EX-99.1 2 exh991.htm PRESS RELEASE

Exhibit 99.1

[exh991001.jpg]

NEWS RELEASE

For release at 4:00 p.m. EDT, 4/19/10

Contact:  Susan Sutherland

Toll free ofc. (877) 988-8048

Fax: (715) 424-3414

Email: pr@renlearn.com


2911 Peach Street • P.O. Box 8036 • Wisconsin Rapids, WI 54495-8036




Renaissance Learning, Inc. Announces First Quarter, 2010 Results

WISCONSIN RAPIDS, WI — April 19, 2010 — Renaissance Learning, Inc. (Nasdaq: RLRN), a leading provider of technology to support personalized practice, differentiated instruction, and progress monitoring in reading, math, and writing for pre-K-12 schools and districts, today announced financial results for the quarter ended March 31, 2010. Revenues for the first quarter of 2010 were $32.2 million, an increase of 11.6% from first quarter 2009 revenues of $28.9 million. Net income was $5.8 million, or $0.20 per share, an increase of 48% from first quarter 2009 income of $3.9 million or $0.13 per share for the first quarter last year. First quarter 2010 net income included a tax benefit resulting from an audit settlement with the state of Wisconsin of $1.1 million, or $0.04 per share.  


“We are pleased to report strong financial results again this quarter,” commented Terrance D. Paul, Chief Executive Officer.  “In addition to good revenue and income growth, cash flow was strong and first quarter orders grew by 23%.  While order growth benefited from one large district order this quarter, even without that order, the underlying order growth rate was strong at about 9%.  


“Other key metrics continued their momentum as well.  We added more than 700 Accelerated Reader Enterprise schools in the quarter and the recent price decrease for our hardware products helped us achieve good unit growth,” continued Paul.  “While we are pleased with these results, we remain cautious about the weak state revenue situation and its implications on school funding for the 2011 and 2012 school years.”


Renaissance Learning added approximately 500 new customer schools during the quarter, bringing total schools worldwide that are actively using the Company’s products to over 72,000. Of these, more than 31,000 are actively using at least one product running on the Renaissance Place platform.  


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The Company will hold a conference call at 5:00 p.m. EDT today to discuss its financial results, quarterly highlights, and business outlook. The teleconference may be accessed in listen-only mode by dialing 877-869-3847 at 5:00 p.m. EDT. Please call a few minutes before the scheduled start time to ensure a proper connection.


A digital recording of the conference call will be made available on April 19, 2010 at 8:00 p.m. through April 26, 2010 at 11:59 p.m. The replay dial-in is 877-660-6853. The conference account number to access the replay is 350 and replay ID number is 347801.


Renaissance Learning, Inc.


Renaissance Learning, Inc. is the world’s leading provider of computer-based assessment technology for pre-K–12 schools. Adopted by more than 72,000 schools, Renaissance Learning’s tools provide daily formative assessment and periodic progress-monitoring technology to enhance core curriculum, support differentiated instruction, and personalize practice in reading, writing and math. Renaissance Learning products help educators make the practice component of their existing curriculum more effective by providing tools to personalize practice and easily manage the daily activities for students of all levels. As a result, teachers using Renaissance Learning products accelerate learning, get more satisfaction from teaching, and help students achieve higher test scores on state and national tests. Renaissance Learning has seven U.S. locations and subsidiaries in Canada and the United Kingdom.


This press release contains forward-looking statements made pursuant to the safe harbor provision of the Private Securities Litigation Reform Act of 1995, including statements regarding management’s expectations for future periods.  These forward-looking statements are based on current expectations and various assumptions which management believes are reasonable.  However, these statements involve risks and uncertainties that could cause actual results to differ materially from any future results encompassed within the forward-looking statements.  Factors that could cause or contribute to such differences include the failure of AR and AM Enterprise and NEO orders to achieve expected growth targets, a decline in quiz sales that exceeds forecasts, risks associated with the implementation of the Company’s growth initiatives, dependence on educational institutions and government funding, our ability to successfully implement cost savings measures and achieve cost reductions, and other risks affecting the Company’s business as described in the Company’s filings with the Securities and Exchange Commission, including the Company’s 2009 Annual Report on Form 10-K and later filed quarterly reports on Form 10-Q and Current Reports on Form 8-K, which factors are incorporated herein by reference.  The Company expressly disclaims a duty to provide updates to forward-looking statements, whether as a result of new information, future events or other occurrences.


(tables to follow)


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RENAISSANCE LEARNING, INC.

CONSOLIDATED STATEMENTS OF INCOME

(dollar amounts in thousands, except per share amounts)

(unaudited)


 

Three Months

 

 Ended March 31,

 

2010

 

2009

 

 

 

 

Net sales:

 

 

 

    Products

 $        21,839

 

 $        20,661

    Services

10,384

 

8,209

        Total net sales

32,223

 

28,870

 

 

 

 

Cost of sales:

 

 

 

    Products

3,498

 

2,996

    Services

3,491

 

2,906

        Total cost of sales

6,989

 

5,902

 

 

 

 

Gross profit

25,234

 

22,968

 

 

 

 

Operating expenses:

 

 

 

    Product development

4,099

 

4,451

    Selling and marketing

10,345

 

8,921

    General and administrative

3,401

 

3,463

 

 

 

 

Total operating expenses

17,845

 

16,835

 

 

 

 

Operating income

7,389

 

6,133

 

 

 

 

Other income, net

239

 

148

 

 

 

 

Income before income taxes

    7,628

 

    6,281

 

 

 

 

Income taxes

    1,845

 

    2,374

 

 

 

 

Net income

 $          5,783

 

 $          3,907

 

 

 

 

Income per share:

 

 

 

  Basic and Diluted

 $   0.20

 

 $   0.13

 

 

 

 

Weighted average shares outstanding:

 

 

 

  Basic

29,289,258

 

29,100,186

  Diluted

29,289,865

 

29,100,186







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RENAISSANCE LEARNING, INC.

CONSOLIDATED BALANCE SHEETS

(dollar amounts in thousands)

(unaudited)


 

March 31,

 

December 31,

 

2010

 

2009

 

 

 

 

 

 

 

 

ASSETS:

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

 $     40,317

 

 $     36,207

Investment securities

       4,092

 

      3,278

Accounts receivable, net

       8,914

 

    10,535

Inventories

       3,142

 

      4,290

Prepaid expenses

       2,002

 

      1,962

Income taxes receivable

       1,584

 

      3,679

Deferred tax asset

       3,828

 

      3,827

Other current assets

          591

 

         629

  Total current assets

     64,470

 

    64,407

 

 

 

 

Investment securities

       3,010

 

      4,650

Property, plant and equipment, net

       6,741

 

      6,848

Goodwill

       2,843

 

      2,827

Other non-current assets

       4,017

 

      4,534

 

 

 

 

  Total assets

 $     81,081

 

$     83,266

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY:

 

 

 

Current liabilities:

 

 

 

Accounts payable

 $      1,410

 

 $        921

Deferred revenue

    45,306

 

    54,224

Payroll and employee benefits

     7,944

 

      5,404

Other current liabilities

       2,686

 

      2,648

  Total current liabilities

     57,346

 

    63,197

 

 

 

 

Deferred revenue  

       5,707

 

      5,262

Deferred compensation and other employee benefits

       1,971

 

      1,871

Income taxes payable

       3,765

 

      4,801

Other non-current liabilities

          147

 

         184

  Total liabilities

     68,936

 

    75,315

 

 

 

 

  Total shareholders' equity

     12,145

 

      7,951

 

 

 

 

  Total liabilities and shareholders' equity

 $     81,081

 

 $     83,266