjusted to reflect a 1 for 3 stock split effective July 11, 2016

DATARAM CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

(Unaudited)








April 30, 2016


April 30, 2015

ASSETS





Current assets





   Cash and cash equivalents


$        56


$         327

   Accounts receivable, net


2,746


2,171

   Inventories, net


1,336


2,089

   Other current assets


123


69

      Total current assets


4,261


4,656






Property and equipment, net


51


121






Other assets


30


49






Capitalized software development cost, net


326


366






Goodwill


1,083


1,083






Total assets


$     5,751


$    6,275






LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities





   Note payable-revolving credit line


$     1,776


$     2,109

   Accounts payable


737


880

   Accrued liabilities


159


282

   Convertible notes payable, net of discount


-


600

   Convertible notes payable related parties, net of discount


80


108

      Total current liabilities


2,752


3,979






   Other liabilities


107


179

      Total liabilities


2,859


4,158






Total Stockholders' equity


2,892


2,117






Total liabilities and stockholders' equity


$     5,751


$    6,275

 

About Dataram Corporation

Dataram is an independent manufacturer of memory products and provider of performance solutions that increase the performance and extend the useful life of servers, workstations, desktops and laptops sold by leading manufacturers such as Dell, Cisco, Fujitsu, HP, IBM, Lenovo and Oracle. Dataram's memory products and solutions are sold worldwide to OEMs, distributors, value-added resellers and end users. Additionally, Dataram manufactures and markets a line of Intel Approved memory products for sale to manufacturers and assemblers of embedded and original equipment. 70 Fortune 100 companies are powered by Dataram. Founded in 1967, the Company is a US based manufacturer, with presence in the United States, Europe and Asia. For more information about Dataram, visit www.dataram.com.

Safe Harbor
The information provided in this press release may include forward-looking statements relating to future events, such as the development of new products, pricing and availability of raw materials or the future financial performance of the Company, and the pending acquisition of US Gold Corp, and any anticipated benefits of the merger, and the success of US Gold with respect to any of its exploration activities.  Actual results may differ from such projections and are subject to certain risks including, without limitation, risks arising from: changes in the price of memory chips, changes in the demand for memory systems, increased competition in the memory systems industry, order cancellations, delays in developing and commercializing new products, risks with respect to US Gold faced by junior exploration companies generally engaged in pre-production activities, and other factors described in the Company's most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, filed with the Securities and Exchange Commission, which can be reviewed at  www.sec.gov.  The Company has based these forward-looking statements on its current expectations and assumptions about future events.  While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory, and other risks, contingencies, and uncertainties, most of which are difficult to predict and many of which are beyond the Company's control.  The Company does not assume any obligations to update any of these forward-looking statements.

For additional information, please contact:
Robert Haag                                                                                      
Managing Director                                                                                          
IRTH Communications
866-976-4784
Email Contact

Dataram Contact:
Jeffrey Goldenbaum                                                                                     
Director, Marketing                                                                                         
609-799-0071
Email Contact 

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SOURCE Dataram Corporation

Contact:
Dataram Corporation
Web: http://www.dataram.com