Imation Outlines 'Four Pillars of Storage' Strategy at Analyst and Investor Forum

NEW YORK, Nov. 15 /PRNewswire-FirstCall/ -- Imation Corp , a worldwide leader in removable data storage media, laid out its competitive strengths across the four pillars of storage before financial analysts and investors in New York City. (A web cast of the presentations is available at http://ir.imation.com/ or http://www.streetevents.com/ .)

"Imation has the broadest product portfolio of removable data storage media," said Bruce Henderson, Imation's chairman and chief executive officer. "Our offerings span magnetic, optical, solid state flash and removable hard drives -- the four pillars of storage. No other company has such a broad offering of media across major market sectors, technology platforms, and applications. In addition, our industry leadership for more than 50 years, broad market coverage and global footprint, singular focus on data storage, deep technology and intellectual property portfolio and solid financial position provide a strong foundation on which to build our momentum.

"With the need for storage capacity growing dramatically, Imation is poised, we believe better than our competitors, to take advantage of this growth. The whole industry will ship in excess of 20,000 petabytes* of data storage capacity across magnetic, optical and USB flash memory this year, up nearly 40 percent from 2004. Storage capacity is expected to continue to grow at double digit rates through the end of this decade and beyond," Henderson added. "With our market position, we believe we will continue to gain market share in the overall portion of storage capacity shipped. We also will continue to invest in developing the technologies necessary to meet future demand for storage media across business and consumer applications."

Highlights of the half day meeting included presentations from the following executives:

Bruce A Henderson; Chairman and Chief Executive Officer Frank Russomanno; Executive Vice President and Chief Operating Officer Paul Zeller; Vice President and Chief Financial Officer Dr. Richard Weiss; Vice President, Research and Development Dr. Subodh Kulkarni; Executive Director; Research and Development James Ellis; General Manager, Global Product Strategy

* A petabyte is 10 to the 15th bytes (a one followed by 15 zeroes), or a thousand Terabytes. One Terabyte would be roughly equivalent to a library holding 1 million books. So in 2005, the total storage capacity shipped on blank removable media was approximately equivalent to 20 million libraries each holding a million books. (Source: University of California, Imation)

Business Outlook

The Company reiterated its business outlook for the fourth quarter and full year, ended December 31, 2005, as described below. The basis of the Company's business outlook for the fourth quarter and full year is subject to the risks and uncertainties described below.

-- Total company revenue for the fourth quarter is targeted to be flat to up four percent versus Q4 2004, to a range of $315 million to $330 million. This represents full year revenue growth of five to six percent for 2005, up from previous guidance of three to five percent growth. -- Operating income for the fourth quarter is targeted between $23 million and $25 million, resulting in full year 2005 operating income between $102 million and $104 million. The Company's previous guidance was $93 million to $98 million. The Company's operating income of $44.6 million in 2004 included charges of $25.2 million from restructuring and other items. Thus, full year 2005 operating income is estimated to grow between 46 and 49 percent over the $69.8 million in 2004 as adjusted to eliminate the 2004 restructuring and other items. -- Fully diluted E.P.S. from continuing operations in the fourth quarter is targeted between $0.44 and $0.48. For the full year, fully diluted E.P.S. from continuing operations is now targeted between $2.28 and $2.32, up from previous guidance of $2.10 to $2.17. As a reminder, in Q1 2005 the Company recorded a $0.35 per share benefit from a favorable tax ruling, which is included in the full year E.P.S. targets cited above. -- Capital spending for 2005 is targeted in the range of $20 million to $25 million, down from previous guidance of $25 million to $30 million. -- Depreciation and amortization for 2005 remains targeted at $40 million. About Imation

Imation Corp is a leading developer, manufacturer and supplier of magnetic and optical removable data storage media. For more information, go to http://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 the Company's actual results in the future to differ materially from its historical results and those presently anticipated or projected. The Company wishes to caution investors not to place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update such statement to reflect events or circumstances arising after such date. Among these factors are continuing uncertainty in global economic conditions that make it particularly difficult to predict product demand, the Company's ability to meet its cost reduction and revenue growth targets, its ability to introduce new offerings in a timely manner either independently or in association with OEMs or other third parties, its ability to achieve the expected benefits in a timely manner from the Moser Baer and other strategic relationships, including the Global Data Media joint venture, the competitive pricing environment, foreign currency fluctuations, the outcome of litigation, its ability to secure adequate supply of certain high demand products, the ready availability and price of energy, availability and price of key raw materials or critical components, including polycarbonate resins, the market acceptance of newly introduced product and service offerings, the rate of decline for certain existing products as well as various factors set forth, from time to time, in the Company's filings with the Securities and Exchange Commission.