PTNX Printronix (MM)

Printronix, Inc. (NASDAQ:PTNX), the leading manufacturer of integrated enterprise printing solutions for the supply chain, today announced results for the first quarter ended June 29, 2007. Revenue decreased to $30.6 million for the first quarter of fiscal year 2008 compared to $31.7 million in the same quarter last year. The company reported net income for the quarter of $1.0 million, or $0.16 per diluted share, compared with net income of $0.6 million, or $0.09 per diluted share for the same quarter of the prior fiscal year. �We were pleased with our improved profitability in the first quarter, which continues to reflect our focus on cost containment and expense controls,� said Robert Kleist, president and CEO of Printronix. �Despite the decline in sales due largely to lower sales to a major direct customer, we are seeing good demand for our broad range of thermal printers, including the recently introduced mid-range thermal label printer, and our line matrix printers.� The gross margin increased to 40.3% for the first quarter of fiscal 2008, up from 39.2% in the first quarter of fiscal 2007 primarily due to price increases on certain products, lower worldwide manufacturing costs and the improving value of the Euro. Operating expenses in the first quarter of fiscal 2008 were $11.6 million, down from $12.0 million in the first quarter of fiscal year 2007. Engineering and development expenses were $2.9 million, down from $3.1 million in the same quarter last year. Sales and marketing expenses were $5.7 million, down from $6.0 million in the same quarter last year. General and administrative expenses were $3.0 million, up from $2.9 million in the same quarter last year. The company ended the first fiscal quarter of 2008 with cash and short-term investments of $26.2 million, down from $38.6 million at the end of the first quarter of fiscal 2007, and down from $38.9 million at the end of fiscal year 2007. The decrease in cash and short-term investments from the prior quarter is primarily due to a $12.8 million scheduled payment on a long-term note, which paid the loan in full. During the first quarter, the company also declared and paid $0.6 million for its quarterly cash dividend of $0.10 per share. Fiscal 2008 Second Quarter Outlook Printronix also announced that its second quarter revenue is expected to be within a range of $29.5 million and $31.0 million, and earnings are expected to be within a range from $0.05 to $0.15 per share. Conference Call There will be an earnings conference call at 1:30 p.m. ET (10:30 a.m. PT) on Monday, August 6, 2007. The call will be broadcast live over the Internet and will be hosted by Robert Kleist, President and CEO, and George Harwood, Senior Vice President and CFO. To access the live audio web cast, go to the Printronix web site at www.printronix.com and select the conference call link to register. If you are unable to listen to the live web cast, it will be archived for replay on the web site. To listen to the live conference call via the telephone, you can access the call at 866-409-1555. Shortly after the call, a telephonic replay will be available through August 20, 2007, by dialing 888-203-1112 or 719-457-0820. Passcode I.D. 5720740 is required for both the telephonic live call and the telephonic replay. Except for historical information, this press release contains �forward-looking statements� about Printronix, within the meaning of the Private Securities Litigation Reform Act of 1995. Terms such as �objectives,� �believes,� �expects,� �plans,� �intends,� �should,� �estimates,� �anticipates,� �forecasts,� �projections,� and variations of such words and similar expressions are intended to identify such forward-looking statements. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including: adverse business conditions and a failure to achieve growth in the computer peripheral industry and in the economy in general; the ability of the company to achieve growth in the Asia Pacific market; adverse political and economic events in the company�s markets; a worsening of the global economy due to general conditions; a worsening of the global economy resulting from terrorist attacks or risk of war; a worsening of the global economy resulting from an outbreak of avian flu or other world health epidemic; the ability of the company to maintain its production capability in its Singapore plant or obtain product from its Asia Pacific suppliers should a world health epidemic occur; the ability of the company to hold or increase market share with respect to line matrix printers; the ability of the company to successfully compete against entrenched competition in the thermal printer market; the ability of the company to adapt to changes in requirements for radio frequency identification (�RFID�) products by Wal*Mart and/or the Department of Defense (the �DOD�) and others; the ability of the company to attract and to retain key personnel; the ability of the company�s customers to achieve their sales projections, upon which the company has in part based its sales and marketing plans; the ability of the company to retain its customer base and channel; the ability of the company to compete against alternate technologies for applications in its markets; the ability of the company to continue to develop and market new and innovative products superior to those of the competition and to keep pace with technological change; and that InfoPrint Solutions Company (�InfoPrint Solutions� or �JV of IBM/Ricoh�), the successor entity to IBM�s Printing Systems Division, may change its product and marketing focus in a way that reduces its purchase of Printronix products. The company does not undertake to publicly update or revise any of its forward-looking statements, even if experience or new information shows that the indicated results or events will not be realized. About Printronix, Inc. Since 1974, Printronix, Inc. (NASDAQ:PTNX) has created innovative printing solutions for the industrial marketplace and supply chain. The company is the worldwide market leader in enterprise solutions for line matrix printing and has earned an outstanding reputation for its high-performance thermal bar code and fanfold laser printing solutions. Printronix also has become an established leader in pioneering technologies, including radio frequency identification (RFID) printing, bar code compliance and networked printer management. Printronix is headquartered in Irvine, California. For company information, see www.printronix.com. PRINTRONIX, INC. AND SUBSIDIARIES � CONSOLIDATED STATEMENTS OF OPERATIONS ($ in thousands, except share and per share data) (unaudited) � Three Months Ended June 29, March 30, June 30, 2007 2007 2006 � Revenue $ 30,641 $ 32,620 $ 31,650 Cost of sales � 18,286 � � 20,373 � � 19,251 � � Gross margin 12,355 12,247 12,399 � Engineering and development 2,876 3,002 3,139 Sales and marketing 5,749 6,150 5,955 General and administrative � 2,986 � � 3,333 � � 2,861 � � Total operating expenses 11,611 12,485 11,955 � Income (loss) from operations 744 (238 ) 444 Interest and other income, net � (422 ) � (341 ) � (249 ) � Income before taxes 1,166 103 693 � Provision (benefit) for income taxes � 139 � � (48 ) � 137 � � Net income $ 1,027 � $ 151 � $ 556 � � Net income per share: Basic $ 0.16 $ 0.02 $ 0.09 Diluted $ 0.16 $ 0.02 $ 0.09 � Shares used in computing net income per share: Basic 6,385,451 6,328,531 6,283,591 Diluted 6,508,411 6,459,718 6,460,220 � Gross margin % 40.3 % 37.5 % 39.2 % Operating expenses % 37.9 % 38.3 % 37.8 % Income (loss) from operations % 2.4 % -0.7 % 1.4 % Net income % 3.4 % 0.5 % 1.8 % PRINTRONIX, INC. AND SUBSIDIARIES � Consolidated Balance Sheets ($ in thousands) (unaudited) � June 29, March 30, June 30, 2007 2007 2006 ASSETS Cash and cash equivalents $ 17,976 $ 26,847 $ 36,585 Short-term investments 8,200 12,015 2,019 Accounts receivable, net 19,379 20,776 20,433 Inventories, net 16,275 15,281 15,332 Other current assets 1,935 2,047 2,238 Property, plant and equipment, net 28,320 29,113 30,942 Other long-term assets � 991 � 948 � 660 � Total assets $ 93,076 $ 107,027 $ 108,209 � LIABILITIES and STOCKHOLDERS' EQUITY Accounts payable $ 7,748 $ 9,452 $ 9,137 Other current liabilities 10,830 11,158 13,133 Current portion of long-term debt - 12,775 13,300 Other long-term liabilities 2,230 1,688 2,049 Stockholders' equity � 72,268 � 71,954 � 70,590 � Total liabilities and stockholders' equity $ 93,076 $ 107,027 $ 108,209 PRINTRONIX, INC. AND SUBSIDIARIES � Sales Classification (unaudited) � Three Months Ended Percent of Total Sales June 29, June 30, Percent June 29, June 30, Sales by Geographic Region 2007 2006 Change 2007 2006 ($ in thousands) Americas $ 14,570 $ 16,188 -10.0 % 47.5 % 51.1 % EMEA $ 10,474 $ 10,179 2.9 % 34.2 % 32.2 % Asia Pacific $ 5,597 $ 5,283 5.9 % 18.3 % 16.7 % � $ 30,641 $ 31,650 -3.2 % 100.0 % 100.0 % � Three Months Ended Percent of Total Sales June 29, June 30, Percent June 29, June 30, Sales by Product Technology 2007 2006 Change 2007 2006 ($ in thousands) Line matrix $ 21,109 $ 22,748 -7.2 % 68.9 % 71.9 % Thermal $ 7,082 $ 6,245 13.4 % 23.1 % 19.7 % Laser $ 2,450 $ 2,657 -7.8 % 8.0 % 8.4 % � $ 30,641 $ 31,650 -3.2 % 100.0 % 100.0 % � � � Three Months Ended Percent of Total Sales June 29, June 30, Percent June 29, June 30, Sales by Channel 2007 2006 Change 2007 2006 ($ in thousands) OEM $ 7,400 $ 7,861 -5.9 % 24.2 % 24.8 % Distribution $ 21,823 $ 21,114 3.4 % 71.2 % 66.7 % Direct $ 1,418 $ 2,675 -47.0 % 4.6 % 8.5 % � $ 30,641 $ 31,650 -3.2 % 100.0 % 100.0 % � Three Months Ended Percent of Total Sales June 29, June 30, Percent June 29, June 30, Sales by Customer 2007 2006 Change 2007 2006 ($ in thousands) InfoPrint Solutions (JV of IBM / Ricoh) $ 6,170 $ 5,609 10.0 % 20.1 % 17.7 % Second largest customer $ 1,271 $ 632 101.1 % 4.1 % 2.0 % Third largest customer $ 1,141 $ 2,534 -55.0 % 3.7 % 8.0 % Total top ten customers $ 14,190 $ 14,941 -5.0 % 46.3 % 47.2 %