8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (date of earliest event reported): April 23, 2008

Rimage Corporation

(Exact name of Registrant as Specified in its Charter)

Minnesota

(State Or Other Jurisdiction Of Incorporation)

000-00619	41-1577970
(Commission File Number)	(I.R.S. Employer Identification No.)
7725 Washington Avenue South Minneapolis, MN	55439
(Address Of Principal Executive Offices)	(Zip Code)

(952) 944-8144

Registrant’s Telephone Number, Including Area Code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Items under Sections 1 and 3 though 8 are not applicable and therefore omitted.

ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION.

Rimage Corporation (the “Company”) hereby furnishes a press release, issued on April 23, 2008, disclosing material non-public information regarding its results of operations for the quarter ended March 31, 2008 and hereby furnishes statements of its Chief Executive Officer and Chief Financial Officer made on April 23, 2008 at a telephone conference relating to the quarter ended March 31, 2008 results.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

Exhibit No.	Description
99.1	Press Release issued on April 23, 2008.
99.2	Statements of Bernard P. Aldrich, Chief Executive Officer, and Robert M. Wolf, Chief Financial Officer, at a telephone conference held on April 23, 2008.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

RIMAGE CORPORATION
By:	/s/ Robert M. Wolf
	Robert M. Wolf Chief Financial Officer

Date:   April 23, 2008

EX-99.1

EXHIBIT 99.1

Rimage Reports First Quarter Revenues and Earnings

Minneapolis, MN—April 23, 2008—Rimage Corporation (Nasdaq: RIMG) today reported revenues of $22,749,000 for the first quarter ended March 31, 2008, an increase of 6% from $21,526,000 in the year-earlier period. Net income was $1,786,000 or $0.18 per diluted share, compared to $2,122,000 or $0.20 per diluted share in the first quarter of 2007.

Bernard P. (Bernie) Aldrich, president and chief executive officer, commented: “We believe Rimage’s first quarter revenues were adversely affected by lower than anticipated sales of disc publishing hardware, including our high-end Producer family, due primarily to the impact of the weakening economy. This has caused some distributors to adopt a more cautious approach to their purchasing decisions. As a result, consumable supplies rose significantly as a percentage of our total sales for this period. This shift in our sales mix resulted in some gross margin erosion, which caused earnings to fall below previously forecasted levels.”

Aldrich continued: “Although we are not satisfied with Rimage’s first quarter results, we remain optimistic about our prospects. Our pending business activity is encouraging, even though economic conditions may result in longer selling cycles. Efforts aimed at strengthening our European operation are starting to generate the intended results, and we are continuing to invest in our growing Asian business. We have significantly strengthened our sales force over the past year by adding seven new sales representatives and further strengthened our sales channel by adding three new distribution partners.”

He added, “We also see untapped opportunities for our disc publishing technology in various business services markets, including media and broadcasting, law enforcement, education, government, software and professional services. To help Rimage capitalize upon these opportunities, we plan to introduce software later this year that is designed exclusively for Mac-based audio/visual production environments. In addition, our newly introduced Everest 600 color disc surface label printer, which generates superior color graphics and text at faster production speeds than its predecessor model, has been integrated into our Producer equipment line. Equipped with these and other technologies, we believe business services applications will drive a significant portion of Rimage’s future growth, and we plan to focus our resources toward building growing positions in these markets.”

Financial Highlights

Recurring revenues, including sales of printer ribbons and cartridges, parts, blank CD/DVD media and maintenance contracts, increased 27% in the first quarter of 2008 and accounted for 62% of sales, compared to 51% in the first quarter of 2007. Sales of consumables are benefiting from Rimage’s growing installed base of disc publishing systems in retail and other markets.

International sales increased 14% in the first quarter and accounted for 43% of total sales, compared to 41% of total sales in the year-earlier period. This increase was due primarily to foreign currency effects.

Cash and investments totaled $92.4 million at the end of this year’s first quarter, compared to $94.2 million at the beginning of 2008 and $83.5 million at the end of the first quarter of 2007. The sequential quarterly decline in cash was attributable primarily to the payment of income taxes and annual incentive bonuses. Approximately 26,000 Rimage shares were repurchased during the first quarter under two 500,000 share buyback authorizations.

For the second quarter of 2008 ending June 30, Rimage is forecasting earnings of $0.22 to $0.27 per diluted share on revenues of $24 to $26 million.

About Rimage

Rimage Corporation (www.rimage.com) is the world’s leading provider of recordable CD, DVD and BD publishing systems, which are used by businesses to produce discs with customized digital content on an on-demand basis. Rimage’s publishing systems, which span the range from high to low CD/DVD production volumes, integrate robotics, software and surface label printers into a complete publishing solution. Rimage is focusing its CD/DVD publishing solutions on a set of vertical markets with special needs for customized, on-demand digital information, including retail, medical and business services.

Statements regarding Rimage’s anticipated performance are forward-looking and therefore involve risks and uncertainties, including but not limited to: market conditions, competitive products, changes in technology, conditions in overseas markets that could affect international sales, and other factors set forth in Rimage’s filings with the Securities and Exchange Commission.

#       #       #

For additional information, contact:
Bernard P. (Bernie) Aldrich, CEO	Richard G. Cinquina
Robert M. Wolf, CFO	Equity Market Partners
Rimage Corporation	904/415-1415
952/944-8144

RIMAGE CORPORATION

Selected Consolidated Financial Information

(In thousands, except per share data)

(Unaudited)

Consolidated Statements of Income Information:

	Three months ended March 31,
	2008		2007
Revenues	$	22,749	$	21,526
Cost of revenues		13,072		11,778
Gross profit		9,677		9,748
Operating expenses:
Research and development		1,351		1,590
Selling, general and administrative		6,638		5,828
Total operating expenses		7,989		7,418
Operating income		1,688		2,330
Other income, net		1,082		829
Income before income taxes		2,770		3,159
Income tax expense		984		1,037
Net income		1,786		2,122
Net income per basic share	$	0.18	$	0.21
Net income per diluted share	$	0.18	$	0.20
Basic weighted average shares outstanding		9,763		9,979
Diluted weighted average shares outstanding		10,089		10,494

Consolidated Balance Sheet Information:

	Balance as of
	March 31, 2008		December 31, 2007
Cash and marketable securities	$	53,962	$	59,021
Receivables		13,032		14,447
Inventories		7,635		8,075
Total current assets		79,722		84,771
Property and equipment, net		3,084		3,206
Marketable securities – non-current		38,413		35,201
Total assets		123,192		125,096
Current liabilities		12,574		17,882
Long-term liabilities		2,050		2,153
Stockholders’ equity		108,568		105,061

Conference Call and Replay

Rimage Corporation will review its first quarter operating results in a conference call at 10:00 AM Eastern today. Investors can listen to the conference call at www.rimage.com. Listeners should go to this web site at least 15 minutes before the scheduled start time to download and install any necessary audio software. A replay of the conference call can be heard through April 30, 2008 by dialing 1-303-590-3000 and providing the 11112075 confirmation code.

EX-99.2

EXHIBIT 99.2

Remarks of Bernard P. Aldrich

Rimage Corporation 1^st Quarter FY 2008 Conference Call

April 23, 2008

§ Good morning and thank you for taking the time to participate in our first quarter earnings conference call.

§ Joining me today is Rob Wolf, our chief financial officer, who will review our recent operating results in some detail.

§ Also with us is Manny Almeida, our executive vice president of sales and marketing.

§ We will be pleased to take your questions at the conclusion of our opening remarks.

§ Since Regulation FD prohibits us from providing any forward-looking statements unless they are simultaneously released to the public, we have provided financial guidance for the second quarter of 2008 in this morning’s release.

§ It is important to understand that this guidance is subject to a number of risks that could affect our anticipated performance.

§ These risks are set forth in our filings with the Securities and Exchange Commission, which we urge you to review.

§ Turning now to the subject of this conference call, our first quarter sales rose 6% to $22.7 million, from $21.5 million in the year-earlier period.

§ Our earnings came to $1.8 million or $0.18 per diluted share, down from $2.1 million or $0.20 per diluted share in the first quarter of 2007.

§ Our first quarter revenues were adversely affected by lower than anticipated sales of disc publishing hardware, including our high-end Producer family.

§ We believe this hardware shortfall resulted primarily from the impact of the weakening economy, which has caused some distributors to adopt a more cautious approach to their purchasing decisions.

§ As a result, consumable supplies rose significantly as a percentage of our total sales for this period.

§ This shift in our sales mix resulted in some gross margin erosion, which caused earnings to fall below previously forecasted levels.

§ I want to stress that our first quarter results are not indicative of any fundamental problem with Rimage’s operations.

§ To the contrary, our pending business activity is encouraging, even though economic conditions may result in longer selling cycles.

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§ Efforts aimed at strengthening our European operation are working as planned.

§ We are continuing to invest in our growing Asian business, which we view as a major opportunity.

§ We have significantly strengthened our sales force over the past year by adding seven new sales representatives.

§ In addition, we have further strengthened our sales channel by adding three new distribution partners.

§ A significant portion of Rimage’s highly profitable growth over the past few years has been generated by our ability to successfully penetrate the retail and medical imaging markets with our digital publishing solutions.

§ Our equipment has become the retail industry standard for the on-demand publishing of digital data on CDs, DVDs and Blu-ray discs.

§ The same is true of our digital publishing solutions in the medical imaging market, where our systems have become the industry standard for PACS installations in large U.S. hospitals and clinics.

§ We continue to see good opportunities in these markets, both here and overseas, that we will pursue aggressively in the years ahead.

§ We believe business services applications, including media and broadcasting, law enforcement, education, government, software and professional services, represent our next growth opportunity.

§ The applications that we are targeting in the business services market involve managing, archiving and distributing large amounts of data.

§ Today, most data is stored on hard drives, and we believe this media will remain the primary archiving media.

§ However, downloading stored data onto DVDs and Blu-ray discs enables companies and organizations to free up high-cost computer memory.

§ Since much data is not required for immediate use, it can be cost-effectively and conveniently stored on optical discs for future use.

§ Moreover, the use of optical technology for archiving data is particularly compelling for small and mid-sized businesses that are unable or unwilling to make substantial investments in high-capacity computer storage.

§ In addition, using optical technology for disaster recovery, whereby discs are stored at off-site locations, is a related cost-effective technique for organizations of all sizes.

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§ The opportunity for our optical technology is particularly significant in the broadcasting and media market.

§ Large production houses currently use DVDs for editing, producing, distributing and archiving video content.

§ Many of these large operations, including Disney, are already penetrated with Rimage’s CD/DVD digital publishing systems, but they now will be transitioning to high-capacity Blu-ray technology.

§ This conversion process will require new or additional Rimage equipment from these current customers.

§ However, our greatest opportunity in the broadcasting and media market involves thousands of small and mid-sized pre- and post-production houses.

§ In the past, many of these studios archived and distributed their video content on magnetic tape.

§ With the conversion to digital and high definition formats, these facilities are converting to DVD and Blu-ray discs as their preferred output.

§ To help Rimage capitalize upon these opportunities, we plan to introduce new software later this year that is designed specifically for Mac-based audio/visual production environments.

§ This is critically important since Apple has close to a 50% share of the video editing market.

§ This Mac-based software will seamlessly integrate into the Apple environment and workflow.

§ In addition, our new Everest 600 color disc surface label printer, which generates superior color graphics at faster production speeds than its predecessor, has been integrated into our Producer equipment line.

§ The Everest 600 exceeds the most stringent expectations for print quality and return-on-investment.

§ We expect to integrate the Everest 600 into our Professional Series mid-range line of disc publishing systems later this year.

§ All in all, we believe business services applications will drive a significant portion of Rimage’s future growth, and we plan to focus our resources toward building growing positions in these markets.

§ Now, I will turn to the financial guidance contained in this morning’s release.

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§ Given the fact that we provide capital equipment to businesses, prevailing economic conditions could continue to have an impact on the purchasing decisions of our customers.

§ Reflecting this possibility, we are forecasting earnings of $0.22 to $0.27 per diluted share on revenues of $24 to $26 million for the second quarter of 2008 ending June 30.

§ During such times as today, it is our job to work harder and smarter, as well as continue making the investments in our business that will pave the way for strong results over the long term.

§ We are fully committed to doing exactly that.

§ Thank you. Now Rob Wolf will review our first quarter results in some detail.

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Remarks of Robert M. Wolf

Rimage Corporation 1^st Quarter FY 2008 Conference Call

April 23, 2008

§ Thanks, Bernie.

§ First, I will run through a few highlights about our first quarter sales.

§ Recurring revenues, including sales of printer ribbons and cartridges, parts, blank CD/DVD media and maintenance contracts, increased 27% in the first quarter and accounted for 62% of sales, compared to 51% in the first quarter of 2007.

§ In our last conference, we said that we expected consumables sales growth to accelerate in 2008 as our equipment was installed in the stores involved with the significant retail orders that we received in 2007.

§ That proved to be the case in this year’s first quarter, and we expect consumables sales growth to remain robust in 2008.

§ However, as a percentage of total sales, consumables are expected to decline in coming quarters, based on our outlook for improving hardware sales.

§ International sales increased 14% in the first quarter and accounted for 43% of total sales, compared to 41% in the first quarter of 2007.

§ This increase was due primarily to foreign currency effects.

§ Rimage’s gross margin was 43% in the first quarter, down from 48% in the fourth quarter of 2007 and 45% in the first quarter of 2007.

§ As Bernie mentioned previously, our gross margin in this year’s first quarter was affected by the shift in our sales mix toward consumable supplies, which carry lower gross margins than those associated with disc publishing hardware.

§ We anticipate an improved gross margin in the mid-40% range in this year’s second quarter.

§ Moving down the P&L, first quarter R&D expense came to $1.4 million, up modestly from $1.3 million in last year’s fourth quarter and down from $1.6 million in the year-earlier period.

§ The year-over-year decrease in R&D reflects the completion of several important product development initiatives in 2007.

§ R&D spending in the second quarter of 2008 is forecasted to be at or near the first quarter level.

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§ Selling, general and administrative expense totaled $6.6 million in this year’s first quarter, compared to $6.1 million in last year’s fourth quarter and $5.8 million in the first quarter of 2007.

§ Substantially all of the sequential and year-over-year increases in SG&A were driven by continued expansion of Rimage’s sales and marketing organization.

§ We believe second quarter SG&A will be at or near the first quarter level.

§ We recorded an effective income tax rate of 36% in the first quarter, compared to 37% in last year’s fourth quarter and 33% in the first quarter of 2007. The lower tax rate in the prior year’s first quarter was primarily affected by the elimination of certain tax reserves.

§ We believe our effective income tax rate for 2008 will be in the range of 35% to 37%.

§ Turning now to our balance sheet.

§ Cash and investments totaled $92.4 million at the end of this year’s first quarter, compared to $94.2 million at the beginning of 2008 and $83.5 million at the end of the first quarter of 2007.

§ The sequential decline in cash between the first and fourth quarters was attributable primarily to the payment of income taxes and annual incentive bonuses.

§ A nominal amount of cash was used to repurchase 26,000 Rimage shares during the first quarter under two existing 500,000 share buyback authorizations.

§ Nearly all of the 1 million shares under these authorizations remain available for repurchase.

§ Stockholders’ equity came to $108.6 million at the end of this year’s first quarter, up from $105.1 million at the end of 2007 and $100.3 million at the end of the first quarter of 2007.

§ That wraps up our formal remarks, and now the conference call operator will poll you for any questions.

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