Imation Cuts 4Q08 Outlook

Imation Corp. announced that the Company will not achieve its previous revenue or earnings outlook issued for the fourth quarter ending December 31st. Continued global economic and industry softness has resulted in a significant sales shortfall from internal projections across both commercial and consumer product lines.

“Global economic conditions have impacted our business more than we expected. In addition, the industry softness we have been seeing throughout the year has continued to negatively impact our results,” said Imation President and CEO Frank Russomanno.

While results are not finalized, the Company is likely to report revenue in the range of $530 million to $540 million for the fourth quarter. Driven by these revenue levels and margin pressures, the Company clearly will not meet its prior earnings outlook and could report a fourth quarter operating loss of up to $7 million before restructuring and other charges. In addition, the Company is currently finalizing its impairment testing on intangible assets including goodwill and it is likely that substantial impairments will be identified and recorded in the fourth quarter of 2008.

On October 21, 2008, Imation issued an outlook for the fourth quarter for revenue between $560 million and $580 million, operating income between $7 million and $14 million, and earnings per share between $0.11 and $0.23, prior to any restructuring charges.

“We are continuing the cost reduction actions announced last quarter as we accelerate our transformation of the Company’s business model. We remain focused on implementing our strategy of creating a brand and product management company in both commercial and consumer markets across data storage media, audio/video consumer electronics products, and accessories,” Russomanno concluded.