DRI Corporation Posts Fiscal Year 2009 Results

 David L. Turney, the Company's Chairman and Chief Executive Officer, said: "The Company's fiscal year 2009 had a positive outcome despite delays in orders in fourth quarter 2009. Thanks in substantial part to our expanding international market position and the acquisition of our Mobitec Brazil Ltda subsidiary in Caxias do Sul, Brazil, our earnings grew to 13 cents per diluted share as compared to 10 cents per diluted share for fiscal year 2008. We are positioned to achieve significant improvements in fiscal year 2010, even while navigating the difficult slowdown in the global economic environment."

On April 15, 2010, the Company filed with the U.S. Securities and Exchange Commission (SEC) its Annual Report on Form 10-K for the period ended Dec. 31, 2009. 

Fourth quarter 2009 results

For the quarter ended Dec. 31, 2009, revenues were $26.0 million and the net profit applicable to common shareholders was $743 thousand, or 6 cents per diluted share. This compares to revenues of $15.6 million and a net loss applicable to common shareholders of $501 thousand, or 4 cents per diluted share, for the same period last year.

Basic and diluted weighted-average shares outstanding for fourth quarter 2009 were 11.7 million and 13.6 million, respectively, as compared to 11.5 million and 11.5 million, respectively, for the same period in fiscal year 2008. 

Fiscal year 2009 results

For the fiscal year ended Dec. 31, 2009, revenues were $82.3 million, as compared to revenues of $70.6 million for the same period a year ago. The full year net income applicable to common shareholders was $1.5 million, or 13 cents per basic and diluted share. This compares to a net profit of $1.2 million, or 11 cents per basic share and 10 cents per diluted share, for the same period a year ago.

Basic and diluted weighted-average shares outstanding for the fiscal year ended Dec. 31, 2009, were 11.5 million and 11.7 million, respectively, as compared to 11.3 million and 11.5 million, respectively, for the same period a year ago.

Mr. Turney said: "In November 2009, we said that we expected fiscal year 2009 revenues to approximate $82 million, based on currency exchange rates currently in effect; we posted $82.3 million in revenues for the year. We also made some progress in earnings coming in somewhat above the revised guidance of November 2009. Looking back over the last year and taking into consideration the plans we set in motion several years ago, I continue to believe that we've made the right decisions in emphasizing international business growth, as well as global margin improvements and cost reductions. Today, our international business has grown to approximately 59 percent of our total corporate revenues. Along the way, as we have grown internationally, we've encountered wide swings in currency exchange rates and, at times, stress related to our earnings and working capital. Despite such, our continuing year-over-year earnings improvements reflect success in our ongoing efforts to further increase shareholder value." 

Order flow

Mr. Turney said: "We are fortunate to be in the global surface transportation market. Simply stated, people need mobility in both good times and bad times. The global economic slowdown's impact on our domestic and international served markets, as previously reported, has been confined to certain specific market sectors as opposed to being across all or even most served market sectors. Long-term market drivers for the global transit industry include traffic gridlock, environmental issues, quality of life, mobility, economic issues, and the need to provide safe and secure transportation systems points of worldwide concern that tend to be with us everywhere each day of the year.

"In the domestic market, we presently have some concern about the latter part of fiscal year 2010 and first half of fiscal year 2011. The U.S. transit market may ultimately be impacted by the inability of the U.S. Congress and the Obama administration to pass replacement legislation for the now expired Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU) legislation. Although SAFETEA-LU has been extended to Dec. 31, 2010, the uncertainty over the lack of passage of new, long-term (six-year) legislation potentially may have a slight impact on the Company after second quarter 2010. We are focused on offsetting this, if it materializes, through international market opportunities.

"In fiscal year 2009, the Company's international operations witnessed some significant customer procurement plan revisions, including rescheduling of delivery dates and some scale-back that we believe, in the rescheduling context, may have been partially related to the economic slowdown in certain specific international market sectors. However, those specific instances of possible economic-related slowdown have since recovered. To a large extent, the delays and related revenue-reduction pressure, which tended to impact higher margin business, was replaced by revenues in lower margin international market sectors where growth accelerated. Overall, our international business continued to grow in revenue and profits in fiscal year 2009; our forecast indicates it will likely do the same in fiscal year 2010, although we are not yet totally certain as to exactly when the full extent of the orders delayed from last year will fully roll out this year." 

Backlog

"The Company's backlog was $26.3 million at Dec. 31, 2009, as compared to $9.9 million at Dec. 31, 2008. The difference here can primarily be attributed to growth in the international market," Mr. Turney said. 

Outlook

Mr. Turney said: "In November 2009, when we announced our third quarter results, we said that we would further study our preliminary fiscal year 2010 earnings outlook and comment when filing our fiscal year 2009 results. Based on current exchange rates, we continue to expect that fiscal year 2010 revenue will approximate $100 million, which represents growth of more than 20 percent over fiscal year 2009. Even while taking into consideration the domestic market's possible federal legislation-induced slowdown during the last half of the year and the unfolding effect of our rapid acceleration in high-growth market sectors we believe that we should now express our earnings outlook in the range of 22 cents to 26 cents. As the year progresses, we will fine-tune that range.

"Further, we expect revenues for first quarter 2010 to exceed the revenues of first quarter 2009. We also expect to see bottom-line results similar or favorable to first quarter 2009 results. This is due, in part, to the accelerated growth of lower-margin business filling in for higher-margin business in first quarter 2010. However, we do expect to see more recovery of higher-margin business in subsequent quarters as fiscal year 2010 unfolds.

"Additionally, our revenue run rate projections for the end of fiscal year 2012 remain at approximately $140 million, based on current exchange rates; this represents a 69 percent increase over actual fiscal year 2009 revenues and a 40 percent increase over projected fiscal year 2010 revenues. As demonstrated in recent news releases, we have already taken some organizational steps toward configuring for continued growth. We will be intensely focused in that direction throughout fiscal year 2010." 

About the company

DRI Corporation is a digital communications technology leader in the global surface transportation and transit security markets. Our products include: TwinVision and Mobitec electronic destination sign systems, Talking Bus voice announcement systems, Digital Recorders Internet-based passenger information and automatic vehicle location/monitoring systems, and VacTell video actionable intelligence systems. Our products help increase the mobility, flow, safety, and security of people who rely upon transportation infrastructure around the globe. Using proprietary hardware and software applications, our products provide easy-to-understand, real-time information that assists users and operators of transit bus and rail vehicles in locating, identifying, boarding, tracking, scheduling, and managing those vehicles. Our products also aid transit vehicle operators in their quest to increase ridership and reduce fuel consumption, as well as to identify and mitigate security risks on transit vehicles. Positioned not only to serve and address mobility, energy conservation, and environmental concerns, our products also serve the growing U.S. Homeland Security market.