<PAGE>
CONFORMED
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
SEPTEMBER 30, 1997; OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM _______________
TO ______________.
COMMISSION FILE NUMBER: 0-20728
-------
RIMAGE CORPORATION
--------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Minnesota 41-1577970
------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
7725 Washington Avenue South, Edina, MN 55439
------------------------------------------------
(Address of principal executive offices)
612-944-8144
------------------------------------------------------
(Registrant's telephone number, including area code)
NA
----------------------------------------------------------------
(Former name, former address, and former fiscal year, if changed since
last report.)
Common Stock outstanding at November 12, 1997 -- 3,090,502 shares
of $.01 par value Common Stock.
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the Registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
----- -----
<PAGE>
RIMAGE CORPORATION
FORM 10-Q
TABLE OF CONTENTS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997
DESCRIPTION PAGE
----------- ----
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets as of
September 30, 1997 (unaudited) and
December 31, 1996 ................................... 3
Consolidated Statements of Operations
(unaudited) for the Three and Nine Months
Ended September 30, 1997 and 1996 ................... 4
Consolidated Statements of Cash Flows
(unaudited) for the Nine Months
Ended September 30, 1997 and 1996 ................... 5
Condensed Notes to Consolidated
Financial Statements (unaudited) ................... 6-7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ....... 8-12
PART II OTHER INFORMATION .......................................... 13
Items 1-5. None
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES ........................................................... 14
-2-
<PAGE>
RIMAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS September 30, December 31,
1997 1996
------------- ------------
Current assets: (unaudited)
Cash ......................................... $ 12,850 $ 117,322
Trade accounts receivable, net of allowance
for doubtful accounts and sales returns of
$571,860 and $1,084,910 respectively ....... 4,522,310 5,070,738
Inventories (note 2) ......................... 2,730,941 4,027,553
Income tax receivable......................... 24,711 818,790
Prepaid expenses and other current assets..... 393,675 293,037
Current installments of investment
in sales-type leases ....................... 125,420 217,952
----------- -----------
Total current assets ..................... 7,809,907 10,545,392
----------- -----------
Property, plant, and equipment, net............. 6,235,325 7,814,430
Investment in sales-type leases, net of
current installments ......................... 21,592 182,332
Goodwill ....................................... 868,870 929,407
Other assets ................................... 354,541 537,944
----------- -----------
Total assets ............................. $15,290,235 $20,009,505
----------- -----------
----------- -----------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of notes payable ............. $ 2,865,113 $6,052,709
Current installments of capital lease
obligations ................................ 341,548 311,343
Trade accounts payable ....................... 2,566,435 4,295,400
Accrued expenses ............................. 1,181,524 1,746,912
Deferred income and customer deposits......... 550,242 429,822
----------- -----------
Total current liabilities ................... 7,504,862 12,836,186
Capital lease obligations, less
current installments ......................... 2,755,526 3,031,759
----------- -----------
Total liabilities .......................... 10,260,388 15,867,945
----------- -----------
Minority interest in inactive subsidiary ....... 57,907 57,907
Stockholders' equity (note 4):
Common stock ................................. 30,898 30,845
Additional paid-in capital ................... 10,463,750 10,447,798
Accumulated deficit (note 4) ................. (5,382,776) (6,330,291)
Equity adjustment from foreign currency
translation ................................ (139,932) (64,699)
----------- -----------
Total stockholders' equity ................ 4,971,940 4,083,653
----------- -----------
Total liabilities and stockholders' equity .. $15,290,235 $20,009,505
----------- -----------
----------- -----------
See accompanying condensed notes to consolidated financial statements
-3-
<PAGE>
RIMAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues............................................ $8,443,604 $12,121,699 $29,608,308 $33,072,107
Cost of revenues.................................... 5,758,059 9,333,752 21,460,335 24,941,683
---------- ----------- ----------- -----------
Gross Profit.................................. 2,685,545 2,787,947 8,147,973 8,130,424
Operating expenses:
Engineering and development...................... 425,862 587,113 1,510,529 2,054,242
Selling, general and administrative.............. 1,606,179 2,058,406 5,044,491 6,539,688
---------- ----------- ----------- -----------
Total operating expenses...................... 2,032,041 2,645,519 6,555,020 8,593,930
---------- ----------- ----------- -----------
Operating earnings (loss)..................... 653,504 142,428 1,592,953 (463,506)
---------- ----------- ----------- -----------
Other income (expense)
Interest expense, net............................ (183,863) (167,603) (695,928) (439,097)
Gain (loss) on currency exchange................. (10,562) 38,942 28,178 27,335
Other, net....................................... 97,213 23,318 112,312 62,469
---------- ----------- ----------- -----------
Total other expense, net...................... (97,212) (105,343) (555,438) (349,293)
---------- ----------- ----------- -----------
Net earnings (loss) before income taxes....... 556,292 37,085 1,037,515 (812,799)
Income taxes.................................. 29,857 - 90,000 -
---------- ----------- ----------- -----------
Net earnings (loss).......................... $ 526,435 $ 37,085 $ 947,515 $(812,799)
---------- ----------- ----------- -----------
---------- ----------- ----------- -----------
Net earnings (loss) per common
and common equivalent share................. $ 0.15 $ 0.01 $ 0.29 $ (0.26)
---------- ----------- ----------- -----------
---------- ----------- ----------- -----------
Weighted average shares and share
equivalents outstanding..................... 3,386,563 3,118,432 3,313,970 3,107,427
---------- ----------- ----------- -----------
---------- ----------- ----------- -----------
</TABLE>
See accompanying condensed notes to the consolidated financial statements
-4-
<PAGE>
RIMAGE CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1997 1996
---------- -----------
<S> <C> <C>
Cash flows from operating activities:.............................
Net income (loss) ........................................... $ 947,515 $ (812,799)
Adjustments to reconcile net income (loss) to net cash.......
provided by operating activities:
Depreciation and amortization........................... 1,835,988 1,120,775
Change in reserve for excess and obsolete inventories... 21,787 (110,000)
Change in reserve for doubtful accounts................. (513,050) (124,744)
Loss (gain) on sale of property, plant, and equipment... 74,783 (3,469)
Deferred income tax..................................... 0 (123,388)
Increase in investment in sales-type leases............. 0 (73,452)
Changes in operating assets and liabilities:
Trade accounts receivable............................... 1,061,478 1,272,352
Inventories............................................. 1,274,825 (18,524)
Prepaid expenses and other current assets............... (100,638) (91,903)
Income tax receivable................................... 794,079 6,417
Accounts payable ....................................... (1,728,965) (272,193)
Accrued expenses ....................................... (565,388) 163,838
Deferred income and customer deposits................... 120,420 (291,608)
------------ -----------
Net cash provided by operating activities .............. 3,222,834 641,302
------------ -----------
Cash flows from investing activities:
Purchase of property, plant, and equipment................... (287,129) (5,160,376)
Proceeds from the sale of property and equipment............. 16,000 20,650
Other assets................................................. 183,403 259,575
Payments on investment in sales-type leases ................. 253,272 205,893
------------ -----------
Net cash provided by (used in) investing activities..... 165,546 (4,674,258)
------------ -----------
Cash flows from financing activities:
Proceeds from capital lease equipment financing ............. 0 1,822,770
Proceeds from stock option exercise ......................... 16,005 146,250
Principal payments on capital lease obligation............... (246,028) (16,603)
Proceeds from other notes payable ........................... 26,001,642 13,993,300
Repayment of other notes payable............................. (29,189,238) (12,066,041)
------------ -----------
Net cash provided by (used in) financing activities..... (3,417,619) 3,879,676
------------ -----------
Effect of exchange rate changes on cash........................... (75,233) (52,022)
------------ -----------
Net decrease in cash ............................................. (104,472) (205,302)
Cash, beginning of period......................................... 117,322 230,014
------------ -----------
Cash, end of period............................................... $ 12,850 $ 24,712
------------ -----------
------------ -----------
</TABLE>
See accompanying condensed notes to the consolidated financial statements.
-5-
<PAGE>
RIMAGE CORPORATION AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(1) BASIS OF PRESENTATION AND NATURE OF BUSINESS
The Company operates in two segments, Rimage Systems Division and Rimage
Services Division. The Rimage Systems Division consists of substantially
all of the former Rimage Companies. The Rimage Services Division consists
of the former Dunhill operation in addition to the existing service
business at Duplication Technology.
The Systems Division develops, manufactures and distributes high
performance CD-Recordable (CD-R) publishing and duplication systems, and
continues to support its long term involvement in diskette duplication
and publishing equipment. The Services Division provides computer media
duplication and production services to software developers and
manufacturers and information publishers.
The consolidated financial statements included herein have been prepared
by the Company, without audit, pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in
accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations, although
Rimage believes that the disclosures are adequate to make the information
presented not misleading.
In the opinion of the Company, all adjustments, consisting of only
normal recurring adjustments, necessary to present fairly the
consolidated financial position of the Company as of the dates and for
the periods presented, have been made. The results of operations for
such interim periods are not necessarily indicative of the results to be
expected for the entire year.
(2) INVENTORIES
Inventories consist of the following:
September 30, December 31,
1997 1996
- --------------------------------------------------------------------------------
(unaudited)
Finished goods and demonstration equipment $ 903,077 $ 1,026,303
Work-in-process 315,441 527,378
Purchased parts and subassemblies 2,124,210 3,063,872
- --------------------------------------------------------------------------------
3,342,728 4,617,553
Less reserve for excess inventories 611,787 590,000
- --------------------------------------------------------------------------------
$ 2,730,941 $ 4,027,553
- --------------------------------------------------------------------------------
-6- (continued)
<PAGE>
RIMAGE CORPORATION AND SUBSIDIARIES
CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(3) SEGMENT REPORTING
The following table summarizes certain financial information for the
Systems and Service segments:
Nine Months Ended September 30,
(unaudited)
-----------------------------------
(in thousands) 1997 1996
- --------------------------------------------------------------------------------
Revenues from unaffiliated customers:
Systems $ 15,428 $ 18,524
Service 14,180 14,548
Operating earnings (loss):
Systems 2,125 (473)
Service (532) 9
September 30, December 31,
1997 1996
------------- ------------
Net identifiable assets: (unaudited)
Systems $ 7,371 $ 9,137
Service 7,919 10,873
As of and for the nine months ended September 30, 1997, revenues from
unaffiliated customers, operating loss, and net identifiable assets from
foreign operations were $3,157,000, $(178,000) and $1,753,000,
respectively. As of and for the nine months ended September 30, 1996,
foreign revenues from unaffiliated customers, operating loss, and net
identifiable assets were $3,803,000, $(9,000) and $2,169,000,
respectively.
-7-
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The following table sets forth, for the periods indicated, selected items
from the Company's consolidated statements of operations, shown in
thousands.
Three Months Ended Nine Months Ended
September 30, September 30,
------------------ -----------------
1997 1996 1997 1996
------- ------- ------- -------
Revenues from Unaffiliated Customers:
Systems............................. $4,881 $7,562 $15,428 $18,524
Services ........................... 3,563 4,560 14,180 14,548
------- ------- ------- -------
Total Revenues ................. 8,444 12,122 29,608 33,072
Cost of Revenues:
Systems............................. 2,670 5,555 8,931 12,605
Service............................. 3,088 3,779 12,529 12,337
------- ------- ------- -------
Total Cost of Revenues ......... 5,758 9,334 21,460 24,942
Gross Profit:
Systems............................. 2,211 2,007 6,497 5,919
Service............................. 475 781 1,651 2,211
------- ------- ------- -------
Total Gross Profit ............. 2,686 2,788 8,148 8,130
Operating Expenses:
Systems ........................... 1,314 1,903 4,372 6,392
Service ........................... 718 743 2,183 2,202
------- ------- ------- -------
Total Operating Expenses....... 2,032 2,646 6,555 8,594
Operating Earnings (Loss):
Systems ........................... 898 104 2,125 (473)
Service ........................... (244) 38 (532) 9
------- ------- ------- -------
Total Operating Earnings (Loss)..... $654 $142 $1,593 $(464)
------- ------- ------- -------
------- ------- ------- -------
-8-
<PAGE>
RESULTS OF OPERATIONS
This report contains forward-looking statements that involve risks and
uncertainties. The Company's actual results could differ
significantly from those discussed in the forward-looking statements.
Factors that could cause or contribute to such differences include,
but are not limited to, changes in media or method used for
distribution of software, technological changes in products offered
by the Company or its competitors and changes in general conditions
in the computer market.
Rimage has two primary divisions, as follows: 1) The Systems Division
that designs, manufactures and sells high performance, on-demand
publishing and duplication systems for CD-R's and diskettes and 2)
the Service Division that provides media duplication and fulfillment
services for most computer media types, including diskette, CD ROM,
tape and other media such as Zip and Jazz disks. The Company's
revenues decreased by 30.3% and 10.5% in the three and nine months
ended September 30, 1997, respectively, when compared to the three
and nine months ended September 30, 1996. Consolidated net earnings
for the three and nine months ended September 30, 1997 were $526,000
and $948,000 respectively, compared to net earnings of $37,000 and a
net loss of $(813,000), respectively, for the three and nine months
ended September 30, 1996.
SYSTEMS DIVISION -- THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
Systems Division revenues (which include equipment sold from Rimage
Systems Group, Rimage Europe, Duplication Technology, and Knowledge
Access International) for the three and nine months ended September
30, 1997 decreased by $2,681,000 and $3,096,000, respectively, when
compared to the same periods of 1996. These decreases were primarily
due to significant decreases in non-core business revenues of
$3,314,000 and $5,332,000, respectively, after the shut-down of
certain non-core business operations in December of 1996 and May of
1997, offset by significant increases in core business system
revenues of $633,000 and $2,236,000, respectively. The increase in
core business revenues was primarily due to an increase in CD-R
equipment sales.
Systems Division gross profit for the three and nine months ended
September 30, 1997, increased by $205,000 and $578,000, or 18.8% and
10.2% as a percentage of sales, respectively, when compared to the
same periods of 1996. These increases were primarily due to the
increased sales of higher margin CD-R products and the
discontinuation of lower margin products as a result of the shut-down
of non-core business operations.
Systems Division operating expenses for the three and nine months
ended September 30, 1997 decreased by $589,000 and $2,020,000, or
30.9% and 31.6%, respectively, when compared to operating expenses
for the same period of 1996. These decreases were primarily a result
of work force changes and the decision to shut-down certain non-core
business facilities and divisions in December of 1996 and May 1997.
The Company expects this trend of comparative lower operating
expenses to continue through the end of 1997.
-9-
<PAGE>
Systems Division operating earnings for the three and nine months ended
September 30, 1997 were $898,000 and $2,125,000, respectively,
compared with operating earnings of $104,000 and an operating loss of
$473,000, respectively, for the same periods of 1996. These
improvements were due to the aforementioned change in sales mix and
decreases in operating expenses during the three and nine months
ended September 30, 1997 compared to the same periods of 1996.
SERVICE DIVISION -- THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
Service Division revenues (which include the revenues of the Rimage
Service Group, formerly "Dunhill", as well as the service business of
Duplication Technology) for the three and nine months ended September
30, 1997, decreased by $997,000 and $368,000, respectively, when
compared to the same periods of 1996. These decreases were primarily
due to lower diskette duplication demand offset by incremental CD-ROM
duplication from the Company's CD-ROM stamping facility. The Company
anticipate moving CD-ROM equipment from this facility during the
fourth quarter 1997 for which $200,000 has been reserved during the
third quarter 1997 to account for the predicted costs.
Service Division gross profit as a percentage of revenues for the
three and nine months ended September 30, 1997, decreased to 13.3%
and 11.6% from 17.1% and 15.2%, respectively, when compared to the
same periods of 1996. These margin changes were primarily due to a
lower gross profit from the aforementioned incremental CD-ROM
duplication offset by personnel and manufacturing operation changes
that were made during the second and third quarters of 1997 to
improve those margins.
Service Division operating expenses for the three and nine months
ended September 30, 1997 were $718,000 and $2,183,000, respectively,
compared to $743,000 and $2,202,000, respectively, for the same
periods of 1996. Both the three and nine month periods of 1997
contain $200,000 of reserve expense to cover the costs of moving
CD-ROM equipment, as mentioned in the paragraph above. The decreases
of operating expenses from the three and nine month periods of 1997
to 1996 were a direct result of work force changes made in December
1996.
Service Division operating loss for the three and nine months ended
September 30, 1997, was $(244,000) and $(532,000), respectively,
compared with operating earnings of $38,000 and $9,000, respectively,
for the same periods of 1996. These changes in operating
earnings/losses were primarily due to the aforementioned gross profit
changes.
CONSOLIDATED THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
Revenues for the three and nine months ended September 30, 1997,
decreased by $3,678,000 and $3,464,000, respectively, when compared
to the same periods of 1996. These decreases were primarily a result
of the shut down of non-core businesses offset by increased revenues
from the Company's core businesses.
-10-
<PAGE>
Gross profit, as a percentage of revenues, for the three and nine months
ended September 30, 1997, increased to 31.8% and 27.5%, respectively,
from 23.0% and 24.6% for the three and nine months ended September
30, 1996. These increases were primarily due to the aforementioned
sales mix change between core and non-core businesses, offset by
lower gross profit from incremental CD-ROM duplication.
Operating expenses for the three and nine months ended September 30,
1997 decreased by $614,000 and $2,039,000, respectively, when
compared to the same periods of 1996. These decreases were a direct
result of work force changes and the decision to shut-down certain
non-core business facilities and divisions in December of 1996 and
May 1997.
Other expense, net, for the three and nine months ended September 30,
1997, decreased by $8,000 and increased by $206,000, respectively,
when compared to the same periods of 1996. This was primarily due to
higher interest expense as a direct result of increased borrowing for
working capital and capital investment beginning in the second half
of 1996.
Due to significant loss carryforwards as of December 31, 1996, the
Company's income tax expense for the three and nine months ended
September 30, 1997, were $30,000 and $90,000, respectively. The
Company expects this trend to continue due to significant remaining
loss carryforwards.
Net earnings for the three and nine months ended September 30, 1997,
were $526,000 and $948,000, respectively, compared to net earnings of
$37,000 and a net loss of $(813,000), respectively, for the same
periods of 1996. Net earnings per share for the three and nine
months ended September 30, 1997, were $.15 and $.29, respectively,
compared to net earnings per share of $.01 and a net loss per share
of ($.26) for the same periods of 1996.
LIQUIDITY AND CAPITAL RESOURCES
Net cash provided by operating activities during the first nine months
of 1997 and 1996 was $3,223,000 and $641,000, respectively. The main
sources of cash provided from operating activities during the first
nine months of 1997 include: net earnings of $948,000; depreciation
and amortization expense of $1,836,000; a decrease in receivables of
$548,000 as a result of increased emphasis on the timely collection
of receivables; a decrease in inventory of $1,297,000 primarily due
to concentrated efforts to reduce excess inventories at specific
locations within the Systems and Service Divisions; offset by a
decrease in accounts payable and accrued expenses of $2,494,000
resulting from a conscious effort to reduce the Company's payable
days to approximately half of what they were at December 31, 1996.
-11-
<PAGE>
Net cash provided by (used in) investing activities was $166,000 and
$(4,674,000) during the nine months ended September 30, 1997 and
1996, respectively. The change which provided cash from investing
activities during the first nine months of 1997 was primarily due to
a focus on fewer property, plant, and equipment purchases. In third
quarter 1996, the Company purchased approximately $4,100,000 in
CD-ROM production equipment. At September 30, 1997 the Company had
no significant commitments to purchase additional capital equipment.
At September 30, 1997, the Company's working capital was $305,000
compared to $(2,290,794) at December 31, 1996. The net cash provided
by (used in) financing activities was $(3,418,000) and $3,880,000 for
the nine months ended September 30, 1997 and 1996, respectively.
The Company decreased its bank debt by approximately $3,200,000
during the first nine months of 1997. During the first nine months of
1996, the Company increased its bank debt by $1,927,000 and obtained
$1,823,000 in financing for capital leases. The Company has a
$5,000,000 line of credit with a bank, which expires April 1, 1998.
Advances under this line of credit are secured by substantially all
the Company's assets, are subject to borrowing base requirements, are
due on demand and bear interest at the bank's reference rate plus two
and one-half percent. At September 30, 1997, the Company had
borrowings under this line totaling $982,000 and availability of
$2,191,000. The Company also has a term note agreement at the same
bank with a principal balance of $1,883,000 at September 30, 1997.
The note is payable in monthly installments of $77,777, plus accrued
interest at the bank's reference rate plus two and three-quarters
percent until April 1, 1998 when the remaining principal balance and
all unpaid accrued interest is due. The note contains various terms
that are secured by substantially all the Company's assets. The
Company believes its banking relationship is good and that
satisfactory financing will be available on terms acceptable to the
Company for the foreseeable future.
NEW ACCOUNTING PRONOUNCEMENTS
Beginning in the fourth quarter of 1997, the Company will be required
to adopt the provisions of Statement of Financial Accounting
Standards No. 128 "Earnings per Share" (SFAS No. 128). Under SFAS
No. 128, companies are required to present basic and diluted earnings
per share instead of primary and fully diluted earnings per share as
required by Accounting Principles Board Opinion No. 15 "Earnings per
Share" (APB No. 15). Basic earnings per share is computed by
dividing income available to common stockholders by the weighted
average number of common shares outstanding during the period.
Diluted earnings per share is computed in the same manner as basic
earnings per share except that the weighted average number of common
shares outstanding is increased to include the number of additional
common shares that would have been outstanding if all potentially
dilutive common shares had been issued using the treasury stock
method.
-12-
<PAGE>
PART II -- OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS
Not Applicable.
Item 2. CHANGES IN SECURITIES
Not Applicable.
Item 3. DEFAULTS UPON SENIOR SECURITIES
Not Applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
Item 5. OTHER INFORMATION
Not Applicable.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit No. 11.1 Computation of Net Earnings (Loss)
Per Common and Common Equivalent Share.
Exhibit No. 27.1 Financial Data Schedule
(b) Reports on Form 8-K:
Not Applicable.
-13-
<PAGE>
SIGNATURES
In accordance with the Exchange Act, this report has been signed below by
following persons on behalf of the registrant and on the dates indicated.
RIMAGE CORPORATION
------------------
Registrant
Date: November 14, 1997 By: /s/ Bernard P. Aldrich
--------------------- ----------------------
Bernard P. Aldrich
Director, Chief Executive Officer,
and President
(Principal Executive Officer)
(Principal Financial Officer)
Date: November 14, 1997 By: /s/ Robert M. Wolf
--------------------- ------------------
Robert M. Wolf
Controller
(Principal Accounting Officer)
-14-
<PAGE>
EXHIBIT 11
RIMAGE CORPORATION
COMPUTATION OF NET EARNINGS (LOSS) PER COMMON AND COMMON EQUIVALENT SHARE
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Shares Outstanding at
beginning of period. . . . . . . . . . 3,084,500 3,084,500 3,084,500 3,051,000
Common stock issued in stock
option exercise . . . . . . . . . . 5335 0 5335 33500
Shares Outstanding at
end of period . . . . . . . . . . . 3,089,835 3,084,500 3,089,835 3,084,500
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average shares
of common stock outstanding . . . . 3,089,835 3,084,500 3,089,835 3,071,505
--------- --------- --------- ---------
--------- --------- --------- ---------
Common stock equivalents . . . . . . . . 760,488 397,453 760,488 397,453
Weighted average shares of
common stock equivalents. . . . . . 296,728 33,932 224,135 35,921
--------- --------- --------- ---------
--------- --------- --------- ---------
Weighted average shares of
common stock and
stock equivalents . . . . . . . . . . 3,386,563 3,118,432 3,313,970 3,107,427
--------- --------- --------- ---------
--------- --------- --------- ---------
Net earnings (loss). . . . . . . . . . . $526,435 $37,085 $947,515 $(812,799)
--------- --------- --------- ---------
--------- --------- --------- ---------
Net earnings (loss) per share . . . . $ 0.15 $ 0.01 $0.29 $ (0.26)
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
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