SAN JOSE, Calif.--(BUSINESS WIRE)--April 15, 1997--Cornerstone
Imaging, Inc., a leading provider of software and display products
for electronic document applications today released operating results
for the quarter ending March 31, 1997.
Doesn't seem to have raised the price much. Also not much detail on software growth. InputAccel "strong" but no numbers. Seems like they are particularly optimistic about relationship with Adobe Acrobat.
First quarter 1997 highlights include:
-- Revenues of $26M increased 46% from Q1 96, decreased 13% from
seasonally strong Q4 96
-- EPS at $0.14 in Q1 compared to $0.17 in Q4 96 and a loss of
$0.33 in Q1 96
-- Strong balance sheet, cash at $22 million
-- Stock repurchase program initiated
-- Adobe partnership with InputAccel for publishing on the Web
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Summary financial results:
(dollars and shares in millions)
Q1:97 Q4:96 Q1:96(a)
Revenues $ 26.0 $ 29.8 $ 17.8
Gross margin 34.8% 33.9% 30.2%
Pretax margin 6.1% 6.2% (13.9)%
Pretax income 1.6 1.8 (3.6)
Net income (loss) $ 1.1 $ 1.3 $(2.5)
EPS $ 0.14 $ 0.17 $(0.33)
Cash and marketable securities $ 22.0 $18.5 $ 8.2
Weighted average shares 7.6 7.6 7.4
Note (a): includes $1.4M restructuring charge
Revenues for Q1 1997 of $26 million were down 13% from the record
high in Q4 1996 but were up 46% from $17.8 million in Q1 last year.
Thomas T. van Overbeek, President and Chief Executive Officer of
Cornerstone Imaging, commented, "Revenues for the quarter met our
expectations. The 46% year over year increase is a result of revenue
growth in both our display and software businesses."
For Q1 1997, gross margins were 34.7% compared with 33.9% in Q4
1996 and 30.2% in Q1 1996. The improvement in margins from Q4 1996
and Q1 1996 is primarily a result of increased revenues in higher
margin software products and lower costs for display products.
Cornerstone benefited from the dollar strengthening against the
Japanese yen and recorded a foreign exchange gain of approximately
$500,000 in Q1 1997. Such gains in prior quarters were not
significant.
Net income for Q1 1997 was $1.1 million, or 14 cents per share,
compared with $1.3 million, or 17 cents per share, in Q4 1997 and a
net loss of $2.5 million, or 33 cents per share, in Q1 1996.
Cash and marketable securities increased $3.5 million in Q1 1997
to $22 million. Inventory was unchanged at $10.7 million. Accounts
receivable decreased from $17.2 million at the end of Q4 1996 to
$12.7 million. "We ended the quarter with cash at a record high.
We anticipate building our inventory position in the next couple of
quarters to satisfy forecasted sales needs and plan to continue with
the repurchase up to $5 million of Cornerstone stock, so we expect
some decline in cash balances in Q2," commented van Overbeek.
Management Comments
According to van Overbeek, "Due to seasonality, Q1 is
traditionally Cornerstone's softest quarter. In that context we
found demand from our traditional production imaging customers to be
healthy and in line with our expectations. In Q1 1997, the 46% year
over year revenue growth was the highest we have experienced in a
number of years. We see no change in the growth rate for production
document imaging, however we do see a shift away from proprietary
systems solutions and towards open systems architectures based on
standards.
"We are pleased by the acceptance of ImageAccel 3.0, our latest
generation display controller for electronic document applications,
and achieved record unit shipments for controllers in Q1.
"InputAccel also achieved record revenues and grew 25% from Q4 1996.
We believe this is additional validation of InputAccel's market
acceptance and expect continued momentum.
"Cornerstone's partnership with Adobe announced during Q1,
combining the strengths of Adobe's Acrobat Capture 2.0 and
InputAccel, is extremely important. We believe that the combination
of Acrobat Capture and InputAccel is a strong solution for publishing
document based information on the Web. Our research indicates that
in 3 to 5 years the web publishing market will be a significant
market for InputAccel."
About Cornerstone
Cornerstone Imaging, Inc., headquartered in San Jose, CA, is a
leading provider of display products and document capture software
for document imaging enterprise applications. Cornerstone's high
performance monitors and graphics controllers are designed for
all-day computer users who access multiple applications and
data-types. Cornerstone software products facilitate the scanning
and capture of paper-based information. Cornerstone Imaging, Inc.
is a publicly held company traded on the Nasdaq under the CRNR
symbol. Visit the Cornerstone Web Site at corimage.com .
This Press Release contains forward-looking statements that
involve risk and uncertainties. The Company's actual results may
differ materially from the results discussed in the forward-looking
statements. Factors that might cause such a difference include, but
are not limited to, those discussed in "Risk Factors" in the
Company's 1996 Annual Report on Form 10-k as well as the following:
the emergence of the document image processing market, potential
fluctuations in quarterly results, competition, new products and
technological change, general economic conditions and dependence on
capital spending of customers, a lengthy sales cycle and dependence
on systems sales, inherent risks associated with international sales
and international sources of supply, limited sources of supply and
reliance on third-party manufacturers and distributors, and
dependence on key personnel.
FINANCIAL TABLES FOLLOW
For more information on Cornerstone Imaging, Inc. via fax,
dial 1-800-PRO-INFO, code 045. No cost.
CORNERSTONE IMAGING, INC.
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS)
March 31, 1997 December 31, 1996
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 22,010 $ 18,486
Accounts receivable 12,698 17,181
Inventories 10,738 10,710
Deferred income taxes
and other current assets 5,961 4,513
Total current assets 51,407 50,890
Property and equipment, net 2,844 2,859
Other assets 594 1,094
-------- --------
$ 54,845 $ 54,843
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 7,965 $ 10,093
Deferred revenue 839 761
Accrued liabilities 6,711 4,971
Total current liabilities 15,515 15,825
Stockholders' equity:
Common stock 76 76
Paid in capital 30,171 30,914
Retained earnings 9,083 8,028
Stockholders' equity 39,330 39,018
-------- --------
$ 54,845 $ 54,843
CORNERSTONE IMAGING, INC.
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
Three Months Ended March 31,
1997 1996
Net revenues $26,014 $ 17,832
Cost of revenues 16,962 12,454
Gross profit 9,052 5,378
Research and development 2,400 2,641
Sales general
and administrative 5,741 4,967
Restructuring charge ____ 1,404
Operating income (loss) 911 (3,634)
Foreign exchange gains
and interest income 686 88
Income (loss) before
benefit (provision)
for income taxes 1,597 (3,546)
Benefit (provision)
for income taxes (542) 1,065
Net income (loss) $1,055 $ (2,481)
Net income (loss)
per share $.14 $ (0.33)
Shares used in
per share calculation 7,595 7,423
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