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News & Events

Imation Partners with Vista Networking Solutions and SoleraTec to Ship New Network Video Recorder Embedded with RDX™ Technology

VNS V7500 Series NVRs deliver affordable, longer-term video surveillance retention with removable, trackable drives

OAKDALE, Minn.--(BUSINESS WIRE)--May 28, 2015-- Imation (NYSE:IMN), a global data storage and information security company, today announced it has partnered with Vista Networking Solutions (VNS), provider of innovative network video recorder storage devices, to engineer and bring to market a scalable and unique network video recorder (NVR) storage solution. By integrating removable and rugged RDX hard drive cartridges from Imation with SoleraTec’s innovative and modular Phoenix RSM video surveillance software, organizations now can deploy a solution purpose-built for medium and long-term video surveillance storage and maximize the security of their high-value data.

The scalability, flexibility and operational cost savings of using integrated multi-tiered storage platforms and multi-stream IP cameras provide a more affordable and easier to manage video surveillance retention solution. These solutions also are capable of retaining and managing video surveillance over several years instead of just days or weeks. Users can choose low-resolution video settings on primary or secondary storage and keep the RDX cartridges on the shelf where they consume no electricity to further improve the total cost of ownership for video surveillance retention.

“We are seeing market forces and company requirements push the retention periods for video surveillance storage, and RDX technology delivers the ease-of-use and peace-of-mind businesses need today,” said Michael Mader, executive director of the Global Commercial Tape and RDX business at Imation. “Video surveillance is an excellent market to showcase the removability, capacity and affordable costs of RDX technology.”

Imation, with its RDX platform, provides a complete portfolio of purpose-built storage solutions enabling users to deploy the right storage products for the right application. Like with tape cartridges, RDX removable hard drive cartridges can be rotated through a long-term plan allowing re-use after the retention period has been exceeded. Alternatively, users may elect to retain video permanently by using new cartridges at each retention point.

“The VNS network video recorders with removable RDX storage technology provide an excellent way for business owners to implement video surveillance and retain the video as long as they wish,” said Mark Armstrong, CEO of SoleraTec. “The RDX removable cartridge is an excellent video storage platform, and we are delighted to be partnering with VNS and Imation on this solution.”

RDX media-based removable storage offers rugged, reliable and convenient storage for all kinds of data assets, especially video assets. It provides enterprise performance and fast access, with transfer rates of up to 648GB/hr and capacities currently up to 2TB per cartridge. This delivers an ideal video storage solution for today’s mid-size businesses needing extra video retention periods.

“The design and deployment of these specific system solutions optimized for RDX removable media allows our customers to choose a long-term retention policy that is right for them,” said Graham Joys, president of Vista Networking Solutions. “The flexibility to lay down low resolution or high resolution video streams to the RDX cartridges and add RDX cartridges over time provides a truly unique solution where customers can store video for a few months or a few years depending on their liability concerns.”

About Vista Networking Solutions
IP Video Architects addressing the unique requirements of next generation surveillance systems by applying leading-edge computer and networking technologies to produce advanced video surveillance products. From embedded to enterprise, VNS has a solution to meet any surveillance need. More information can be found on the company's website: www.vnssystems.com.

About SoleraTec
SoleraTec is a leading developer of archive, storage and video lifecycle management products. SoleraTec leverages a heritage of over 15 years to deliver quality, innovation and technological advancement that has established it as one of the premier data protection solution providers in the industry. SoleraTec works through OEMs, dealers and system integrators to deliver complete video asset protection solutions. The company was established in 1997 by a team of industry veterans with experience deploying data protection, HSM and storage lifecycle management solutions to some of the largest companies around the world. For more information, please visit www.SoleraTec.com.

About Imation
Imation (NYSE: IMN) is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan™ high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey™ mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation, Memorex and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Follow @Nexsan on Twitter.

Imation, the Imation logo, Nexsan, IronKey and Memorex are trademarks of Imation Corp. TDK Life on Record is a trademark of TDK Corporation and is used under license. RDX is a registered trademark of Tandberg Data. All other trademarks are property of their respective owners.

Source: Imation Corp.

For Imation Corp.
Jason Sprenger, 612-327-1886
jsprenger@gamechangercommunications.com

BC REGIONAL VMUG USERCON

Wednesday, June 17, 2015 - Vancouver Convention Centre

Imation Announces Preliminary Results of Annual Meeting of Shareholders

OAKDALE, Minn.--(BUSINESS WIRE)--May 20, 2015-- Imation (NYSE:IMN) (the “Company”), a global data storage and information security company, today announced that, based on the preliminary vote count provided by its proxy solicitor following the Company's 2015 Annual Meeting (“Annual Meeting”), shareholders have voted to elect to the Board of Directors (the “Board”) the three nominees proposed by Clinton Group, Inc. (“Clinton”): Joseph A. De Perio, Robert B. Fernander and Barry L. Kasoff. These three individuals will replace outgoing Directors Mark E. Lucas, L. White Matthews, III and David B. Stevens.

Imation’s Chief Executive Officer, Mark Lucas, commented, “We thank all of our shareholders for their participation throughout this process. We look forward to working collaboratively with our new and existing directors to maximize shareholder value for all shareholders, including completing the fulsome review of strategic alternatives.”

Speaking on behalf of Imation’s outgoing directors, L. White Matthews, III, the Non-Executive Chairman of Imation’s Board, said, “We are proud to have served on the Imation Board and to have helped the Company with its evolution into a leading provider of enterprise and commercial data storage and security solutions. We are confident the reconstituted Board and management will continue to build upon this progress and position Imation for a bright future. On behalf of the outgoing Directors, it has been our privilege to serve our fellow shareholders.”

Mr. Lucas continued, “White and David have shown outstanding leadership and dedication to Imation and I thank them on behalf of all our shareholders for their service to the Company over the years.”

Imation noted that the preliminary vote count following the Annual Meeting also indicates that shareholders voted Against the nonbinding advisory vote on the Company's executive compensation and For the ratification of the appointment of PricewaterhouseCoopers LLP as the Company’s independent registered public accounting firm for the fiscal year 2015.

About Imation

Imation (NYSE:IMN) is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey™ mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation, Memorex and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Source: Imation Corp.

Imation Corp.
Scott Robinson, 651-704-4311
srobinson@imation.com

VeeamON 2015

October 26-29, 2015: Las Vegas, NV

SANS Survey Reveals that Organizations Still Lack Enforceable Policy and Control over Mobile Workers and Are Vulnerable to Exposure

More than 64 Percent of Mobile Workers Can Access High-Value Data Remotely while One in Three Devices Are Unmanaged

OAKDALE, Minn.--(BUSINESS WIRE)--May 14, 2015-- Imation Corp. (NYSE:IMN), a global data storage and information security company, today announced the results of a survey of 330 IT and security professionals conducted by SANS. The goal of the survey was to better understand the challenges of securing today’s mobile workforce and managing mobile workspaces. More than 64 percent of survey respondents said a majority of their mobile workforce can access their organizations’ secure data remotely, yet less than 25 percent said sufficient policies/controls are in place for mobile media (i.e., USB drives). An additional 25 percent admitted to having no controls (no policy or technical controls enforced by centralized management) in place. The unmanaged personal computers, laptops, smartphones and tablets that make up almost one-third of the mobile bring-your-own-devices (BYOD) used to access corporate data, combined with lack of controls, leave organizations vulnerable to data exposure.

A top data exposure risk was from malware introduced via unmanaged devices (13.6 percent). Loss or theft of corporate devices was also a major concern for 12.6 percent of respondents; only 13 percent of firms with more than 10,000 employees and 7 percent with 500 to 10,000 employees said they encrypt data on their USB devices.

The survey confirms that despite most organizations’ lack of readiness to support a mobile workforce, the number of mobile employees using BYOD is still growing. According to the survey, 32 percent of organizations expect at least 60 percent of their workforce to be mobile in the next 12 months. With the growth of the mobile workforce, it is important for organizations to quickly gain control through the use of managed mobile devices and workspaces. Currently 63 percent of mobile workers use computer hard drives, not a managed secure point of access, to access corporate data. More than half of respondents reported mobile media (USB drives) are unmanaged, and 43 percent do not manage all the desktops used by mobile workers. The vast number of unmanaged devices accessing corporate data heightens data security risks and makes it impossible for IT to fully protect the organization.

With today’s reality of high-profile hacks, it is unsurprising that 84 percent responded that security is of high, extremely high or critical importance for a mobile workforce. The number and different types of BYOD being brought into the workplace make it difficult to easily, quickly and affordably provision them. Nearly half of the respondents cited configuring/reconfiguring laptops, updating existing devices, and dealing with lost, stolen or broken laptops as their primary challenges when managing mobile devices.

“This survey confirms IT's biggest security fear-- all data, including organizations' high-value data, is still vulnerable. It is encouraging that the survey shows there is more awareness among security professionals than ever before,” said Barbara Nelson, general manager and vice president of Imation Mobile Security (IronKey™). “With the alarming amount of unmanaged mobile devices and workspaces accessing corporate data, IT security professionals have identified mobile security as a priority. The good news is that today there are technologies, such as Windows To Go, that can help solve the challenges of the mobile workforce.”

Nearly one-third of respondents admitted to being unaware if their organization has been breached in the last 12 months. With so little insight into their own networks, and with their jobs on the line, it is unsurprising that almost one third of respondents still do not provide access to corporate data through a cloud application or service.

As many organizations struggle to get ahead, 19 percent of respondents are already using or planning to use Windows To Go features in Windows 8.x or higher. Windows To Go allows IT to securely replicate desktop environments on mobile workspaces, thus providing a secure managed alternative for their mobile workforce. IronKey also solves the challenge of separating personal data from corporate data and the fear of corporate invasion of privacy by turning any USB-enabled device into an insulated corporate workspace.

The survey, “Securing Portable Data and Applications for a Mobile Workforce,” was sponsored by IronKey by Imation and conducted by the SANS Institute between January 2015 and April 2015. 330 IT security professionals representing a broad spectrum of industries, including the technology, government, financial, education and healthcare sectors, as well as organizations of all sizes, completed the questionnaire on their insider-threat awareness and posture.

ADDITIONAL RESOURCES

  • To learn more about the results of the survey and the implications, please register here, and join SANS and IronKey for their joint webinar on May 21.
  • For the full SANS Institute report, download here.
  • For an Infographic highlighting key data points from the survey, view here.
  • To hear customer testimonials about the challenges of managing their mobile workers, watch the Mobile Workspace Security video here.

About Imation Corp.
Imation is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan™ high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation™, Memorex™ and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Imation, the Imation logo, IronKey, the IronKey logo, PC on a Stick™, Nexsan and Memorex are trademarks of Imation Corp. and its subsidiaries. TDK Life on Record is used under a trademark license from TDK Corporation. All other trademarks are property of their respective owners.

Source: Imation Corp.

TRAINER COMMUNICATIONS for Imation
Justin Gillespie, 925-271-8215
ironkey@trainercomm.com

VeeamON Paris 2015

4-June 2015, Espace Pierre Cardin, Paris, France

Imation Introduces Secure Data Discovery to Identify and Safeguard High-Value Data

Imation Secure Data Discovery helps organizations choose optimal storage and protection strategies by assessing file information based on customizable value criteria

OAKDALE, Minn.--(BUSINESS WIRE)--May 14, 2015-- Imation (NYSE:IMN), a global data storage and information security company, today announced the introduction of Imation Secure Data Discovery – an interactive software tool that helps organizations identify their high-value data and determine the most efficient way to store and protect that data. Secure Data Discovery is available today on Imation’s website.

By implementing and using Secure Data Discovery, organizations can assess the value of their file data based on the ages and types of files they have – the factors that Imation found in recent IT user surveys to be most directly related to data value – and their IT system preferences. Secure Data Discovery quickly provides a report, analyzing how many of the organization’s files are considered high-value data, how much disk space those files use and how much primary storage capacity can be saved by offloading less frequently accessed high-value data to an Imation Nexsan Assureon™ secure archive solution for long term protection. Secure Data Discovery users can download and save their analysis reports, and Imation and its channel partners will be able to offer consultative assessments to discuss their results and alternative best practices for protecting high-value data and driving storage efficiencies.

“With our recently launched Secure Data Movement Architecture™ (SDMA™), we’re working to give organizations the most comprehensive and innovative framework to safeguard and protect their most important information assets anywhere and anytime,” said Mike Stolz, vice president of marketing and technical support for Imation’s Nexsan™ solutions. “It’s essential that these organizations understand which of its information assets are the most important to its operations, have the right digital tools to assess their infrastructure and then optimize its storage to safeguard that data. Secure Data Discovery helps them assess the scope of challenges they face, because it identifies high-value data and then helps them think differently about their storage priorities.”

"Identifying high-value data, and figuring out what to do with it, are two of the biggest challenges facing organizations today,” said George Crump, president and founder of Storage Switzerland. “The Imation Secure Data Discovery tool provides end users with an easy solution to help identify where their high-value data resides, enabling them to better manage and safeguard it from data loss.”

"There’s so much disparate data in organizations today and more being created all the time, but there are so many priorities for IT administrators to focus on. Classifying and sorting that data doesn’t often rise to the level of a pressing need, but we’re always amazed at how much efficiency and value these activities unlock within data centers," said Joe Cimino, CTO of VitalNetix, an Imation Gold Partner based in Philadelphia. "Secure Data Discovery makes it easier than ever for administrators to truly understand their data. With that knowledge, they can transparently and non-disruptively move data to the right storage system through SDMA, provision their capacity for optimal efficiency and rest easy knowing their data is in the safest place it can be.”

Imation’s SDMA gives organizations a holistic approach to actively manage their high-value data files and protect them from tampering, destruction, loss or leakage through their entire lifecycle. Imation’s Nexsan Assureon secure archive solutions and IronKey™ secure storage solutions are two critical components of SDMA that are available and in use today. The Nexsan Assureon family of solutions provides high levels of security and integrity for archive data and can drive optimal organizational efficiency that reduces operational data management costs. Meanwhile, IronKey mobile storage solutions enable users to securely access their workspaces and files remotely while adhering to corporate IT standards.

With over fifty years of experience in protecting data for organizations around the world, Imation has a unique perspective to the risk organizations face in managing their data files. This legacy, along with a comprehensive secure product portfolio and over fifty data security patents and patents pending, demonstrate Imation’s mission of safeguarding data across today’s broader storage.

For more information on Imation’s Nexsan storage solutions, visit www.imation.com/en/nexsan.

About Imation
Imation (NYSE: IMN) is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation, Memorex and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Follow @Nexsan and @ironkeysecurity on Twitter.

Imation, the Imation logo, Nexsan, the Nexsan by Imation logo, Secure Data Movement Architecture, SDMA, IronKey, Assureon and Memorex are trademarks of Imation Corp. TDK Life on Record is a trademark of TDK Corporation and is used under license. All other trademarks are property of their respective owners.

Source: Imation Corp.

For Imation Corp.
Jason Sprenger, 612-327-1886
jsprenger@gamechangercommunications.com

Imation Reports First Quarter 2015 Financial Results

Storage and Security Solutions continues to deliver year-over-year growth

Expects to provide an update on review of strategic alternatives in coming weeks

OAKDALE, Minn.--(BUSINESS WIRE)--May 6, 2015-- Imation Corp. (NYSE:IMN) today released financial results for the first quarter ended March 31, 2015.

Q1 Overview

For the first quarter of 2015, Imation reported net revenue of $155.4 million, down 13.1 percent from Q1 2014, an operating loss from continuing operations of $13.0 million, including special charges of $1.2 million, diluted loss per share from continuing operations of $0.35 and a cash balance of $96.2 million. The decline in revenue is attributed to a decline of $23.5 million in the legacy Consumer Storage Media business and foreign currency exchange rates, which negatively impacted Q1 2015 revenues by 6.5 percent, or $11.7 million, compared to Q1 2014.

Imation’s Chief Executive Officer Mark Lucas commented, “We are highly encouraged that our efforts to transform Imation into a global leader in data storage and security are working as demonstrated by the greater than 20 percent revenue growth in our combined Nexsan™ and IronKey™ portfolios. The strategic investments we have made in our priority growth businesses have strengthened the pillars of our Tiered Storage and Security Solutions (TSS) segment, which serves as the foundation for profitable growth over the long term. Bolstering our sales and engineering teams has allowed us to introduce and market new, higher margin products that have been well received by a variety of customers, including Fortune 100 companies and large government agencies in the United States and abroad. As a result of these initiatives, during the first quarter, we saw continued positive sales momentum in our Storage and Security Solutions portfolio with year-over-year growth. We anticipate our Consumer Storage & Accessories (CSA) segment will continue to produce strong cash flows to fund the continued growth of our TSS segment.”

Lucas continued, “While we execute on our strategic plan, we also continue to work with our financial adviser, Houlihan Lokey, in exploring all potential strategic alternatives to maximize shareholder value. We are very pleased with the progress to date and the alternatives that have surfaced through this fulsome process, and we look forward to sharing the results and our recommendations when the evaluation is complete in the coming weeks.”

Business Segment Overview

Lucas said, “Further penetrating higher growth markets where we can bring our enterprise class commercial storage solutions to customers remains a top priority. Our IronKey mobile security products continue to benefit from the growing demand for BYOD (bring your own device) solutions, with hundreds of new customer deployments of our Windows To Go solutions, and the introduction of the IronKey S1000, a secure USB 3.0 flash drive, during the quarter. Our PC on a Stick™ product line incorporates our patented technology, is Microsoft certified and supported, and allows enterprises to offer Microsoft Windows technology on a secure flash drive. We have had successful results with large enterprises for use with Microsoft Windows 8 and 8.1. We believe Microsoft’s expected release of Windows 10 later this year will be a catalyst for driving our PC on a Stick revenues.”

During the quarter, Imation continued to gain traction in its storage solutions business with the global rollout of its Assureon® product family and the successful launch of the NST™ 4000. Furthermore, Imation saw increased demand for its storage solutions in a number of key industry verticals, including media & entertainment, healthcare and video surveillance. Imation also strengthened its data security solutions portfolio by introducing Secure Data Movement Architecture™, or SDMA™. This innovative product provides organizations a holistic approach to actively manage their high-value data files and protect them from tampering, destruction, loss or leakage through their entire lifecycle. SDMA empowers end users to manage their own policy for protecting their high-value data in addition to enabling organizational control and management policies.

Lucas continued, “The improved strength in our storage and security businesses drove an overall increase in our TSS segment sales and margins, underscoring that our strategic plan is yielding results. In our CSA segment, we continue to manage the secular decline in our legacy media business to generate meaningful cash flow. Additionally, we continue to introduce new consumer storage products, including the LINKTM Power Drive, our first mobile storage product that provides additional storage and power for iOS compatible devices. The new additions to our product portfolio have been well received since debuting earlier this year at the Consumer Electronics Show. For all these reasons, and as a result of the other steps we have taken to transform the Company, we believe Imation is positioned to deliver substantial growth and shareholder value.”

Detailed Q1 2015 Analysis

The following financial results are for continuing operations for the current and prior periods unless otherwise indicated. See Tables Five and Six for a description of non-GAAP financial measures.

Net revenue for Q1 2015 was $155.4 million, down 13.1 percent from Q1 2014. From a segment perspective, TSS grew 1.6 percent and CSA declined 24.8 percent. Within the TSS segment, Storage and Security Solutions grew year-over-year by 17.5 percent, partly offset by Commercial Storage Media declines of 6.8 percent. The growth in Storage and Security Solutions was due to both our Nexsan hybrid storage and IronKey mobile security solutions portfolios. Commercial Storage Media only had single digit percentage revenue declines compared to double digit declines in Q1 2014. CSA revenue decreased due to the ongoing declines in optical media products, which were in line with industry trends, along with negative foreign currency impacts. Foreign currency exchange rates negatively impacted total Q1 2015 revenues by 6.5 percent compared to Q1 2014.

Gross margin for Q1 2015 was 21.9 percent, 3.1 percentage points better than Q1 2014. CSA gross margin was 23.7 percent, up from 19.3 percent in Q1 2014 primarily driven by the reversal of a $2.8 million accrual for copyright levies as a result of a favorable court ruling in Germany. TSS gross margin for Q1 2015 was 20.2 percent, up from 18.3 percent in Q1 2014 driven by higher margins in our Storage and Security Solutions business which reflects our focus on increasing gross margins as part of our strategic transformation.

Selling, general and administrative expenses in Q1 2015 were $41.0 million, down $2.4 million compared with Q1 2014 expenses of $43.4 million due to lower spending and currency impacts. During 2013 and 2014 we have reduced legacy operating costs by $103.0 million.

Research and development (R&D) expenses in Q1 2015 were $4.8 million, up from $4.3 million in Q1 2014, which reflects the Company’s increased investment in higher margin projects in Storage and Security Solutions. The Company continued to invest in new product development in its priority businesses and has aggressively reduced R&D expense associated with legacy media products.

Special charges were $1.2 million in Q1 2015 compared to special charges of $2.1 million in Q1 2014. Special charges in Q1 2015 were primarily related to severance charges.

Operating loss from continuing operations was $13.0 million in Q1 2015 compared with an operating loss of $16.1 million in Q1 2014. Excluding the impact of special charges described above, adjusted operating loss would have been $11.8 million in Q1 2015 compared with adjusted operating loss on the same basis of $14.0 million in Q1 2014 (see Tables Five and Six for non-GAAP measures).

Income tax expense was $0.1 million in Q1 2015 compared with no income tax expense in Q1 2014. The Company maintains a valuation allowance related to its U.S. deferred tax assets and, therefore, no tax expense or benefit was recorded related to its U.S. results in either period.

Discontinued operations had no effect in Q1 2015 compared with a loss of $0.7 million (after-tax) in Q1 2014. Discontinued operations include both the results of the XtremeMac™ and Memorex™ consumer electronics businesses which were sold.

Loss per diluted share from continuing operations was $0.35 in Q1 2015 compared with a loss per diluted share of $0.41 in Q1 2014. Excluding the impact of special items, adjusted loss per diluted share would have been $0.32 in Q1 2015 compared with a loss per diluted share of $0.36 in Q1 2014 (see Tables Five and Six for non-GAAP measures).

Cash and cash equivalents balance was $96.2 million as of March 31, 2015, down $18.4 million during the quarter, in line with expectations. The anticipated decline in cash balance reflects the ongoing investment in Storage and Security Solutions growth initiatives and seasonal working capital changes and payments, as well as currency impacts. Imation repurchased approximately 157,000 shares of common stock for $0.7 million during the quarter.

Webcast and Replay Information

A teleconference is scheduled for 9:00 AM Central Time today, May 6, 2015, and will be available on the Internet on a listen-only basis at www.ir.Imation.com or www.streetevents.com. The Company's quarterly financial results will be discussed.

A taped replay of the teleconference will be available beginning at 12:30 PM Central Time on May 6, 2015, until 11:00 PM Central Time on May 15, 2015, by dialing 855-859-2056 or 404-537-3406 (conference ID 22708755). All remarks made during the teleconference will be current at the time of the teleconference, and the replay will not be updated to reflect any subsequent developments.

Description of Tables

Table One - Consolidated Statements of Operations

Table Two - Consolidated Balance Sheets

Table Three - Supplemental Segment and Product Information

Table Four - Additional Information

Table Five - Non-GAAP Financial Measures

Table Six - Non-GAAP Financial Measures

Non-GAAP Financial Measures

The non-GAAP financial measurements (adjusted gross margin, adjusted operating income (loss), adjusted earnings (loss) per diluted share, EBITDA and adjusted EBITDA) are provided as a supplement and should not be construed as an alternative to any GAAP measure of performance or liquidity (see Tables Five and Six). Management believes this will assist investors in making an evaluation of Imation's performance and will assist in understanding the impact of certain items on Imation’s actual results of operations when compared to prior periods. Management understands that there are material limitations on the use of non-GAAP measures. Non-GAAP measures are not substitutes for GAAP measures for the purpose of analyzing financial performance. These non-GAAP measures are not in accordance with, or an alternative for measures prepared in accordance with, generally accepted accounting principles and may be different from non-GAAP measures used by other companies. In addition, these non-GAAP measures are not based on any comprehensive set of accounting rules or principles. This information should not be construed as an alternative to the reported results, which have been determined in accordance with accounting principles generally accepted in the United States of America.

About Imation Corp.

Imation (NYSE: IMN) is a global data storage and data security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s Storage and Security portfolio includes Nexsan high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation, Memorex and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Risk and Uncertainties

Certain information contained in this press release which does not relate to historical financial information may be deemed to constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are subject to certain risks and uncertainties that could cause our actual results in the future to differ materially from our historical results and those presently anticipated or projected. We wish to caution investors not to place undue reliance on any such forward-looking statements. Any forward-looking statements speak only as of the date on which such statements are made, and we undertake no obligation to update such statements to reflect events or circumstances arising after such date. Risk factors include various factors set forth from time to time in our filings with the Securities and Exchange Commission including the following: Our ability to successfully implement our strategy; our ability to grow our business in new products with profitable margins and the rate of revenue decline for certain existing products; our ability to meet future revenue growth, gross margin and earnings targets; the ability to quickly develop, source, introduce and deliver differentiated and innovative products; our potential dependence on third parties for new product introductions or technologies in order to introduce our own new products; our ability to successfully implement restructuring plans; foreign currency fluctuations; the ready availability and price of energy and key raw materials or critical components including the effects of natural disasters and our ability to pass along raw materials price increases to our customers; continuing uncertainty in global and regional economic conditions; our ability to identify, value, integrate and realize the expected benefits from any acquisition which has occurred or may occur in connection with our strategy; the possibility that our goodwill and intangible assets or any goodwill or intangible assets that we acquire may become impaired; the ability of our security products to withstand cyber-attacks; the loss of a major customer, partner or reseller; changes in European law or practice related to the imposition or collectability of optical levies; the seasonality and volatility of the markets in which we operate; significant changes in discount rates and other assumptions used in the valuation of our pension plans; changes in tax laws, regulations and results of inspections by various tax authorities; our ability to successfully defend our intellectual property rights and the ability or willingness of our suppliers to provide adequate protection against third party intellectual property or product liability claims; the outcome of any pending or future litigation and patent disputes; our ability to access financing to achieve strategic objectives and growth due to changes in the capital and credit markets; limitations in our operations that could arise from compliance with the debt covenants in our credit facilities; our ability to retain key employees; increased compliance with changing laws and regulations potentially affecting our operating results; failure to adequately protect our information systems from cyber-attacks; the effect of the announcement of our review of strategic alternatives; the effect of the proxy contest for the election of directors at our annual meeting and other activist shareholder activities; and the volatility of our stock price due to our results or market trends.

Imation, Nexsan, IronKey, Assureon, NST, LINK, Secure Data Movement Architecture, SDMA and Memorex are trademarks of Imation Corp. TDK Life on Record is used under a trademark license from TDK Corporation. All other trademarks are the property of their respective owners.

   

Table One

 

IMATION CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except for per share amounts)

(Unaudited)

Three Months Ended
March 31
2015 2014
Net revenue $ 155.4 $ 178.9
Cost of goods sold   121.4     145.2  

Gross profit

 

34.0 33.7
 
Operating expense:
Selling, general and administrative 41.0 43.4
Research and development 4.8 4.3
Restructuring and other   1.2     2.1  

Total

 

47.0 49.8
 
Operating loss from continuing operations (13.0 ) (16.1 )
 
Other (income) expense:

Interest income

(0.1 ) (0.1 )

Interest expense

0.6 0.6

Other, net expense

 

  0.8     0.2  

Total

 

1.3 0.7
 
Loss from continuing operations before income taxes (14.3 ) (16.8 )
 
Income tax provision   0.1     -  
 
Loss from continuing operations (14.4 ) (16.8 )
 
Discontinued operations:

Loss on sale of discontinued businesses, net of income taxes

- (0.5 )

Loss from discontinued businesses, net of income taxes

 

-

  (0.2 )

Loss from discontinued operations

 

  -   (0.7 )
 
Net loss $ (14.4 ) $ (17.5 )
 
Loss per common share - basic:

Continuing operations

$ (0.35 ) $ (0.41 )

Discontinued operations

- (0.02 )

Net loss

(0.35 ) (0.43 )
 

Loss per common share - diluted:

Continuing operations

$ (0.35 ) $ (0.41 )

Discontinued operations

- (0.02 )

Net loss

 

(0.35 ) (0.43 )
 
Weighted average shares outstanding:

Basic

41.0 40.8

Diluted

41.0 40.8
 

 

Table Two

 
IMATION CORP.
CONSOLIDATED BALANCE SHEETS
(In millions)
(Unaudited)
 

 

March 31,

December 31,
2015 2014
ASSETS
Current assets:
Cash and cash equivalents $ 96.2 $ 114.6
Accounts receivable, net 109.3 134.4
Inventories 62.9 57.7
Other current assets   32.3   32.7
 

Total current assets

300.7 339.4
 
Property, plant and equipment, net 43.5 45.0
Intangible assets, net 54.2 57.9
Goodwill 36.1 36.1
Other assets   18.3   20.8
 
Total assets $ 452.8 $ 499.2
 
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 92.2 $ 95.5
Short-term debt 20.1 18.9
Other current liabilities   77.9   98.2
 
Total current liabilities 190.2 212.6
 
Other liabilities 42.1 45.8
       
Total liabilities   232.3   258.4
Commitments and contingencies        
Shareholders' equity   220.5   240.8
 
Total liabilities and shareholders' equity $ 452.8 $ 499.2
 

 

Table Three

       
IMATION CORP.
SUPPLEMENTAL SEGMENT AND PRODUCT INFORMATION
(Dollars in millions)
(Unaudited)
 
 
Three months ended Three months ended
March 31, March 31,
2015 2014 % Change
Revenue % Total Revenue % Total
Consumer Storage and Accessories
Consumer Storage Media $ 66.0 42.5 % $ 89.5 50.0 % -26.3 %
Audio and Accessories   9.2   5.9 %   10.5   5.9 % -12.4 %
Total Consumer Storage and Accessories   75.2   48.4 %   100.0   55.9 % -24.8 %
Tiered Storage and Security Solutions
Commercial Storage Media 47.9 30.8 % 51.4 28.7 % -6.8 %
Storage and Security Solutions   32.3   20.8 %   27.5   15.4 % 17.5 %

Total Tiered Storage and Security Solutions

  80.2   51.6 %   78.9   44.1 % 1.6 %
Total $ 155.4   100.0 % $ 178.9   100.0 %
 
 
Operating Income

 

Operating Income

 

(Loss)  

OI %

(Loss)  

OI %

Consumer Storage and Accessories $ 3.9 5.2 % $ 4.1 4.1 % -4.9 %
Tiered Storage and Security Solutions (6.5 ) -8.1 % (8.8 ) -11.2 % -26.1 %
Corp/Unallocated (1)   (10.4 ) NM     (11.4 ) NM   -8.8 %
Total operating loss from continuing operations $ (13.0 ) -8.4 % $ (16.1 ) -9.0 %
 
Gross Margin Gross Margin
 
Consumer Storage and Accessories 23.7 % 19.3

 

%

Tiered Storage and Security Solutions   20.2     18.3  
Total 21.9 % 18.8 %
 
 
NM - Not Meaningful
 

(1) Corporate and unallocated amounts may include depreciation and amortization expense, litigation settlement expense, goodwill impairment, intangible impairments, corporate expense, inventory write-offs related to our restructuring programs and restructuring and other expenses which are not allocated to the segments. We believe the presentation of these items in Corporate and Unallocated avoids distorting the operating income for our segments.

 

 
Table Four
   
IMATION CORP.
ADDITIONAL INFORMATION
(Dollars in millions)
(Unaudited)
Three Months Ended
March 31
Cash and Cash Flow Information 2015 2014
 
Cash and cash equivalents - end of period $ 96.2 $ 126.2
Capital spending $ 0.8 $ 1.0
Depreciation $ 2.1 $ 2.3
Amortization $ 3.3 $ 3.2
 
 

Asset Utilization Information *

March 31 December 31
2015 2014
 
Days Sales Outstanding (DSO) 55 55
Days of Inventory Supply 49 44
Debt to Total Capital 8.4 % 7.3 %
 
 
Other Information
 
Approximate employee count as of March 31, 2015: 900
Approximate employee count as of December 31, 2014: 910
Book value per share as of March 31, 2015: $ 5.38
Shares used to calculate book value per share (millions): 41.0
Imation repurchased approximately 157,000 shares of its stock during the first quarter of 2015 for $0.7 million.
 
 

* These operational measures, which we regularly use, are provided to assist in the investor's further understanding of our operations.

 

Days Sales Outstanding is calculated using the count-back method, which calculates the number of days of most recent revenue that are reflected in the net accounts receivable balance.

 

Days of Inventory Supply is calculated using the current period inventory balance divided by an estimate of the inventoriable portion of cost of goods sold expressed in days.

 

Debt to Total Capital is calculated by dividing total debt (long term plus short term) by total shareholders' equity and total debt.

 

 

Table Five

               
IMATION CORP.
Non-GAAP Financial Measures
(In millions, except for per share amounts)
(Unaudited)
 
Three Months Ended Three Months Ended
March 31, 2015 March 31, 2014
GAAP Adj * Non-GAAP GAAP Adj * Non-GAAP
Net revenue $ 155.4 $ - $ 155.4 $ 178.9 $ - $ 178.9
Cost of goods sold   121.4     -   121.4     145.2     -   145.2  

Adjusted gross profit

 

$ 34.0   $ - $ 34.0   $ 33.7   $ - $ 33.7  
 
Adjusted gross margin 21.9 % 21.9 % 18.8 % 18.8 %
 
Adjusted operating loss from continuing operations $ (13.0 ) $ 1.2 $ (11.8 ) $ (16.1 ) $ 2.1 $ (14.0 )
 
Adjusted income tax provision $ 0.1 $ - $ 0.1 $ - $ - $ -
 
Adjusted loss from continuing operations $ (14.4 ) $ 1.2 $ (13.2 ) $ (16.8 ) $ 2.1 $ (14.7 )

 

Adjusted loss per common share from continuing operations - diluted

$ (0.35 ) $ (0.32 ) $ (0.41 ) $ (0.36 )
 
Adjusted weighted average shares outstanding - diluted 41.0 41.0 40.8 40.8
 

* See Table Six

 

   
Table Six
   
IMATION CORP.
Non-GAAP Financial Measures
(In millions, except for per share amounts)
(Unaudited)
 

Operating income (loss) / Adjusted operating income (loss)

 
Three Months Ended
March 31
2015 2014
Operating loss $ (13.0 ) $ (16.1 )
Restructuring and other:
Restructuring 0.8 0.6
Other   0.4     1.5  
Total adjustments   1.2     2.1  
Adjusted operating income (loss) - Non-GAAP $ (11.8 ) $ (14.0 )
 
Effect on diluted EPS:
Loss from operations $ (0.35 ) $ (0.41 )
Restructuring and other:
Restructuring 0.02 0.01
Other   0.01     0.04  
Adjusted diluted EPS - Non-GAAP $ (0.32 ) $ (0.36 )
 
 
EBITDA:
Operating loss from continuing operations (13.0 ) $ (16.1 )
Depreciation 2.1 2.3
Amortization   3.3     3.2  
EBITDA $ (7.6 ) $ (10.6 )
Restructuring and other   1.2     2.1  
Total adjustments   1.2     2.1  
Adjusted EBITDA $ (6.4 ) $ (8.5 )
 
 
EBITDA is defined as operating income (loss) less depreciation and amortization. Adjusted EBITDA is defined as EBITDA before restructuring and other and inventory write-downs related to restructuring programs included in cost of goods sold.
 
 
The Non-GAAP financial measurements (adjusted operating income (loss), adjusted income (loss), adjusted diluted EPS, EBITDA and adjusted EBITDA) are provided to assist in understanding the impact of certain items on Imation's actual results of operations when compared with prior periods. Management believes this will assist investors in making an evaluation of Imation's performance against prior periods on a comparable basis by adjusting for these items. Management understands that there are material limitations on the use of Non-GAAP measures. Non-GAAP measures are not substitutes for GAAP measures for the purpose of analyzing financial performance. These Non-GAAP measures are not in accordance with, or an alternative for measures prepared in accordance with, generally accepted accounting principles and may be different from Non-GAAP measures used by other companies. In addition, these Non-GAAP measures are not based on any comprehensive set of accounting rules or principles. This information should not be construed as an alternative to the reported results, which have been determined in accordance with accounting principles generally accepted in the United States of America.
 

Source: Imation Corp.

Imation Corp.
Scott Robinson, 651-704-4311
srobinson@imation.com

IronKey™ by Imation Adds Key Functionality to Most Comprehensive and Secure Windows To Go Offering: Windows 10-Ready, Microsoft SCCM Workflow Integration and Citrix-Ready Certification

New Scriptable Provisioning Deploys Windows To Go Drives as Easily as Laptops; Citrix-Ready Certified VDI Capabilities Transform Windows To Go Drives into Secure Endpoints for Cloud Applications

OAKDALE, Minn.--(BUSINESS WIRE)--May 5, 2015-- Imation Corp. (NYSE:IMN), a global data storage and information security company, today announced that it will showcase the industry’s most comprehensive and secure Windows To Go offering at Microsoft Ignite on May 4-8, 2015, in Chicago, Ill. IronKey secure workspace devices are now fully Windows 10 ready. In addition, Imation’s new IronKey Workspace Command Line Utility provides the industry’s only solution for including hardware- and software-encrypted Windows To Go devices in regular desktop and laptop provisioning workflows. Enterprises can now leverage Batch and PowerShell script samples, thus simplifying integration into their device preparation and Microsoft System Center Configuration Manager (SCCM) workflows. This capability, when combined with the devices' small, light form factor, makes deployment of Windows To Go drives significantly easier and faster than regular desktop or laptop deployments. IT can prepare hundreds of workspace devices at a time, install a Windows image and perform common post-provisioning tasks such as domain joins and OS updates. In addition, IronKey S/D250 and S1000 flash drives, H300 hard drives, and W500, W700 and W700SC workspace devices are now Citrix-Ready certified, allowing IronKey products to meet the high demand for a safe platform to run Citrix, Office Online, VPN, Microsoft VDI and other cloud clients. This certification enables IT to securely manage the OS and hardware that access business applications in the cloud.

“Imation has the industry’s broadest mobile workspace PC on a StickTM solutions and most extensive track record of enabling enterprises and government agencies to support an ever-increasing and diverse mobile workforce with this innovative technology,” said Ken Jones, vice president of engineering and product management for Imation Mobile Security. “Now with our Citrix certification, new scripting capabilities and Windows 10 readiness, our IronKey Windows To Go solution is truly unmatched.”

Windows To Go, a benefit available to Microsoft Volume License customers, lets workers be productive from any location they choose by inserting the Windows To Go USB drive into any compatible PC, tablet or Mac. With IronKey Workspace, users have access to their corporate image, applications and security policies, all stored on a secure flash drive - at savings of up to 90 percent compared to the cost of laptops. And Imation makes it simple for users to use with the exclusive IronKey Startup Assistant which automatically configures the boot order of compatible host computers so they will boot first from the USB drive if one is present. Imation is the single-stop shop for secure mobile workspaces that run Windows To Go.

New Scriptable Provisioning for Windows To Go Devices
The company is continuing its investment and innovation in Windows To Go devices by adding scriptable deployment capabilities to its IronKey Workspace Provisioning Tool, which allows simultaneous creation of 14 Workspace devices. As a result, enterprises can easily incorporate hardware-encrypted IronKey Workspace W500 and W700 devices, as well as software-encrypted IronKey Workspace W300 devices, into their common device-preparation flows and treat an IronKey Workspace device deployment just as they would a laptop deployment. IT users can provision a golden Microsoft image (WIM) and perform post-provisioning customization such as domain joins, Windows updates, support for local languages or any other necessary customization. This new capability further simplifies and more fully integrates Windows To Go device deployment for enterprises that script the preparation and deployment of their laptops and desktops.

As part of its Workspace device updates, Imation has extended its Workspace W700 product by adding the W700SC device with support for CAC and PIV standard Smart Cards for U.S. Federal and local government agencies. In addition, IT administrators can now leverage Silver Bullet functionality in combination with IronKey Enterprise Management to securely unlock a user's remote device and thus recover files from devices with corrupt OS or perform other maintenance tasks.

Citrix Certification for IronKey Workspace Devices
Citrix Certification allows businesses to leverage IronKey Workspace devices as more secure and manageable endpoints for key applications. Workspace users can now run both online and full versions of Office 365-provided applications or just VPN clients. IronKey PC on a Stick allows IT managers to provide the full benefits of Windows, including all required corporate applications and end-point protections from malware, keyboard logging and other threats, while at the same time giving users the familiar Windows environment they desire.

Availability and Pricing:
Available today, IronKey Workspace functionality comes free with all Workspace devices; it is also available as a free upgrade to existing Workspace users. The scripting tool is now part of the company’s Workspace Provisioning Tool suite, which has an MSRP of US $5,000.

In addition, at Microsoft Ignite 2015 only, IronKey by Imation is offering its Windows To Go Intro Kit for purchase on the show floor, booth #106. Each kit features a 32GB IronKey Workspace W300 device with Windows pre-loaded, a right-angle USB adapter and an IronKey lanyard for $89.00.

About Imation Corp.
Imation is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan™ high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation™, Memorex™ and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Imation, the Imation logo, IronKey, the IronKey logo, PC on a Stick, Nexsan, and Memorex are trademarks of Imation Corp. and its subsidiaries. TDK Life on Record is used under a trademark license from TDK Corporation. All other trademarks are property of their respective owners.

Source: Imation Corp.

TRAINER COMMUNICATION for Imation
Justin Gillespie, 925-271-8215
ironkey@trainercomm.com

IronKey™ Hardware-Encrypted USB Devices Now Manageable with Latest Version of McAfee ePolicy Orchestrator Software 5.1 from Intel Security

Managed, Secure Drives Help Protect Customers against USB-Related Attacks

OAKDALE, Minn.--(BUSINESS WIRE)--Apr. 29, 2015-- Imation Corp. (NYSE: IMN), a global data storage and information security company, today announced ongoing support for the latest McAfee® ePolicy Orchestrator® (ePO) software version 5.1 from Intel Security with the release of its client and server software, IronKey eUSB for McAfee ePO. Organizations of all sizes can look to ePolicy Orchestrator software to make risk and compliance management simpler and more successful by helping them keep up with the latest security measures. By securing the desktop with ePolicy Orchestrator software, IT administrators can manage and control what devices are used. IronKey is the only USB solution to offer hardware-encrypted storage devices that can be managed with ePolicy Orchestrator software, which has features such as password reset, the ability to remotely wipe or disable devices that are lost or stolen, and more. The combination of IronKey’s military-grade USB devices integrated with ePolicy Orchestrator software helps protect desktop and peripheral devices against data loss and USB-related attacks such as BadUSB.

“The latest version of ePolicy Orchestrator software adds many new capabilities to the existing platform,” said Tom Fountain, senior vice president of strategy and corporate development at Intel Security. “The combination of ePolicy Orchestrator software and IronKey hardware-encrypted USB drives means our joint customers have what we believe is the best secure, managed data-transport solution available.”

The latest version of ePolicy Orchestrator software extends security benefits by improving disaster recovery, browser support and more—making it one of the most advanced security management platforms available today.

“IronKey hardware-encrypted drives set the standard for truly secure end-points for enterprises and governments around the world,” said Ken Jones, vice president of engineering and product management for IronKey. “Our drives are immune to the recent BadUSB threat that jeopardizes IT infrastructures. Using ePolicy Orchestrator software to block other drives locks down the end-point from this sort of pernicious threat.”

The upgrade for ePolicy Orchestrator software by Intel Security is now available for customers using IronKey drives. The upgrade is also available for users of legacy encrypted USB devices, which IronKey has supported since 2012. This upgrade also adds client support for Windows 8/8.1. Once the management server is updated the new software is transparently pushed to clients, making the transition seamless.

Pricing and Availability
IronKey eUSB for McAfee ePO software works with IronKey F200, F150 and F100 flash drives and IronKey H200 and H100 hard drives as well as older MXI and Imation-branded drives and some hardware-encrypted McAfee-branded drives. Existing customers of IronKey Encrypted USB software for ePolicy Orchestrator can now upgrade to a maintenance and support contract that includes the updated IronKey eUSB for McAfee ePO for as little as $10 per device. Prices vary by volume. For more information contact an IronKey sales representative at securitysales@imation.com or 1-888-435-7682.

About Imation Corp.
Imation is a global data storage and information security company. Our products and solutions help organizations and individuals store, manage and protect their digital content. Imation’s storage and security portfolio includes Nexsan™ high-density, archive and solid-state optimized unified hybrid storage solutions; IronKey mobile security solutions that address the needs of professionals for secure data transport and mobile workspaces; and consumer storage solutions, audio products and accessories sold under the Imation™, Memorex™ and TDK Life on Record brands. Imation reaches customers in more than 100 countries through a powerful global distribution network. For more information, visit www.imation.com.

Imation, the Imation logo, IronKey, the IronKey logo, Nexsan, and Memorex are trademarks of Imation Corp. and its subsidiaries. TDK Life on Record is used under a trademark license from TDK Corporation. All other trademarks are property of their respective owners.

No computer system can be absolutely secure.

Intel, the Intel logo, McAfee, the McAfee logo and ePolicy Orchestrator are trademarks of Intel Corporation in the U.S. and/or other countries.

Source: Imation Corp.

TRAINER COMMUNICATIONS for Imation
Justin Gillespie, 925-271-8215
ironkey@trainercomm.com

CUSTOMER SUCCESS STORIES

People and organizations around the world use Imation products to improve productivity, secure and protect their most important digital assets. 

Nexsan by Imation

Case Study: UCLA

High-Performance Computing

UCLA recently needed a storage solution with enough flexibility, capacity and scalability to serve its varied user base.

IronKey by Imation

Microsoft and Imation Experts

The Scoop on Windows to Go

Microsoft and Imation Experts discuss Windows to Go and its role in enabling enterprise mobility.

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Barnickel Design

Small Business Backed By Big Storage

Early in his career, graphic designer Rob Barnickel lost a year’s worth of work when a hard drive failed and he hadn’t made a backup copy. With Imation’s RDX Removable Hard Disk Storage System, he’s confident he won’t have to repeat that experience.