InFocus Report Lower Sales, Reduced Loss

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Wilsonville, Ore. — InFocus reported lower revenues and a reduced loss for its fiscal second quarter ended Sept. 30.

The operations loss was $16.7 million vs. $43.5 million for last year’s quarter, while revenues were $81.2 million, down 38 percent from last year’s second quarter, which reached $130.3 million.

Revenues were down from the second quarter in both the Americas and Europe, primarily a result of lower revenues from meeting room projectors through the PC distribution channel. InFocus said its mainstream meeting room product line transitioned during the quarter and its new 2000 lumen IN32 and 2500 lumen IN34 projectors only began shipping in mid-September.

As a result of the timing of this transition, total revenues from this product category were down significantly quarter-to-quarter. These new products are expected to be broadly available during the fourth quarter. Revenues from sales of the company’s value projectors, the IN24 and IN26, and mobile projectors, were also down during the quarter, the firm said.

Gross margins declined to 12.7 percent in the third quarter of 2006 from 15 percent in the second quarter. Overall, average selling prices were down 5 percent quarter to quarter. Projector unit shipments were approximately 74,000 units in the third quarter, down 12 percent from the prior quarter.

“While the board of directors conducts its evaluation of strategic alternatives, it is critical that the management and employees of the company stay focused on improving the operations of the business,” stated Kyle Ranson, president/CEO, InFocus. “Managing cost is one part of that equation, but it is also critical that we leverage our core strengths to grow revenues and gross margins,” he added.

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