EX-99.0 3 ex-99.htm EX-99 ex-99.htm

EXHIBIT 99
 

 
Wireless Ronin Reports 2009 Second Quarter Results and Comments on Recently Announced Strategic Partnership with NEC Display Solutions of America, Inc.
 
 
Key 2009 second quarter highlights include: 
 
 
·  
Announced a strategic partnership with NEC Display Solutions of America, Inc.
 
 
·  
Continued improvement in gross margin to 23% in second quarter of 2009 compared to 19% in first quarter of 2009.
 
 
·  
Further reduction in cash burn to $1.8 million in second quarter of 2009 compared to $2.4 million in first quarter of 2009.
 
 
·  
Revenue significantly impacted by collapse of automotive industry and the general economic downturn in early 2009.
 
 
 
MINNEAPOLIS – August 6, 2009 – Wireless Ronin Technologies, Inc. (NASDAQ: RNIN), a leader in digital signage solutions, today announced its financial results for the second quarter of 2009.
 
Second Quarter Results
The Company reported revenue of $1.0 million for the second quarter of 2009, a 40 percent decrease from $1.6 million in the second quarter of 2008.  The Company also reported a second quarter net loss of $2.7 million, or $0.18 per basic and diluted share, compared to a net loss of $5.0 million, or $0.34 per basic and diluted share, in the year-ago quarterly period.  The significant decline in revenue for the second quarter of 2009 compared to the same period in the prior year is primarily attributable to the collapse in the automotive industry.  During the second quarter of 2009, the Company recognized less than $50,000 of revenue from customers in this vertical market compared to approximately $0.6 million or 38 percent of total revenues in the second quarter of 2008.  The year-over-year improvement in the net loss for the 2009 second quarter was primarily the result of the reductions in workforce and other cost cutting measures taken over the previous nine months. Second quarter 2009 results also included costs of approximately $183,000, or $0.01 per basic and diluted share, of non-cash stock compensation expense related to FAS123R compared to approximately $306,000, or $0.02 per basic and diluted share, in 2008.  Revenue for the first half of 2009 totaled $2.4 million compared to $3.5 million in the same period a year-ago.  The Company’s net loss for the first half of 2009 totaled $5.6 million, or $0.37 per basic and diluted share, compared to $9.2 million, or $0.63 per basic and diluted share, in the prior year.
 
Non-GAAP operating loss was $2.1 million or $0.14 per basic and diluted share in the second quarter of 2009 compared to a non-GAAP operating loss of $4.1 million or $0.28 per basic and diluted share in the first quarter of 2008.  Non-GAAP operating loss is defined as the GAAP operating loss with the add-back of certain items.  These items include severance charges totaling $210,000, or $0.01 per basic and diluted share during the second quarter of 2009, compared to $353,000 or $0.02 per basic and diluted share recorded in the second quarter of 2008.  Reconciliation to the GAAP operating loss on a quarterly and six month basis is contained in a table following the financial statements accompanying this release.
 
James C. (Jim) Granger, president and chief executive officer of Wireless Ronin Technologies said, “While we are not satisfied with our revenue generation in the first half of this year, we believe that our recently announced strategic partnership agreement with NEC Display Solutions of America, Inc. has great significance for Wireless Ronin and will create future growth opportunities. We are now able to substantially expand our sales reach by extending our software into the hands of NEC sales personnel across the United States and Canada.  We believe there will be a strong demand from NEC customers requiring a robust, customized solution only offered by our full RoninCast® offering. We will be working closely with NEC over the coming months to provide the necessary training and support for their sales team for them to be able to identify these opportunities.”
 
 
For the second quarter of 2009, gross margin averaged 23 percent, compared to a gross margin of four percent in the second quarter of 2008.  The increase was primarily the result of a shift in revenue from the sale of hardware to the sale of software and services, which yields a higher percentage margin of profitability. An incremental increase in the Company’s recurring software maintenance and hosting fees has also contributed to the increase in gross profit margins.
 
 
Cash and marketable securities, including restricted cash at June 30, 2009, totaled approximately $9.8 million compared to $11.7 million at March 31, 2009, and $14.0 million at the end of 2008.  The decline in cash and marketable securities reflects the continued funding of the Company’s losses during the first half of 2009. “Despite the challenges we face in this economic environment, I am very pleased with the continued improvement in our quarterly cash burn rate and the efficiencies we have built within our organization.  In the second quarter, we continued to see dramatic improvement in our cash utilization, which included approximately $0.5 million of one-time severance payments.  Our operations continue to be impacted by the global recession as most businesses are extending the timing of any large scale digital signage deployments. However, we remain confident that when our current customers and prospects decide to proceed with rolling out a digital signage solution for their mission critical applications that Wireless Ronin will be their vendor of choice,” said Darin McAreavey, vice president and chief financial officer.
 
 
A conference call to review second quarter and full year results, and further discuss our new strategic partnership with NEC Display Solutions of America, Inc,  is scheduled for today at 3:30 p.m. (CT). A live webcast of Wireless Ronin’s earnings conference call can be accessed on the Investor section of its corporate web site at www.wirelessronin.com.  Alternatively, a live broadcast of the call may be heard by dialing (877) 419-6596 inside the United States or Canada, or by calling (719) 325-4862 from international locations.  An operator will direct you to the Wireless Ronin conference call. A webcast replay of the call will be archived on Wireless Ronin’s corporate web site. An archive of the call is also accessible via telephone approximately two hours following the end of the live call by dialing (888) 203-1112 domestically and (719) 457-0820 internationally with pass code 6603144. The conference call archive will be available through September 6, 2009.
 
 
About Wireless Ronin Technologies, Inc.
 
 
Wireless Ronin Technologies (www.wirelessronin.com) is the developer of RoninCast®, a complete software solution designed to address the evolving digital signage marketplace. RoninCast® software provides clients with the ability to manage a digital signage network from one central location and is the only complete, turnkey solution in the digital signage marketplace. The software suite allows for customized distribution with network management, playlist creation and scheduling, and database integration. Wireless Ronin offers an array of services to support RoninCast® software including consulting, creative development, project management, installation, and training. The company's common stock trades on the NASDAQ Global Market under the symbol "RNIN".
 
 
This release contains certain forward-looking statements of expected future developments, as defined in the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect management's expectations and are based on currently available data; however, actual results are subject to future risks and uncertainties which could materially affect actual performance. Risks and uncertainties that could affect such performance include, but are not limited to, the following: estimates of future expenses, revenue and profitability; the pace at which the company completes installations and recognizes revenue; trends affecting financial condition and results of operations; ability to convert proposals into customer orders; the ability of customers to pay for products and services; the revenue recognition impact of changing customer requirements; customer cancellations; the availability and terms of additional capital; ability to develop new products;  dependence on key suppliers, manufacturers and strategic partners; industry trends and the competitive environment; and the impact of losing one or more senior executives or failing to attract additional key personnel. These and other risk factors are discussed in detail in the company's Quarterly Report on Form 10-Q filed with the Securities and Exchange Commission, on May 8, 2009. 
 
 
Contact:
     
 
        Investor
        Darin McAreavey, vice president and chief financial officer
        dmcareavey@wirelessronin.com
        (952) 564 - 3525
 
        Media    
        Linda Hofflander, vice president and chief marketing officer
        lhofflander@wirelessronin.com
        (952) 564 - 3562
 
 
 
 
 
 




WIRELESS RONIN TECHNOLOGIES, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share information)

 
June 30,
  
December 31,
  
 
2009
  
2008
  
 
 (unaudited)
  
 (audited)
  
ASSETS
        
CURRENT ASSETS
        
Cash and cash equivalents
 $9,469
  
 $5,294
  
Marketable securities — available-for-sale
 -
  
 8,301
  
Accounts receivable, net of allowance of  $76 and $92
 728
  
 1,823
  
Income tax receivable
 13
  
 12
  
Inventories
 275
  
 462
  
Prepaid expenses and other current assets
 119
  
 265
  
Total current assets
 10,604
  
 16,157
  
Property and equipment, net
 1,581
  
 1,918
  
Restricted cash
 378
  
 450
  
Other assets
 27
  
 35
  
TOTAL ASSETS
 $12,590
  
 $18,560
  
         
         
LIABILITIES AND SHAREHOLDERS' EQUITY
        
CURRENT LIABILITIES
        
Current maturities of capital lease obligations
 $32
  
 $71
  
Accounts payable
 771
  
 1,068
  
Deferred revenue
 67
  
 181
  
Accrued liabilities
 702
  
 1,067
  
TOTAL LIABILITIES
 1,572
  
 2,387
  
         
COMMITMENTS AND CONTINGENCIES
        
         
SHAREHOLDERS' EQUITY
        
         
Capital stock, $0.01 par value, 66,667 shares authorized
        
Preferred stock, 16,667  shares authorized, no shares issued and outstanding
 -
  
 -
  
Common stock, 50,000 shares authorized; 14,947 and 14,850 shares
        
 issued and outstanding at June 30, 2009 and December 31, 2008, respectively
 149
  
 148
  
Additional paid-in capital
 81,071
  
 80,650
  
Accumulated deficit
 (69,770)
  
 (64,212)
  
Accumulated other comprehensive loss
 (432)
  
 (413)
  
Total shareholders' equity
 11,018
  
 16,173
  
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
 $12,590
  
 $18,560
  
         

 
 
 

 
WIRELESS RONIN TECHNOLOGIES, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts, unaudited)

 
 Three Months Ended
  
 Six Months Ended
 
 June 30,
  
 June 30,
 
2009
  
2008
  
2009
  
2008
               
Sales
              
Hardware
 $263
  
 $496
  
 $766
  
 $1,260
Software
 230
  
 204
  
 396
  
 302
Services and other
 470
  
 896
  
 1,234
  
 1,968
Total sales
 963
  
 1,596
  
 2,396
  
 3,530
               
Cost of sales
              
Hardware
 267
  
 451
  
 718
  
 1,086
Software
 -
  
 -
  
 -
  
 -
Services and other
 476
  
 1,083
  
 1,185
  
 1,983
Total cost of sales (exclusive of depreciation and amortization shown separately below)
 743
  
 1,534
  
 1,903
  
 3,069
Gross profit
 220
  
 62
  
 493
  
 461
               
Operating expenses:
              
Sales and marketing expenses
 603
  
 1,110
  
 1,434
  
 2,330
Research and development expenses
 548
  
 590
  
 939
  
 1,044
General and administrative expenses
 1,545
  
 3,143
  
 3,340
  
 6,079
Depreciation and amortization expense
 193
  
 337
  
 392
  
 588
Total operating expenses
 2,889
  
 5,180
  
 6,105
  
 10,041
Operating loss
 (2,669)
  
 (5,118)
  
 (5,612)
  
 (9,580)
               
Other income (expenses):
              
Interest expense
 (2)
  
 (7)
  
 (5)
  
 (14)
Interest income
 16
  
 165
  
 59
  
 437
Total other income
 14
  
 158
  
 54
  
 423
Net loss
 $(2,655)
  
 $(4,960)
  
 $(5,558)
  
 $(9,157)
Basic and diluted loss per common share
 $(0.18)
  
 $(0.34)
  
 $(0.37)
  
 $(0.63)
Basic and diluted weighted average shares outstanding
 14,854
  
 14,578
  
 14,852
  
 14,561

 
 
 
 
 

WIRELESS RONIN TECHNOLOGIES, INC.
  
2009 SUPPLEMENTARY QUARTERLY FINANCIAL DATA
(In thousands, except percentages and per share amounts)
  
(Unaudited)
    


Supplementary Data
                  
   
2008
  
2009
Statement of Operations
  
Q1
Q2
Q3
Q4
TOTAL
  
Q1
Q2
Sales
  
 $1,934
 $1,596
 $1,950
 $1,902
 $7,382
  
 $1,433
 $963
                   
Cost of sales
  
1,535
 1,534
 1,847
 1,673
 6,589
  
1,160
743
                   
Operating expenses
  
4,861
 5,180
 4,854
 7,210
 22,105
  
3,216
2,889
                   
Interest expense
  
7
 7
 5
 4
 23
  
3
2
                   
Other income, net
  
(272)
 (165)
 (122)
 (84)
 (643)
  
(43)
(16)
                   
Net loss
  
 $(4,197)
 $(4,960)
 $(4,634)
 $(6,901)
 $(20,692)
  
 $(2,903)
 $(2,655)
                   
Stock compensation expense
  
395
 306
 201
 411
 1,313
  
187
183
(included in operating expenses)
                  
                   
Weighted average shares
  
 14,544
 14,578
 14,764
 14,768
 14,664
  
 14,850
 14,871
                   
                   
Reconciliation Between GAAP and Non-GAAP Operating Loss
          
                   
GAAP operating loss
  
 $(4,462)
 $(5,118)
 $(4,751)
 $(6,981)
 $(21,312)
  
 $(2,943)
 $(2,669)
                   
Adjustments:
                  
   Depreciation and amortization
  
 251
 337
 296
 342
 1,226
  
 199
 193
   Old building remaining lease obligation write-off
 -
 -
 -
 56
 56
  
 -
 -
   Termination partnership agreement
  
 -
 -
 -
 50
 50
  
 -
 (50)
   Stock-based compensation expense
  
 395
 306
 201
 411
 1,313
  
 187
 183
   Impairment of network equipment held for sale
 -
 -
 -
 1,766
 1,766
  
 -
 -
   Impairment of intangible assets
  
 -
 -
 -
 1,265
 1,265
  
 -
 -
   Severance
  
 120
 353
 286
 274
 1,033
  
 237
 210
                   
Total operating expense adjustment
  
 766
 996
 783
 4,164
 6,709
  
 623
 536
                   
Non-GAAP operating loss
  
 $(3,696)
 $(4,122)
 $(3,968)
 $(2,817)
 $(14,603)
  
 $(2,320)
 $(2,133)
Non-GAAP operating loss per common share
 $(0.25)
 $(0.28)
 $(0.27)
 $(0.19)
 $(1.00)
  
 $(0.16)
 $(0.14)
                   
                   
Reconciliation Between GAAP and Non-GAAP Gross Profit Margin
          
                   
GAAP sales
  
 $1,934
 $1,596
 $1,950
 $1,902
 $7,382
  
 $1,433
 $963
Deferred customer revenue
  
 -
 80
 -
 -
 80
  
 -
 -
Network operations center
  
(96)
 (39)
 (99)
 (100)
 (334)
  
(71)
(121)
Non-GAAP sales
  
1,838
1,637
1,851
1,802
7,128
  
1,362
842
                   
GAAP cost of sales
  
 1,535
 1,534
 1,847
 1,673
 6,589
  
 1,160
 743
Deferred customer costs
  
48
 51
 -
 -
 99
  
 -
 -
Inventory adjustment
  
 -
 -
 -
 (65)
 (65)
  
 -
 -
Network operations center
  
(191)
 (281)
 (318)
 (257)
 (1,047)
  
(169)
(167)
Non-GAAP cost of sales
1,392
1,304
1,529
1,351
5,576
  
991
576
                   
Non-GAAP gross profit
  
 $446
 $333
 $322
 $451
 $1,552
  
 $371
 $266
                   
GAAP gross profit margin
  
20.6%
3.9%
5.3%
12.0%
10.7%
  
19.1%
22.8%
Non-GAAP gross profit margin
  
24.3%
20.3%
17.4%
25.0%
21.8%
  
27.2%
31.6%