BEAVERTON, Ore., Apr 27, 2010 (BUSINESS WIRE) --Planar Systems, Inc. (NASDAQ:PLNR), a worldwide leader in specialty display solutions, recorded sales of $39.7 million and GAAP loss per share of $0.19 in the second fiscal quarter ended March 26, 2010. On a Non-GAAP basis (see reconciliation table), loss per share was $0.09 in the second quarter of fiscal 2010.

"While it was good to see year on year growth in revenue in the second quarter, the growth was a bit lower than our expectations," said Gerry Perkel, Planar's President and Chief Executive Officer. "While we continue to see some signs that market conditions are improving, predicting the pace of that improvement is a challenge. However, we continue to work on developing new initiatives to grow our revenues as market conditions improve."

SUMMARY OF KEY FINANCIAL INFORMATION

The following information summarizes some key financial measures for the Company at the end of the second quarter of fiscal 2010:

• Tangible Net Worth of $58.8 million, representing a tangible book value of approximately $3.10 per share outstanding for the second quarter.
• Cash on hand totaled $32.4 million. The Company had no debt outstanding at the end of the quarter.
• Net working capital totaled $54.7 million.
• DSO of 52 days
• Current Ratio of 2.5 times.

SECOND QUARTER FISCAL 2010 RESULTS

Total Company sales increased 9 percent in the second quarter of 2010 compared with the same period a year ago. This increase was primarily driven by higher demand for the Company's custom digital signage, LCD video wall systems and touch products, partially offset by lower sales of high-end home and rear projection cube products. The Company believes the broader market for high-end home products continues to be affected by the macro-economic slow-down, especially as it relates to home construction, and, as such, will be slower to rebound than the Company's other end markets. Demand for rear projection cubes has been slow to recover as well. The Company believes rear projection cube sales are being negatively impacted by product technology transitions and overall market softness in the US and Europe where the Company's operations are focused.

Overall Company gross margins were 23.6 percent in the second quarter of 2010 down from 25.5 percent in the second quarter of 2009. The decrease in gross margin percent was primarily due to an unfavorable product mix resulting from lower sales of higher margin command and control room rear-projection cubes as well as lower estimates of existing inventory value as these products transition from lamp-based platforms to LED-based platforms.

Total operating expenses (on a Non-GAAP basis) increased 8 percent in the second quarter of 2010 compared with the same quarter a year ago (see reconciliation table). The Company has been making additional expenditures associated with new initiatives in product development as well as sales and marketing in an attempt to drive future revenue growth.

BUSINESS OUTLOOK

As mentioned above, the Company believes some of its end markets and demand for its product offerings are still being impacted negatively by a variety of factors. However some products and markets, specifically digital signage, custom/embedded, and touch displays, are expected to grow in the second half compared to the previous year. The Company believes that these areas will grow based on improving market conditions and as a result of completed and forecasted expenditures by the Company to better position the Company to capitalize on opportunities in these markets. As a result, the Company currently anticipates revenue in the range of $41-43 million in the third quarter of fiscal 2010 and a Non-GAAP loss between $0.05 and $0.08 per share, with similar levels of revenue and loss expected for the fourth fiscal quarter. Net cash should be in the range of $26-$28 million at the end of the fiscal year.

Results of operations and the business outlook will be discussed in a conference call today, April 27, 2010, beginning at 2:00 PM Pacific Time. The call can be heard via the Internet through a link on Planar's Web site, www.planar.com, or through numerous other investor sites, and will be available for replay until May 27, 2010. The Company intends to post on its Web site a transcript of the prepared management commentary from the conference call shortly after the conclusion of the call.

ABOUT PLANAR

Planar Systems, Inc (NASDAQ:PLNR) is a global leader of specialty display technology providing solutions for the world's most demanding environments. Hospitals, space and military programs, utility and transportation hubs, shopping centers, banks, government agencies, businesses, and home theater enthusiasts all depend on Planar to provide superior performance when image experience is of the highest importance. Founded in 1983, Planar is headquartered in Oregon, USA, with offices, manufacturing partners, and customers worldwide. For more information, visit www.planar.com.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995:This release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 relating to Planar's business operations and prospects, including statements relating to the Company's expected levels of revenue, Non-GAAP income / loss, and EBITDA for the third quarter of fiscal 2010 and the other statements made under the heading "Business Outlook,". These statements are made pursuant to the safe harbor provisions of the federal securities laws. These and other forward-looking statements, which may be identified by the inclusion of words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," "estimates," "goal" and variations of such words and other similar expressions, are based on current expectations, estimates, assumptions and projections that are subject to change, and actual results may differ materially from the forward-looking statements. These statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. Many factors, including the following, could cause actual results to differ materially from the forward-looking statements: poor or further weakened domestic and international business and economic conditions; changes or continued reductions in the demand for products in the various display markets served by the Company; any delay in the timing of customer orders or the Company's ability to ship product upon receipt of a customer order; any inability to reduce costs or to do so quickly enough, in either case, in response to unanticipated reductions in revenue; adverse impacts on the Company or its operations relating to or arising from difficulties in obtaining necessary financing; changes in the flat-panel monitor industry; changes in customer demand or ordering patterns; changes in the competitive environment including pricing pressures or the ability to keep pace with technological changes; technological advances; shortages of manufacturing capacity from the Company's third-party manufacturing partners or other interruptions in the supply of components the Company incorporates in its finished goods; final settlement of various contractual liabilities; future production variables impacting excess inventory and other risk factors listed from time to time in the Company's periodic filings with the Securities and Exchange Commission (SEC). The forward-looking statements contained in this press release speak only as of the date on which they are made, and the Company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this press release.

Note Regarding the Use of Non-GAAP Financial Measures:

In addition to disclosing financial results calculated in accordance with U.S. generally accepted accounting principles (GAAP), the Company's earnings release contains Non-GAAP financial measures that exclude share-based compensation and the requirements of Topic 718 of the FASB Accounting Standards Codification^TM, "Compensation-Stock Compensation". The Non-GAAP financial measures also exclude impairment and restructuring charges, the amortization of intangible assets related to previous acquisitions, various tax charges including the valuation allowance against deferred tax assets and excludes the gain or loss on foreign currency due to the non-cash nature of the charge, and various other adjustments. The Non-GAAP financial measures disclosed by the Company should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and the financial results calculated in accordance with GAAP and reconciliations to those financial statements should be carefully evaluated. The Non-GAAP financial measures used by the Company may be calculated differently from, and therefore may not be comparable to, similarly titled measures used by other companies. The Company has provided reconciliations of the Non-GAAP financial measures to the most directly comparable GAAP financial measures.