Dataram: Fiscal 4Q09 Financial Results

Dataram Corporation reported its financial results for its fiscal fourth quarter and year ended April 30, 2009. Revenues for the fourth quarter were $5,639,000, which compares to $7,045,000 for the comparable prior year period. Revenues for the fiscal year totaled $25.9 million, which compares to $30.9 million for the comparable prior fiscal year.

On March 31, 2009, the Company acquired certain assets of Micro Memory Bank, Inc. (MMB), a privately-held corporation. MMB is a manufacturer of legacy to advanced solutions in laptop, desktop and server memory products which are produced in its facility in Pennsylvania. The operating results of this business unit are incorporated in the Company’s consolidated fourth quarter and fiscal year financial results commencing April 1, 2009. Concerning the acquisition, John H. Freeman, Dataram’s president and CEO commented: “This acquisition was an important part of our strategy to expand and grow our memory solutions business. MMB positions Dataram with a more comprehensive product set, new routes to market and an established customer base. Its products, personnel and reach directly support our strategy to grow our memory solutions business.”

Mr. Freeman continued: “Our operating results in the fourth quarter continued to be impacted by current economic conditions. As recently reported by IDC and Gartner, server sales experienced a 25% sequential decline in the quarter corresponding to our fiscal fourth quarter. Many of our customers have curtailed or temporarily suspended their capital spending while they adapt their business plans to the current environment. We have also seen customers delay their investment in new servers as they wait for products based on Intel’s recently released Nehalem architecture to become available. These systems are now shipping and we are beginning to see an increase in demand for our memory. We cannot predict how long current conditions will continue and we have adapted our business model by reducing our cost structure as well as making process improvements to meet today’s business climate.”

Mr. Freeman further stated: “The development of our new storage product line continues to progress. In our fiscal fourth quarter and twelve months, we invested approximately $490,000 and $1,531,000 respectively in R&D to develop our initial product offering. These products will offer high performance storage improvements as well as cost savings to our clients. Certain clients have completed beta testing of our products and other tests are in process or scheduled. Early client feedback has been very positive. We are continuing to make investments in this product line and anticipate a formal product launch late this year.”

The Company incurred a net loss for the fourth quarter and fiscal year of $1,112,000, or $0.13 per share and $3,135,000, or $0.35 per share, respectively. This compares to net earnings of $401,000, or $0.05 per diluted share and $1,608,000, or $0.18 per diluted share for the comparable prior year periods. In addition to the expenses discussed above, the net loss for the fourth quarter and fiscal year ended April 30, 2009 includes charges of $270,000 and $451,000, respectively related to a reduction in workforce and also includes a charge in the fiscal first quarter of approximately $716,000 related to a retirement agreement entered into with the Company’s former chief executive officer.

Mr. Freeman concluded, “Our financial condition remains strong. Our current ratio is 5.4 and our tangible book value is $2.21 per share, of which cash and equivalents total $1.41 per share. I look forward to reporting on our progress next quarter.”