On Feb. 14, digital music service provider RealNetworks
- The figures below exclude Microsoft's
(NASDAQ:MSFT) litigation settlement payments, which totaled $60.9 million this quarter and $434.4 million last year. Putting those amounts back in, RealNetworks made a $0.22 profit per share, but it's hardly a fair measure of sustainable income levels. - With that distortion removed, you can see that RealNetworks is doing much better than it used to. It's not far from turning profitable without help from the legal system, and there's already plenty of cash flow.
- The drastic increases in accounts payable and receivable point to business picking up, as well. The company is receiving more orders for its services, and in turn goes out and buys more stuff from its suppliers.
(Figures in millions, except per-share data)
Income Statement Highlights
|
Q4 2006 |
Q4 2005 |
Change |
|
|---|---|---|---|
|
Sales |
$125.6 |
$83.6 |
50.3% |
|
Net Profit |
($21.6) |
($138.8) |
84.5% |
|
EPS |
($0.12) |
($0.76) |
84.2% |
|
Diluted Shares |
180.9 |
183.7 |
(1.5%) |
Get back to basics with a look at the income statement.
Margin Checkup
|
Q4 2006 |
Q4 2005 |
Change* |
|
|---|---|---|---|
|
Gross Margin |
66.3% |
71.3% |
(5.0) |
|
Operating Margin |
(7.0%) |
(38.3%) |
31.4 |
|
Net Margin |
(17.2%) |
(166.1%) |
148.9 |
*Expressed in percentage points
Margins are the earnings engine. See how they work.
Management Effectiveness
|
Q4 2006 |
Q4 2005 |
Change* |
|
|---|---|---|---|
|
Return on Assets |
(7.1%) |
(64.3%) |
(57.2) |
|
Return on Equity |
(9.3%) |
(90.2%) |
(80.9) |
*Expressed in percentage points
See how management puts its financial tools to work.
Balance Sheet Highlights
|
Assets |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Cash + ST Invest. |
$678.9 |
$781.3 |
(13.1%) |
|
Accounts Rec. |
$65.8 |
$16.7 |
293.2% |
|
Liabilities |
Q4 2006 |
Q4 2005 |
Change |
|---|---|---|---|
|
Accounts Payable |
$52.1 |
$11.4 |
357.1% |
|
Long-Term Debt |
$100.0 |
$100.0 |
0.0% |
Learn the ways of the balance sheet.
Cash Flow Highlights
|
Q4 2006 |
Q4 2005 |
Change |
|
|---|---|---|---|
|
Cash From Ops. |
$69.8 |
$12.4 |
463.7% |
|
Capital Expenditures |
$4.5 |
$3.1 |
47.6% |
|
Free Cash Flow |
$65.3 |
$9.3 |
599.8% |
|
($17.6) |
($137.5) |
87.2% |
Find out why Fools always follow the money.
Related companies:
-
Apple
(NASDAQ:AAPL) - Microsoft
-
Yahoo!
(NASDAQ:YHOO) -
Google
(NASDAQ:GOOG) -
Dolby Labs
(NYSE:DLB) -
Audible
(NASDAQ:ADBL)
Related Foolishness:
- I Love Dolby Labs
- Foolish Forecast: Keeping It Real With RealNetworks
- Date Yahoo!, Marry Google, Kill Microsoft
- Foolish Fundamentals: GAAP
Yahoo! and Dolby Laboratories are two of our Motley Fool Stock Advisor recommendations, and Microsoft is an Inside Value pick. Need new ideas for your money? Talk stocks with other investors and our analysts when you give our newsletters a try.
Fool by Numbers is designed to give you the raw earnings information in a timely fashion, putting all the numbers you need in one easy-to-read place. But at The Motley Fool, we believe numbers tell only part of the story, so check Fool.com for more of our in-depth discussion of what the numbers mean.
At the time of publication, Fool contributor Anders Bylund had no position in any company mentioned. Fool rules are here.
