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 user 2007-09-28 at 11:53:00 am Views: 34
  • #18812

    MSI net income down 63 percent
    September 2007 — Oakland (NJ): Media Sciences International has announced its annual financial results.
    income fell 63 percent to $0.78 million from $2.13 million a year
    earlier. Basic and fully diluted EPS were $0.07Net revenue was up six
    percent to $22.5 million, from $21.3 million a year earlier. Gross
    margin was at 54 percent of net revenues, a 300 basis point
    improvement, year-over-year.

    Michael Levin, president and
    chairman, said: “Fiscal 2007 was a year of investment and adjustment.
    We invested significantly in R&D, resulting in the fastest product
    introduction in our history. In fiscal 2007, we recognised that we were
    not meeting our revenue growth expectations. We acted swiftly, making
    sweeping changes to our sales leadership, team, and structure. While
    the changes we made adversely impacted our financial results in the
    short term, each was necessary to build a firm foundation from which
    our company can scale to realise its growth potential.”

    to the company, its results were negatively affected by pre-tax
    litigation costs of $1.18 million and a one-off charge resulting from
    reorganisation of the company’s sales and marketing efforts.These
    items, along with other costs, reduced the company’s reported net
    revenues by $0.71 million, gross profits by $0.92 million, pretax
    income by $2.77 million, net income by about $1.68 million and earnings
    per share by about $0.14 per diluted share.Levin continued: “There are
    three key initiatives for fiscal 2008. The first is to return to a
    revenue growth rate that reflects the opportunity we have in this
    market. In both the Americas and Europe we are strengthening existing
    relationships, and developing new distribution relationships,
    particularly in the office products and computer channels. We are doing
    so using the pricing and channel structure foundation put in place last
    year.”Second, we intend to better meet the needs of our European
    customers by expanding our distribution and logistics capabilities into
    Europe, and adopting regionalised pricing and local currencies,
    specifically the British Pound and the Euro.”And third, we intend to
    build our Asian based xerographic engineering and manufacturing
    capability over the course of the year to reduce toner product lead
    times (and thus inventory levels), reduce new product development time,
    and ultimately, reduce our toner product costs.”"We are making
    significant progress on each of these initiatives. Our products are now
    actively being sold by two of the largest office products dealers in
    the US and one of the largest in Europe. We expect to have our European
    logistics in place in our second fiscal quarter. And, we are building
    our team in China. While last year was a year of adjustment, we are now
    focused purely on execution and we are seeing the results.”