-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WeGSl1NlEXn/HZ1fDYLq2BUq52cIQE2iQ7PNB+oMvMbEA3r4Jex+cSEd5mhz0udF yG+Zp5nfCUCszAyqtSWapg== 0000950137-06-008186.txt : 20060727 0000950137-06-008186.hdr.sgml : 20060727 20060727163607 ACCESSION NUMBER: 0000950137-06-008186 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060727 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060727 DATE AS OF CHANGE: 20060727 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PC TEL INC CENTRAL INDEX KEY: 0001057083 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROGRAMMING, DATA PROCESSING, ETC. [7370] IRS NUMBER: 770364943 STATE OF INCORPORATION: DE FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-27115 FILM NUMBER: 06984888 BUSINESS ADDRESS: STREET 1: 8725 W. HIGGINS RD. STREET 2: SUITE 400 CITY: CHICAGO STATE: IL ZIP: 60631 BUSINESS PHONE: 773-243-3000 MAIL ADDRESS: STREET 1: 8725 W. HIGGINS RD STREET 2: SUITE 400 CITY: CHICAGO STATE: IL ZIP: 60631 8-K 1 c07132e8vk.txt CURRENT REPORT ================================================================================ 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 JULY 27, 2006 DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED) PCTEL, INC. (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER) DELAWARE 000-27115 77-0364943 (STATE OR OTHER JURISDICTION OF (COMMISSION FILE (IRS EMPLOYER INCORPORATION) NUMBER) IDENTIFICATION NUMBER)
8725 W. HIGGINS ROAD, SUITE 400 CHICAGO, ILLINOIS 60631 (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (773) 243-3000 (REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE) ________________________________________________________________________________ (FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT) 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): [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12(b) under the Exchange Act (17 CFR 240.14a-12(b)) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) ================================================================================ SECTION 2 - FINANCIAL INFORMATION ITEM 2.02 RESULTS OF OPERATIONS AND FINANCIAL CONDITION The following information is intended to be furnished under Item 2.02 of Form 8-K, "Results of Operations and Financial Condition." This information shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing. On July 27, 2006, PCTEL, Inc. issued a press release regarding its financial results for its second fiscal quarter ended June 30, 2006. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. SECTION 9 - FINANCIAL STATEMENTS AND EXHIBITS ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS (d) Exhibits The following exhibit is furnished herewith: 99.1 Press Release, dated July 27, 2006, of PCTEL, Inc. announcing its financial results for its second fiscal quarter ended June 30, 2006. -2- 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 hereunto duly authorized. Date: July 27, 2006 PCTEL, INC. By: /s/ John Schoen ------------------------------------ John W. Schoen, Chief Financial Officer -3- EXHIBIT INDEX
Exhibit Number Description - ------- ----------- 99.1 Press Release, dated July 27, 2006, of PCTEL, Inc. announcing its financial results for its second fiscal quarter ended June 30, 2006.
-4- EX-99.1 2 c07132exv99w1.txt PRESS RELEASE Exhibit 99.1 FOR IMMEDIATE RELEASE For further information contact: John Schoen Jack Seller COO/CFO Public Relations PCTEL, Inc. PCTEL, Inc. (773) 243-3000 (773) 243-3016 JACK.SELLER@PCTEL.COM PCTEL POSTS $26.8 MILLION IN REVENUE 46 PERCENT INCREASE INCLUDES $7 MILLION FROM PATENT DISPUTE RESOLUTION- HIGH MARGIN SOFTWARE AND SCANNER SALES UP 45 PERCENT CHICAGO, JULY 27, 2006 -- PCTEL, Inc. (NASDAQ: PCTI), a leader in wireless broadband solutions, announced results for the second quarter ended June 30, 2006. Financial highlights of the quarter were: - $26.8 MILLION in revenue for the quarter, an INCREASE OF 46 percent over the same period last year. Most of the increase - $7 million - reflects the resolution of PCTEL's intellectual property dispute with Agere. Revenue from product operations was up 8 percent over the same period last year. - $12.8 MILLION in revenue for the quarter from the Antenna Products Group. This is a DECREASE OF 5 percent over the second quarter last year. Revenue for the six months ended June 30, 2006 was up 6 percent from the same period a year ago. Results were unfavorably impacted by the termination of the SDARS (satellite radio antennas for retail outlets) late last year, but favorably impacted by the acquisition of the iVET(TM) product line during the third quarter of 2005. - $2.7 MILLION in revenue for the quarter from the Mobility Solutions Group. This is an INCREASE OF 104 percent over the second quarter last year. Revenue for the six months ended June 30, 2006 was up 97 percent from the same period a year ago. - $4.0 MILLION in revenue for the quarter from the RF Solutions Group. This is a 21 PERCENT INCREASE over the second quarter of last year. Revenue for the six months ended June 30, 2006 is also up 21 percent from the same period a year ago. - $7.4 MILLION in licensing revenue for the quarter, an increase of $7.1 million from the second quarter last year. Again, this sharp increase includes the aforementioned patent dispute resolution. - $1.3 MILLION GAIN ON RESTRUCTURING related to the closure of the Company's Dublin Factory and the termination of the local pension plan there. - GAAP NET INCOME OF $6.3 MILLION FOR THE QUARTER, OR $0.29 PER DILUTED SHARE, compared to $(0.3) million net loss, or $(0.02) per share for the same period in 2005. - NON-GAAP NET INCOME OF $8.4 MILLION FOR THE QUARTER, OR $0.39 PER DILUTED SHARE compared to $1.5 million of net income, or $0.07 per share for the same period in 2005. The Company's reporting of non-GAAP income excludes non-cash based expenses for stock compensation and amortization of intangible assets related to the Company's acquisitions. Those expenses were $2.1 million in the second quarter 2006 compared to $1.8 million for the same period a year ago. - $63.8 MILLION OF CASH at June 30, 2006. "THE PAST QUARTER HAS BEEN ONE OF SIGNIFICANT ACCOMPLISHMENT FOR PCTEL," SAID MARTY SINGER, PCTEL'S CHAIRMAN AND CEO. "DURING THE QUARTER, WE RESOLVED A LONG-STANDING PATENT DISPUTE, KEPT ON SCHEDULE OUR TRANSITION TO A CONTRACT MANUFACTURER FOR THE IVET(TM) PRODUCT LINE, ACHIEVED RECORD REVENUES FOR OUR MOBILITY SOLUTIONS GROUP, CONTINUED TO AGGRESSIVELY GROW OUR SCANNER BUSINESS, AND INTRODUCED SEVERAL NEW WIMAX ANTENNAS. WE ARE POISED FOR A STRONG SECOND HALF AND A STRONGER 2007," ADDED SINGER. PCTEL's management team will discuss the company's results during its scheduled earnings teleconference today at 6:15 PM EDT. CONFERENCE CALL / WEBCAST The company will hold a conference call at 6:15 PM EDT (5:15 PM CDT) today, Thursday, July 27, 2006 with Marty Singer, Chairman and Chief Executive Officer, and John Schoen, Chief Financial Officer. PCTEL will not be responding to inquiries regarding its financial results until the conference call. The session can be accessed by calling (800) 289-0508 (U.S. / Canada) or (913) 981-5550 (international). To listen via the Internet, please visit, www.pctel.com, or http://investor.pctel.com/eventdetail.cfm?eventid=28080 REPLAY: A replay will be available for two weeks after the call on PCTEL's web site at www.pctel.com or by calling (888) 203-1112 (U.S. / Canada) or (719) 457-0820 (international) access code: 5652483. ABOUT PCTEL PCTEL, Inc. (Nasdaq: PCTI), which is headquartered in Chicago, is a global leader in wireless broadband solutions. PCTEL's Antenna Products Group (http://antenna.pctel.com) designs, distributes, and supports innovative antenna solutions for public safety applications, unlicensed and licensed wireless broadband, fleet management, network timing, and other GPS applications. PCTEL's Mobility Solutions' (http://mobilitysolutions.pctel.com) software tools provide secure, access independent, remote connectivity to the Internet and VoIP capability for converged handsets. PCTEL's RF Solutions' (http://rfsolutions.pctel.com) portfolio of OEM receivers, receiver based products and interference management solutions are used to measure, monitor and optimize cellular networks. PCTEL protects its leadership position with a portfolio of more than 130 analog and broadband communications, wireless and antenna patents, issued or pending. The company's products are sold or licensed to wireless carriers, wireless ISPs, distributors, system integrators, wireless test and measurement companies, wireless network equipment and handset manufacturers, PC card manufacturers and government agencies. For more information, please visit the company's web site at: http://www.pctel.com. PCTEL SAFE HARBOR STATEMENT This press release contains "forward-looking statements" as defined in the Private Securities Litigation Reform Act of 1995. Specifically, the statements regarding PCTEL's expectations regarding the future growth of its broadband wireless products, the discontinuance of the manufacturing operations in Dublin, Ireland, and the outsource of the manufacture of certain antenna product lines are forward looking statements within the meaning of the safe harbor. These statements are based on management's current expectations and actual results may differ materially from those projected as a result of certain risks and uncertainties, including the ability to successfully grow the wireless products business, the ability to implement new technologies and obtain protection for the related intellectual property, the ability to realize product and manufacturing efficiencies, the ability to achieve reductions in costs as a result of the discontinuance of manufacturing operations and relocation or outsourcing of certain antenna products. These and other risks and uncertainties are detailed in PCTEL's Securities and Exchange Commission filings. These forward-looking statements are made only as of the date hereof, and PCTEL disclaims any obligation to update or revise the information contained in any forward-looking statement, whether as a result of new information, future events or otherwise. PCTEL, INC. CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED, IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
Three Months Six Months Ended Ended June 30, June 30, ----------------- ----------------- 2006 2005 2006 2005 ------- ------- ------- ------- REVENUES $26,758 $18,313 $45,324 $33,320 COST OF REVENUES 9,702 9,609 19,546 17,178 ------- ------- ------- ------- GROSS PROFIT 17,056 8,704 25,778 16,142 ------- ------- ------- ------- OPERATING EXPENSES: Research and development 3,336 2,434 6,253 4,905 Sales and marketing 3,196 2,934 6,738 6,048 General and administrative 3,725 3,865 7,473 8,031 Amortization of other intangible assets 1,056 854 2,093 1,737 Restructuring benefit (1,269) (70) (716) (70) Gain on sale of assets and related royalties (250) (500) (500) (1,000) ------- ------- ------- ------- Total operating expenses 9,794 9,517 21,341 19,651 ------- ------- ------- ------- INCOME (LOSS) FROM OPERATIONS 7,262 (813) 4,437 (3,509) OTHER INCOME, NET 747 431 1,368 970 ------- ------- ------- ------- INCOME (LOSS) BEFORE INCOME TAXES 8,009 (382) 5,805 (2,539) PROVISION (BENEFIT) FOR INCOME TAXES 1,683 (60) 1,676 101 ------- ------- ------- ------- NET INCOME (LOSS) $ 6,326 $ (322) $ 4,129 $(2,640) ======= ======= ======= ======= Basic income (loss) per share $ 0.30 $ (0.02) $ 0.20 $ (0.13) Shares used in computing basic income (loss) per share 20,837 20,108 20,656 20,014 Diluted income (loss) per share $ 0.29 $ (0.02) $ 0.19 $ (0.13) Shares used in computing diluted income (loss) per share 21,586 20,108 21,371 20,014
PCTEL INC. CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED, IN THOUSANDS)
June 30, December 31, 2006 2005 -------- ------------ ASSETS CURRENT ASSETS: Cash and cash equivalents $ 63,611 $ 58,307 Restricted cash 208 208 Accounts receivable, net 19,367 13,725 Inventories, net 8,652 9,547 Prepaid expenses and other assets 2,221 3,109 -------- -------- Total current assets 94,059 84,896 PROPERTY AND EQUIPMENT, net 11,603 11,190 GOODWILL 32,327 31,020 OTHER INTANGIBLE ASSETS, net 15,009 16,457 OTHER ASSETS 1,807 941 -------- -------- TOTAL ASSETS $154,805 $144,504 ======== ======== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable 1,874 2,251 Income taxes payable 5,721 5,297 Deferred revenue 1,814 1,944 Accrued liabilities 6,964 5,595 Short Term Debt 959 -- -------- -------- Total current liabilities 17,332 15,087 Pension liabilities -- 3,046 LONG-TERM LIABILITIES 2,623 2,344 -------- -------- Total liabilities 19,955 20,477 -------- -------- STOCKHOLDERS' EQUITY: Common stock 22 22 Additional paid-in capital 165,555 160,825 Accumulated deficit (32,523) (36,652) Accumulated other comprehensive income 1,796 (168) -------- -------- Total stockholders' equity 134,850 124,027 -------- -------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $154,805 $144,504 ======== ========
PCTEL, INC. REVENUE & GROSS PROFIT BY SEGMENT (UNAUDITED, IN THOUSANDS)
Three Months Ended Six Months Ended June 30, June 30, ------------------ ----------------- 2006 2005 2006 2005 -------- ------- ------- ------- REVENUES: APG $12,753 $13,385 $25,141 $23,705 RFS 3,990 3,299 7,697 6,382 MSG 2,668 1,311 4,784 2,433 LICENSING 7,382 331 7,772 823 Eliminations (35) (13) (70) (23) ------- ------- ------- ------- TOTAL REVENUES 26,758 18,313 45,324 33,320 GROSS PROFIT: APG $ 4,189 $ 4,840 $ 7,859 $ 8,386 RFS 2,834 2,262 5,403 4,590 MSG 2,653 1,273 4,755 2,354 LICENSING 7,379 329 7,764 816 Eliminations 1 -- (3) (4) ------- ------- ------- ------- TOTAL GROSS PROFIT 17,056 8,704 25,778 16,142
PCTEL, INC. RECONCILIATION OF NON-GAAP TO GAAP REVENUE & GROSS PROFIT BY SEGMENT (UNAUDITED, IN THOUSANDS)
Three Months Ended June 30, 2006 Three Months Ended June 30, 2005 ----------------------------------- ---------------------------------- As Non-GAAP Non As Non-GAAP Non Reported Adjustments(a) GAAP Reported Adjustments(a) GAAP -------- --------------- ------ -------- -------------- ------ REVENUES: APG 12,753 12,753 13,385 13,385 RFS 3,990 3,990 3,299 3,299 MSG 2,668 2,668 1,311 1,311 LICENSING 7,382 7,382 331 331 Eliminations (35) (35) (13) (13) ------ ------ ------ ------ TOTAL REVENUES 26,758 26,758 18,313 18,313 ====== ====== ====== ====== GROSS PROFIT: APG 4,189 (48)(b) 4,237 4,840 (4)(b) 4,844 RFS 2,834 (38)(b) 2,872 2,262 (2)(b) 2,264 MSG 2,653 2,653 1,273 1,273 LICENSING 7,379 7,379 329 329 Eliminations 1 1 -- -- ------ --- ------ ------ --- ------ TOTAL GROSS PROFIT 17,056 (86) 17,142 8,704 (6) 8,710 ====== === ====== ====== === ======
(a) These adjustments reconcile the Company's GAAP gross profit to its non-GAAP gross profit. The Company believes that presentation of results excluding non-cash share-based compensation provides meaningful supplemental information to both management and investors that is indicative of the Company's core operating results and facilitates comparison of gross profit across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company's GAAP results. (b) This adjustment reflects the non cash stock based compensation expense for restricted stock grants and stock bonuses awarded to the Company's employees. The adjustment for the three months ended June 30, 2006 also includes non cash stock based compensation expense for stock options in accordance with SFAS No. 123R. PCTEL, INC. RECONCILIATION OF NON-GAAP TO GAAP REVENUE & GROSS PROFIT BY SEGMENT (UNAUDITED, IN THOUSANDS)
Six Months Ended June 30, 2006 Six Months Ended June 30, 2005 ----------------------------------- ---------------------------------- As Non-GAAP Non As Non-GAAP Non Reported Adjustments(a) GAAP Reported Adjustments(a) GAAP -------- --------------- ------ -------- -------------- ------ REVENUES: APG 25,141 25,141 23,705 23,705 RFS 7,697 7,697 6,382 6,382 MSG 4,784 4,784 2,433 2,433 LICENSING 7,772 7,772 823 823 Eliminations (70) (70) (23) (23) ------ ------ ------ ------ TOTAL REVENUES 45,324 45,324 33,320 33,320 ====== ====== ====== ====== GROSS PROFIT: APG 7,859 (92)(b) 7,951 8,386 (5)(b) 8,391 RFS 5,403 (71)(b) 5,474 4,590 (2)(b) 4,592 MSG 4,755 4,755 2,354 2,354 LICENSING 7,764 7,764 816 816 Eliminations (3) (3) (4) (4) ------ ---- ------ ------ --- ------ TOTAL GROSS PROFIT 25,778 (163) 25,941 16,142 (7) 16,149 ====== ==== ====== ====== === ======
(a) These adjustments reconcile the Company's GAAP gross profit to its non-GAAP gross profit. The Company believes that presentation of results excluding non-cash share-based compensation provides meaningful supplemental information to both management and investors that is indicative of the Company's core operating results and facilitates comparison of gross profit across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company's GAAP results. (b) This adjustment reflects the non cash stock based compensation expense for restricted stock grants and stock bonuses awarded to the Company's employees. The adjustment for the six months ended June 30, 2006 also includes non cash stock based compensation expense for stock options in accordance with SFAS No. 123R. PCTEL, INC. RECONCILIATION OF NON GAAP TO GAAP RESULTS OF OPERATIONS (A) (UNAUDITED, IN THOUSANDS)
Three Months Ended June 30, 2006 Three Months Ended June 30, 2005 ------------------------------------ ------------------------------------ As Non-GAAP Non As Non-GAAP Non Reported Adjustments (a) GAAP Reported Adjustments (a) GAAP -------- --------------- ------- -------- --------------- ------- REVENUES $26,758 $26,758 $18,313 $18,313 COST OF REVENUES 9,702 (86)(b) 9,616 9,609 (6) 9,603 ------- ------- ------- ------- ------- ------- GROSS PROFIT 17,056 86 17,142 8,704 6 8,710 OPERATING EXPENSES: Research and development 3,336 (161)(b) 3,175 2,434 (70)(b) 2,364 Sales and marketing 3,196 (215)(b) 2,981 2,934 (183)(b) 2,751 General and administrative 3,725 (603)(b) 3,122 3,865 (663)(b) 3,202 Amortization of other intangible assets 1,056 (1,056) -- 854 (854) -- Restructuring benefit (1,269) (1,269) (70) (70) Gain on sale of assets and related royalties (250) (250) (500) (500) ------- ------- ------- ------- ------- ------- Total operating expenses 9,794 (2,035) 7,759 9,517 (1,770) 7,747 ------- ------- ------- ------- ------- ------- INCOME (LOSS) FROM OPERATIONS 7,262 2,121 9,383 (813) 1,776 963 OTHER INCOME, NET 747 747 431 431 ------- ------- ------- ------- ------- ------- INCOME (LOSS) BEFORE INCOME TAXES 8,009 2,121 10,130 (382) 1,776 1,394 PROVISION (BENEFIT) FOR INCOME TAXES 1,683 1,683 (60) (60) ------- ------- ------- ------- ------- ------- NET INCOME (LOSS) $ 6,326 $ 2,121 $ 8,447 $ (322) $ 1,776 $ 1,454 ======= ======= ======= ======= ======= ======= Earnings (loss) per share Basic $ 0.30 $ 0.41 $ (0.02) $ 0.07 Diluted $ 0.29 $ 0.39 $ (0.02) $ 0.07 Shares used in computing EPS (in thousands) Basic 20,837 20,837 20,108 20,108 Diluted 21,586 21,586 20,108 20,200
(a) These adjustments reconcile the Company's GAAP results of operations to its non-GAAP results of operations. The Company believes that presentation of results excluding items such as non-cash share-based compensation and amortization of intangible assets provides meaningful supplemental information to both management and investors that is indicative of the Company's core operating results and facilitates comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company's GAAP results. (b) This adjustment reflects the non cash stock based compensation expense for restricted stock grants and stock bonuses awarded to the Company's employees. The adjustment for the three months ended June 30, 2006 also includes non cash stock based compensation expense for stock options in accordance with SFAS No. 123R. PCTEL, INC. RECONCILIATION OF NON GAAP TO GAAP RESULTS OF OPERATIONS (A) (UNAUDITED, IN THOUSANDS)
Six Months Ended June 30, 2006 Six Months Ended June 30, 2005 ------------------------------------ ------------------------------------ As Non-GAAP Non As Non-GAAP Non Reported Adjustments (a) GAAP Reported Adjustments (a) GAAP -------- --------------- ------- -------- --------------- ------- REVENUES $45,324 $45,324 $ 33,320 $33,320 COST OF REVENUES 19,546 (163)(b) 19,383 17,178 (7) 17,171 ------- ------ ------- -------- ------- ------- GROSS PROFIT 25,778 163 25,941 16,142 7 16,149 OPERATING EXPENSES: Research and development 6,253 (306)(b) 5,947 4,905 (120)(b) 4,785 Sales and marketing 6,738 (439)(b) 6,299 6,048 (315)(b) 5,733 General and administrative 7,473 (1,307)(b) 6,166 8,031 (1,140)(b) 6,891 Amortization of other intangible assets 2,093 (2,093) -- 1,737 (1,737) -- Restructuring benefit (716) (716) (70) (70) Gain on sale of assets and related royalties (500) (500) (1,000) (1,000) ------- ------ ------- -------- ------- ------- Total operating expenses 21,341 (4,145) 17,196 19,651 (3,312) 16,339 ------- ------ ------- -------- ------- ------- INCOME (LOSS) FROM OPERATIONS 4,437 4,308 8,745 (3,509) 3,319 (190) OTHER INCOME, NET 1,368 1,368 970 970 ------- ------ ------- -------- ------- ------- INCOME (LOSS) BEFORE INCOME TAXES 5,805 4,308 10,113 (2,539) 3,319 780 PROVISION FOR INCOME TAXES 1,676 1,676 101 101 ------- ------ ------- -------- ------- ------- NET INCOME (LOSS) $ 4,129 $4,308 $ 8,437 $ (2,640) $ 3,319 $ 679 ======= ====== ======= ======== ======= ======= Earnings (loss) per share Basic $ 0.20 $ 0.41 $ (0.13) $ 0.03 Diluted $ 0.19 $ 0.39 $ (0.13) $ 0.03 Shares used in computing EPS (in thousands) Basic 20,656 20,656 20,014 20,014 Diluted 21,371 21,371 20,014 20,357
(a) These adjustments reconcile the Company's GAAP results of operations to its non-GAAP results of operations. The Company believes that presentation of results excluding items such as non-cash share-based compensation and amortization of intangible assets provides meaningful supplemental information to both management and investors that is indicative of the Company's core operating results and facilitates comparison of operating results across reporting periods. The Company uses these non-GAAP measures when evaluating its financial results as well as for internal planning and forecasting purposes. These non-GAAP measures should not be viewed as a substitute for the Company's GAAP results. (b) This adjustment reflects the non cash stock based compensation expense for restricted stock grants and stock bonuses awarded to the Company's employees. The adjustment for the six months ended June 30, 2006 also includes non cash stock based compensation expense for stock options in accordance with SFAS No. 123R. -----END PRIVACY-ENHANCED MESSAGE-----