IOM Iomega Corp

Files Form 10-Q with the SEC SAN DIEGO, May 9 /PRNewswire-FirstCall/ -- Iomega Corporation (NYSE:IOM) today reported net revenue of $95.9 million and net income of $1.9 million, or $0.04 per diluted share, for the quarter ended March 30, 2008. In comparison, first quarter 2007 net revenue was $76.0 million with net income of $1.1 million, or $0.02 per diluted share. Additional information about Iomega's first quarter financial results is contained in our first quarter 10-Q, filed today with the SEC. Cash, cash equivalents, long term cash and temporary investments decreased $16.9 million from the end of December 2007 due primarily to timing of working capital requirements during the quarter. During April, we generated approximately $7 million of cash excluding the previously announced $7.5 million termination fee paid to the ExcelStor Group. About Iomega Iomega Corporation, headquartered in San Diego, is a worldwide leader in innovative storage and network security solutions for small- and mid-sized businesses, consumers and others. The Company has sold more than 400 million digital storage drives and disks since its inception in 1980. Today, Iomega's product portfolio includes industry leading network attached storage products, external hard drives, and the own award-winning removable storage technology, the REV(R) Backup Drive. OfficeScreen(R), Iomega's managed security services, which are available in the U.S. and select markets in Europe, provide enterprise quality perimeter security and secure remote network access for SMBs, which help protect small enterprises from data theft and liability. To learn about all of Iomega's digital storage products and managed services solutions, please go to the Web at http://www.iomega.com/. Resellers can visit Iomega at http://www.iomega.com/ipartner. Copyright(C) 2008 Iomega Corporation. All rights reserved. Iomega, Zip, REV, and OfficeScreen are either registered trademarks or trademarks of Iomega Corporation in the United States and/or other countries. Certain other product names, brand names and company names may be trademarks or designations of their respective owners. Legal Statements THIS PRESS RELEASE IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT AN OFFER TO BUY OR THE SOLICITATION OF AN OFFER TO SELL ANY SECURITIES. THE SOLICITATION AND THE OFFER TO BUY SHARES OF IOMEGA'S COMMON STOCK IS ONLY BEING MADE PURSUANT TO THE TENDER OFFER STATEMENT ON SCHEDULE TO, INCLUDING THE OFFER TO PURCHASE, THE RELATED LETTER OF TRANSMITTAL AND OTHER TENDER OFFER MATERIALS THAT EMERGE MERGER CORPORATION, A WHOLLY OWNED SUBSIDIARY OF EMC CORPORATION, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 24, 2008, AS AMENDED. IOMEGA HAS ALSO FILED A SOLICITATION/RECOMMENDATION STATEMENT WITH THE SECURITIES AND EXCHANGE COMMISSION IN CONNECTION WITH THE TENDER OFFER. IOMEGA STOCKHOLDERS SHOULD READ THESE MATERIALS CAREFULLY PRIOR TO MAKING ANY DECISIONS WITH RESPECT TO THE OFFER BECAUSE THEY CONTAIN IMPORTANT INFORMATION, INCLUDING THE TERMS AND CONDITIONS OF THE OFFER. IOMEGA STOCKHOLDERS WILL BE ABLE TO OBTAIN THE TENDER OFFER STATEMENT ON SCHEDULE TO, THE OFFER TO PURCHASE, THE RELATED LETTER OF TRANSMITTAL , THE SOLICITATION/RECOMMENDATION STATEMENT AND OTHER RELATED MATERIALS WITH RESPECT TO THE OFFER, FREE OF CHARGE AT THE WEBSITE OF THE SECURITIES AND EXCHANGE COMMISSION AT http://www.sec.gov/. IN ADDITION, A COPY OF THESE MATERIALS MAY BE OBTAINED AT NO CHARGE BY DIRECTING A REQUEST BY MAIL TO MORROW & CO., INC., 470 WEST AVENUE, STAMFORD, CONNECTICUT 06902 OR BY CALLING TOLL-FREE (800) 607-9400. Media, please contact: Chris Romoser, Iomega Corporation, (858) 314-7148, Analysts/Investors, please contact: Preston Romm, Iomega Corporation, (858) 314-7188, IOMEGA CORPORATION CONDENSED STATEMENTS OF OPERATIONS - QTD (In thousands, except per share data) (Unaudited) For the Three Months Ended Mar. 30, % of Apr. 1, % of Dec. 31, % of 2008 Sales 2007 Sales 2007 Sales Sales $95,900 100.0% $75,984 100.0% $120,644 100.0% Cost of Sales 81,927 85.4% 61,681 81.2% 99,783 82.7% Gross margin 13,973 14.6% 14,303 18.8% 20,861 17.3% Operating Expenses: Selling, general and administrative (1) 10,615 11.1% 10,120 13.3% 14,610 12.1% Research and development 1,929 2.0% 1,739 2.3% 2,711 2.2% License and patent fee income (1,278) (1.3%) (350) (0.5%) (3,500) (2.9%) Goodwill impairment charge - 0.0% 1,710 2.3% - 0.0% Restructuring reversals - 0.0% (38) (0.1%) (109) (0.1%) Total operating expenses 11,266 11.7% 13,181 17.3% 13,712 11.4% Operating Income 2,707 2.8% 1,122 1.5% 7,149 5.9% Interest and other income and expense, net 229 0.2% 255 0.3% 1,083 0.9% Income Before Income Taxes 2,936 3.1% 1,377 1.8% 8,232 6.8% Provision for Income Taxes (991) (1.0%) (228) (0.3%) (1,710) (1.4%) Net Income $1,945 2.0% $1,149 1.5% $6,522 5.4% Net Income Per Share $0.04 $0.02 $0.12 Diluted Income Per Share $0.04 $0.02 $0.12 Weighted Average Common Shares Outstanding 54,765 54,733 54,764 Weighted Average Common Shares Outstanding - Assuming Dilution 55,384 54,979 55,305 (1) Q1 2008 and Q4 2007 includes $0.7 million and $1.2 million of professional fees paid to 3rd parties in connection with the anticipated ExcelStor Group and/or EMC acquisition, respectively. PRODUCT SALES AND OPERATING INCOME (LOSS) - QTD (In thousands) (Unaudited) For the Three Months Ended Mar. 30, % of Apr. 1, % of Dec. 31, % of 2008 Sales 2007 Sales 2007 Sales Sales: Consumer Products: Consumer Storage Solutions (1) $74,989 78.2% $52,489 69.1% $96,863 80.3% Zip 2,803 2.9% 5,518 7.3% 2,853 2.4% Business Products: REV 6,835 7.1% 11,204 14.7% 9,186 7.6% Network Storage Systems (2) 9,078 9.5% 4,738 6.2% 8,949 7.4% Services (3) 1,984 2.1% 1,892 2.5% 2,763 2.3% Other Products 211 0.2% 143 0.2% 30 0.0% Total Sales $95,900 $75,984 $120,644 Product Operating Income (Loss): Consumer Products: Consumer Storage Solutions (1) $(999) $354 $2,641 Zip (4) 1,543 355 1,056 Business Products: REV 272 304 252 Network Storage Systems (2) 700 409 (206) Services (3) (99) (520) (51) Other Products (5)(6) 1,290 182 3,348 Restructuring reversals - 38 109 Operating Income $2,707 $1,122 $7,149 (1) Consumer Storage Solutions is comprised of hard disk, optical and floppy drives. (2) Includes Network HDD drives. (3) Includes the System Integration and Managed Services businesses of CSCI, Inc. and miscellaneous Iomega services. (4) Q1 2007 included a pre-tax, non-cash $1.7 million goodwill impairment charge. (5) Q4 2007 includes a pre-tax, cash benefit of $3.5 million related to a prior license of intellectual property. (6) Q1 2008 includes a pre-tax, cash benefit of $1.3 million related to patent sales and license of intellectual property. IOMEGA CORPORATION CONDENSED BALANCE SHEETS (In thousands) (Unaudited) Mar. 30, Dec. 31, 2008 2007 ASSETS: Cash and cash equivalents $39,699 $53,559 Restricted cash 107 93 Temporary investments 7,909 9,961 Total cash 47,715 63,613 Trade receivables, net 41,000 41,101 Inventories 59,078 79,883 Deferred income taxes 2,175 2,175 Other current assets 3,323 2,902 Total Current Assets 153,291 189,674 Property and equipment, net 3,452 3,867 Long-term cash investments - 1,000 Intangible and other assets 10,617 10,667 $167,360 $205,208 LIABILITIES AND STOCKHOLDERS' EQUITY: Accounts payable $26,148 $61,951 Income taxes payable 3,839 3,368 Other current liabilities 23,196 27,862 Total Current Liabilities 53,183 93,181 Deferred income taxes 7,644 8,220 Long-term liabilities 2,983 2,652 Stockholders' equity 103,550 101,155 $167,360 $205,208 CONDENSED STATEMENTS OF CASH FLOWS - YTD (In thousands) (Unaudited) For the Three Months Ended Mar. 30, Apr. 1, 2008 2007 Cash Flows from Operating Activities: Net Income $1,945 $1,149 Revenue and Expense Adjustments (1) 1,104 2,246 3,049 3,395 Changes in Assets and Liabilities: Trade receivables 337 7,325 Restricted cash (14) - Inventories 20,352 901 Other current assets (421) 444 Accounts payable (35,803) 225 Accrued restructuring - (1,501) Other current liabilities and income taxes (4,195) (2,178) Net cash used in operating activities (16,695) 8,611 Cash Flows from Investing Activities: Purchases of property and equipment (263) (117) Proceeds from sales of assets 2 49 Sales of temporary investments 8,075 3,704 Purchases of temporary investments (4,984) (2,054) Net change in other assets and other liabilities - 44 Net cash provided by investing activities 2,830 1,626 Cash Flows from Financing Activities: Proceeds from sales of Common Stock 5 2 Tax benefit from dispositions of employee stock - - Net cash provided by financing activities 5 2 Net (Decrease) Increase in Cash and Cash Equivalents (13,860) 10,239 Cash and Cash Equivalents at Beginning of Period 53,559 56,617 Cash and Cash Equivalents at End of Period $39,699 $66,856 (1) 2007 includes a $1.7 million non-cash, goodwill impairment charge. DATASOURCE: Iomega Corporation CONTACT: Media, Chris Romoser, +1-858-314-7148, , or Analysts-Investors, Preston Romm, +1-858-314-7188, , both of Iomega Corporation Web site: http://www.iomega.com/

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