DATARAM PRESS RELEASE Dataram Contact: Investor Contact: Mark Maddocks, Joe Zappulla Chief Financial Officer Wall Street Investor Relations Corp. 609-799-0071 212-714-2445 info@dataram.com JZappulla@WallStreetIR.com DATARAM REPORTS SECOND QUARTER FINANCIAL RESULTS Company Pays Off Long-Term Debt and Continues Open Market Share Repurchases PRINCETON, N.J. November 20, 2002 - Dataram Corporation (NASDAQ: DRAM) today reported its financial results for its second quarter of fiscal 2003 ended October 31, 2002. Revenues for the second quarter were $14.0 million compared to $14.3 million for the previous sequential quarter and $19.2 million for the same period of the prior year. The Company reported a net loss of $253,000 or $0.03 per share for the second quarter compared to a loss of $1.8 million, or $0.21 per share in the prior sequential quarter, which includes restructuring charges of $740,000, and net earnings of $160,000 or $0.02 per share in the second quarter of last fiscal year. (In 000's, except First Second Six per share amounts) Quarter Quarter Months ___________________ _______ _______________ _______________ FY 2003 FY2003 FY2002 FY2003 FY2002 _______ _______________ _______________ Revenues $ 14,282 $ 13,970 $ 19,173 $ 28,252 $ 41,744 Net earnings (loss) (1,823) (253) 160 (2,076) (1,601) Net earnings (loss) per share (0.21) (0.03) 0.02 (0.24) (0.19) Diluted shares outstanding 8,483 8,504 9,291 8,494 8,502 Mark Maddocks, Dataram's CFO stated, "Our free cash flow significantly exceeds our earnings. Non-cash depreciation and amortization charges for the second quarter and first six months of this fiscal year totaled approximately $1.0 million and $2.0 million, respectively, versus capital expenditures of approximately $125,000 and $250,000, respectively, for the same periods. These levels of non-cash charges and capital expenditures and their impact on free cash flow are representative of expected future levels for the remainder of this fiscal year." Robert Tarantino, Dataram's president and CEO, added, "During the quarter, we improved our financial condition by paying down $1.0 million in long-term debt. Shortly after the end of the quarter, we paid off an additional $500,000 and we are now debt free. Also, the Company has continued to participate in the market for its shares, purchasing 84,900 shares of its common stock in the quarter at a total price of $256,000 as part of its open market repurchase program. The company will continue to repurchase its shares during its fiscal third quarter." Mr. Tarantino concluded, "During the last two years, we have successfully weathered a terrible market, especially for companies in the technology space. During that time, we have taken the steps necessary to align our cost structure with the realities of the market environment, while still preserving our key capabilities. In spite of the difficult environment, we have been cash flow positive throughout that period. We feel that the worst of the market downturn is behind us and that the changes we have made will allow us to grow profitably from here. We expect our earnings to be approximately break even in the current quarter and to return to profitability no later than the fourth quarter of this fiscal year." Dataram will conduct a conference call at 11:00 a.m. (EST) today to present its second quarter financial results and to respond to investor questions. Interested shareholders may participate in the call by dialing 888-214-7566 and providing the following reservation number: 21041357. It is recommended that participants call 10 minutes before the conference call is scheduled to begin. The conference call can also be accessed over the Internet through Vcall at www.vcall.com. A replay of the call will be available approximately one hour after the completion of the conference call through Vcall and for 24 hours by dialing 800-633-8284 or 402-977-9140 and entering the reservation number listed above. ABOUT DATARAM CORPORATION Dataram Corporation, celebrating its 35th year in the computer industry, is a leading provider of computer memory. The Company offers a specialized line of gigabyte-class memory for entry- to enterprise-level servers, workstations and notebooks from Compaq, Dell, Fujitsu/Siemens, HP, IBM, Intel, SGI, Sun and Toshiba. Additional information is available on the Internet at www.dataram.com. Financial Tables Follow DATARAM CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts) (Unaudited) Three Months Ended Six Months Ended 10/31/2002 10/31/2001 10/31/2002 10/31/2001 Revenues $ 13,970 $ 19,173 $ 28,252 $ 41,744 Costs and expenses: Cost of sales 9,770 12,052 20,510 27,677 Engineering and development 400 413 782 1,008 Selling, general and administrative 4,269 5,210 8,806 11,266 Intangible asset amortization 0 296 0 593 Restructuring charges 0 0 740 1,200 ________ ________ ________ ________ 14,439 17,971 30,838 41,744 Earnings (loss) from operations (469) 1,202 (2,586) 0 Interest income (expense), net (10) (143) (54) (297) ________ ________ ________ ________ Earnings (loss) before income taxes (479) 1,059 (2,640) (297) Income tax provision (benefit) (226) 899 (564) 1,304 ________ ________ ________ ________ Net earnings (loss) $ (253) $ 160 $ (2,076) $ (1,601) ======== ======== ======== ======== Net earnings (loss) per share: Basic $ (.03) $ .02 $ (.24) $ (.19) ======== ======== ======== ======== Diluted $ (.03) $ .02 $ (.24) $ (.19) ======== ======== ======== ======== Average number of shares outstanding: Basic 8,504 8,480 8,494 8,502 ======== ======== ======== ======== Diluted 8,504 9,291 8,494 8,502 ======== ======== ======== ======== DATARAM CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands) (Unaudited) October 31, 2002 April 30, 2002 ________________ ______________ ASSETS Current assets: Cash and cash equivalents $ 2,591 $ 3,656 Trade receivables, net 6,881 12,177 Inventories 3,400 5,435 Other current assets 1,488 532 _________ _________ Total current assets 14,360 21,800 Property and equipment, net 7,460 9,210 Goodwill 11,144 11,144 Other assets 443 408 _________ _________ $ 33,407 $ 42,562 ========= ========= LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 2,518 6,600 Accrued liabilities 1,599 1,687 _________ _________ Total current liabilities 4,117 8,287 Deferred income taxes 646 647 Long-term debt 500 3,800 Stockholders' equity 28,144 29,828 _________ _________ $ 33,407 $ 42,562 ========= ========= The information provided in this press release may include forward-looking statements relating to future events, such as the development of new products, the commencement of production, or the future financial performance of the Company. Actual results may differ from such projections and are subject to certain risks including, without limitation, risks arising from: changes in the price of memory chips, changes in the demand for memory systems, increased competition in the memory systems industry, delays in developing and commercializing new products and other factors described in the Company's most recent Annual Report on Form 10-K, filed with the Securities and Exchange Commission, which can be reviewed at http://www.sec.gov.