x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Massachusetts
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04-2441294
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(State of incorporation)
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(I.R.S. Employer Identification No.)
|
Large accelerated filer
|
¨
|
Accelerated filer
|
¨
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Non-accelerated filer
|
¨ (Do not check if a smaller reporting company)
|
Smaller reporting company
|
x
|
Page
|
||||
PART I. FINANCIAL INFORMATION
|
||||
Item 1.
|
Financial Statements
|
|||
Consolidated Balance Sheets as of June 30, 2011 (unaudited) and September 30, 2010
|
3
|
|||
Consolidated Statements of Operations (unaudited) for the three and nine months ended June 30, 2011 and 2010
|
4
|
|||
Consolidated Statement of Shareholders’ Equity (unaudited) for the nine months ended June 30, 2011
|
5
|
|||
Consolidated Statements of Cash Flows (unaudited) for the nine months ended June 30, 2011 and 2010
|
6
|
|||
Notes to Consolidated Financial Statements (unaudited)
|
7-12
|
|||
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
12-23
|
||
Item 4.
|
Controls and Procedures
|
24
|
||
PART II. OTHER INFORMATION
|
||||
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
25
|
||
Item 6.
|
Exhibits
|
26
|
June 30,
2011
|
September 30,
2010
|
|||||||
(Unaudited)
|
||||||||
ASSETS
|
||||||||
Current assets:
|
||||||||
Cash and cash equivalents
|
$ | 17,482 | $ | 15,531 | ||||
Accounts receivable, net of allowances of $277 and $288
|
10,318 | 12,190 | ||||||
Inventories
|
5,586 | 5,862 | ||||||
Refundable income taxes
|
334 | 721 | ||||||
Deferred income taxes
|
126 | 124 | ||||||
Other current assets
|
2,054 | 1,523 | ||||||
Total current assets
|
35,900 | 35,951 | ||||||
Property, equipment and improvements, net
|
873 | 873 | ||||||
Other assets:
|
||||||||
Intangibles, net
|
602 | 687 | ||||||
Deferred income taxes
|
918 | 880 | ||||||
Cash surrender value of life insurance
|
2,888 | 2,689 | ||||||
Other assets
|
249 | 299 | ||||||
Total other assets
|
4,657 | 4,555 | ||||||
Total assets
|
$ | 41,430 | $ | 41,379 | ||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Current liabilities:
|
||||||||
Accounts payable and accrued expenses
|
$ | 8,978 | $ | 10,049 | ||||
Deferred revenue
|
3,348 | 3,078 | ||||||
Pension and retirement plans
|
708 | 441 | ||||||
Income taxes payable
|
239 | 380 | ||||||
Total current liabilities
|
13,273 | 13,948 | ||||||
Pension and retirement plans
|
9,010 | 8,928 | ||||||
Capital lease obligation
|
25 | 24 | ||||||
Other long term liabilities
|
271 | - | ||||||
Total liabilities
|
22,579 | 22,900 | ||||||
Commitments and contingencies
|
||||||||
Shareholders’ equity:
|
||||||||
Common stock, $.01 par; authorized, 7,500 shares; issued and outstanding 3,473 and 3,520 shares, respectively
|
35 | 35 | ||||||
Additional paid-in capital
|
11,035 | 11,280 | ||||||
Retained earnings
|
12,977 | 12,516 | ||||||
Accumulated other comprehensive loss
|
(5,196 | ) | (5,352 | ) | ||||
Total shareholders’ equity
|
18,851 | 18,479 | ||||||
Total liabilities and shareholders’ equity
|
$ | 41,430 | $ | 41,379 |
For the three months ended
|
For the nine months ended
|
|||||||||||||||
June 30,
2011
|
June 30,
2010
|
June 30,
2011
|
June 30,
2010
|
|||||||||||||
Sales:
|
||||||||||||||||
Product
|
$ | 16,416 | $ | 23,753 | $ | 49,566 | $ | 59,549 | ||||||||
Services
|
3,265 | 4,815 | 11,434 | 11,601 | ||||||||||||
Total sales
|
19,681 | 28,568 | 61,000 | 71,150 | ||||||||||||
Cost of sales:
|
||||||||||||||||
Product
|
13,690 | 21,153 | 41,440 | 50,729 | ||||||||||||
Services
|
2,370 | 2,519 | 7,162 | 7,731 | ||||||||||||
Total cost of sales
|
16,060 | 23,672 | 48,602 | 58,460 | ||||||||||||
Gross profit
|
3,621 | 4,896 | 12,398 | 12,690 | ||||||||||||
Operating expenses:
|
||||||||||||||||
Engineering and development
|
442 | 498 | 1,460 | 1,401 | ||||||||||||
Selling, general and administrative
|
3,450 | 3,740 | 10,135 | 10,207 | ||||||||||||
Total operating expenses
|
3,892 | 4,238 | 11,595 | 11,608 | ||||||||||||
Operating income (loss)
|
(271 | ) | 658 | 803 | 1,082 | |||||||||||
Other income (expense):
|
||||||||||||||||
Foreign exchange gain (loss)
|
(9 | ) | (6 | ) | - | (16 | ) | |||||||||
Other income (expense), net
|
(24 | ) | (4 | ) | (55 | ) | (30 | ) | ||||||||
Net other income (expense)
|
(33 | ) | (10 | ) | (55 | ) | (46 | ) | ||||||||
Income (loss) before income taxes
|
(304 | ) | 648 | 748 | 1,036 | |||||||||||
Income tax expense (benefit)
|
(90 | ) | 27 | 287 | 168 | |||||||||||
Net income (loss)
|
$ | (214 | ) | $ | 621 | $ | 461 | $ | 868 | |||||||
Net income (loss) attributable to common shareholders
|
$ | (211 | ) | $ | 614 | $ | 455 | $ | 860 | |||||||
Net income (loss) per share – basic
|
$ | (0.06 | ) | $ | 0.17 | $ | 0.13 | $ | 0.24 | |||||||
Weighted average shares outstanding – basic
|
3,428 | 3,548 | 3,446 | 3,545 | ||||||||||||
Net income (loss) per share – diluted
|
$ | (0.06 | ) | $ | 0.17 | $ | 0.13 | $ | 0.24 | |||||||
Weighted average shares outstanding – diluted
|
3,428 | 3,574 | 3,485 | 3,574 |
Shares
|
Amount
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Accumulated
other
comprehensive
loss
|
Total
Shareholders’
Equity
|
Comprehensive
Income
|
||||||||||||||||||||||
Balance as of September 30, 2010
|
3,520 | $ | 35 | $ | 11,280 | $ | 12,516 | $ | (5,352 | ) | $ | 18,479 | ||||||||||||||||
Comprehensive income (loss):
|
||||||||||||||||||||||||||||
Net income
|
— | — | — | 461 | — | 461 | $ | 461 | ||||||||||||||||||||
Other comprehensive income:
|
||||||||||||||||||||||||||||
Effect of foreign currency translation
|
— | — | — | — | 156 | 156 | 156 | |||||||||||||||||||||
Total comprehensive income
|
$ | 617 | ||||||||||||||||||||||||||
Stock-based compensation
|
— | — | 54 | — | — | 54 | ||||||||||||||||||||||
Issuance of shares under employee stock purchase plan
|
25 | — | 74 | — | — | 74 | ||||||||||||||||||||||
Restricted stock shares issued
|
37 | 1 | 74 | — | — | 75 | ||||||||||||||||||||||
Purchase of common stock
|
(109 | ) | (1 | ) | (447 | ) | — | — | (448 | ) | ||||||||||||||||||
Balance as of June 30, 2011
|
3,473 | $ | 35 | $ | 11,035 | $ | 12,977 | $ | (5,196 | ) | $ | 18,851 |
For the nine months ended
|
||||||||
June 30,
2011
|
June 30,
2010
|
|||||||
Cash flows from operating activities:
|
||||||||
Net income
|
$ | 461 | $ | 868 | ||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
277 | 295 | ||||||
Amortization of intangibles
|
85 | 85 | ||||||
Loss on disposal of fixed assets, net
|
3 | 1 | ||||||
Foreign exchange loss (gain)
|
― | 16 | ||||||
Non-cash changes in accounts receivable
|
(12 | ) | 8 | |||||
Stock-based compensation expense on stock options and restricted stock awards
|
129 | 166 | ||||||
Deferred income taxes
|
― | (153 | ) | |||||
Increase in cash surrender value of life insurance
|
(59 | ) | (60 | ) | ||||
Changes in operating assets and liabilities:
|
||||||||
(Increase) decrease in accounts receivable
|
2,212 | (4,819 | ) | |||||
(Increase) decrease in inventories
|
295 | (1,281 | ) | |||||
(Increase) decrease in refundable income taxes
|
410 | (46 | ) | |||||
(Increase) decrease in other current assets
|
(449 | ) | 132 | |||||
Decrease in other assets
|
54 | 10 | ||||||
Increase (decrease) in accounts payable and accrued expenses
|
(1,322 | ) | 4,959 | |||||
Increase in deferred revenue
|
149 | 180 | ||||||
Increase in pension and retirement plans liability
|
58 | 159 | ||||||
Increase (decrease) in income taxes payable
|
(143 | ) | 252 | |||||
Increase (decrease) in other long term liabilities
|
271 | (309 | ) | |||||
Net cash provided by operating activities
|
2,419 | 463 | ||||||
Cash flows from investing activities:
|
||||||||
Purchase of investments
|
- | (1,100 | ) | |||||
Life insurance premiums paid
|
(140 | ) | (121 | ) | ||||
Purchases of property, equipment and improvements
|
(249 | ) | (288 | ) | ||||
Net cash used in investing activities
|
(389 | ) | (1,509 | ) | ||||
Cash flows from financing activities:
|
||||||||
Proceeds from issuance of shares under employee stock purchase plan
|
74 | 113 | ||||||
Purchase of common stock
|
(448 | ) | (122 | ) | ||||
Net cash used in financing activities
|
(374 | ) | (9 | ) | ||||
Effects of exchange rate on cash
|
295 | (1,143 | ) | |||||
Net increase (decrease) in cash and cash equivalents
|
1,951 | (2,198 | ) | |||||
Cash and cash equivalents, beginning of period
|
15,531 | 18,904 | ||||||
Cash and cash equivalents, end of period
|
$ | 17,482 | $ | 16,706 | ||||
Supplementary cash flow information:
|
||||||||
Cash paid for income taxes
|
$ | 267 | $ | 404 | ||||
Cash paid for interest
|
$ | 85 | $ | 89 |
1.
|
Basis of Presentation
|
2.
|
Use of Estimates
|
3.
|
Earnings Per Share of Common Stock
|
For the Three Months Ended
|
For the Nine Months Ended
|
|||||||||||||||
June 30,
2011
|
June 30,
2010
|
June 30,
2011
|
June 30,
2010
|
|||||||||||||
(Amounts in thousands, except per share data)
|
||||||||||||||||
Net income (loss)
|
$ | (214 | ) | $ | 621 | $ | 461 | $ | 868 | |||||||
Less: Net income (loss) attributable to nonvested common stock
|
(3 | ) | 7 | 6 | 8 | |||||||||||
Net income (loss) attributable to common stockholders
|
(211 | ) | 614 | 455 | 860 | |||||||||||
Weighted average total shares outstanding – basic
|
3,484 | 3,588 | 3,497 | 3,578 | ||||||||||||
Less: weighted average non-vested shares outstanding
|
(56 | ) | (40 | ) | (51 | ) | (33 | ) | ||||||||
Weighted average number of common shares outstanding – basic
|
3,428 | 3,548 | 3,446 | 3,545 | ||||||||||||
Potential common shares from non-vested stock awards and the assumed exercise of stock options
|
― | 26 | 39 | 29 | ||||||||||||
Weighted average common shares outstanding – diluted
|
3,428 | 3,574 | 3,485 | 3,574 | ||||||||||||
Net income (loss) per share – basic
|
$ | (0.06 | ) | $ | 0.17 | $ | 0.13 | $ | 0.24 | |||||||
Net income (loss) per share – diluted
|
$ | (0.06 | ) | $ | 0.17 | $ | 0.13 | $ | 0.24 |
June 30,
2011
|
September 30,
2010
|
|||||||
(Amounts in thousands)
|
||||||||
Raw materials
|
$ | 966 | $ | 1,029 | ||||
Work-in-process
|
948 | 439 | ||||||
Finished goods
|
3,672 | 4,394 | ||||||
Total
|
$ | 5,586 | $ | 5,862 |
5.
|
Accumulated Other Comprehensive Loss
|
For the Three Months Ended
|
For the Nine Months Ended
|
|||||||||||||||
June 30,
2011
|
June 30,
2010
|
June 30,
2011
|
June 30,
2010
|
|||||||||||||
(Amounts in thousands)
|
||||||||||||||||
Net income (loss)
|
$ | (214 | ) | $ | 621 | $ | 461 | $ | 868 | |||||||
Effect of foreign currency translation
|
115 | (297 | ) | 156 | (653 | ) | ||||||||||
Comprehensive income (loss)
|
$ | (99 | ) | $ | 324 | $ | 617 | $ | 215 |
June 30,
2011
|
September 30,
2010
|
|||||||
(Amounts in thousands)
|
||||||||
Cumulative effect of foreign currency translation
|
$ | (1,977 | ) | $ | (2,133 | ) | ||
Additional minimum pension liability
|
(3,219 | ) | (3,219 | ) | ||||
Accumulated Other Comprehensive Loss
|
$ | (5,196 | ) | $ | (5,352 | ) |
For the Three Months Ended June 30
|
||||||||||||||||||||||||
2011
|
2010
|
|||||||||||||||||||||||
Foreign
|
U.S.
|
Total
|
Foreign
|
U.S.
|
Total
|
|||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||||||
Pension:
|
||||||||||||||||||||||||
Service cost
|
$ | 18 | $ | 3 | $ | 21 | $ | 14 | $ | 2 | $ | 16 | ||||||||||||
Interest cost
|
176 | 25 | 201 | 159 | 29 | 188 | ||||||||||||||||||
Expected return on plan assets
|
(128 | ) | — | (128 | ) | (106 | ) | — | (106 | ) | ||||||||||||||
Amortization of:
|
||||||||||||||||||||||||
Prior service gain
|
— | — | — | — | — | — | ||||||||||||||||||
Amortization of net gain
|
18 | 7 | 25 | 10 | 8 | 18 | ||||||||||||||||||
Net periodic benefit cost
|
$ | 84 | $ | 35 | $ | 119 | $ | 77 | $ | 39 | $ | 116 | ||||||||||||
Post Retirement:
|
||||||||||||||||||||||||
Service cost
|
$ | — | $ | 5 | $ | 5 | $ | — | $ | 5 | $ | 5 | ||||||||||||
Interest cost
|
— | 17 | 17 | — | 17 | 17 | ||||||||||||||||||
Amortization of net gain
|
— | 12 | 12 | — | 16 | 16 | ||||||||||||||||||
Net periodic benefit cost
|
$ | — | $ | 34 | $ | 34 | $ | — | $ | 38 | $ | 38 |
For the Nine Months Ended June 30
|
||||||||||||||||||||||||
2011
|
2010
|
|||||||||||||||||||||||
Foreign
|
U.S.
|
Total
|
Foreign
|
U.S.
|
Total
|
|||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||||||
Pension:
|
||||||||||||||||||||||||
Service cost
|
$ | 54 | $ | 8 | $ | 62 | $ | 44 | $ | 7 | $ | 51 | ||||||||||||
Interest cost
|
518 | 74 | 592 | 504 | 87 | 591 | ||||||||||||||||||
Expected return on plan assets
|
(379 | ) | — | (379 | ) | (333 | ) | — | (333 | ) | ||||||||||||||
Amortization of:
|
||||||||||||||||||||||||
Prior service gain
|
— | — | — | — | — | — | ||||||||||||||||||
Amortization of net gain
|
52 | 23 | 75 | 33 | 22 | 55 | ||||||||||||||||||
Net periodic benefit cost
|
$ | 245 | $ | 105 | $ | 350 | $ | 248 | $ | 116 | $ | 364 | ||||||||||||
Post Retirement:
|
||||||||||||||||||||||||
Service cost
|
$ | — | $ | 15 | $ | 15 | $ | — | $ | 14 | $ | 14 | ||||||||||||
Interest cost
|
— | 51 | 51 | — | 52 | 52 | ||||||||||||||||||
Amortization of net gain
|
— | 35 | 35 | — | 48 | 48 | ||||||||||||||||||
Net periodic benefit cost
|
$ | — | $ | 101 | $ | 101 | $ | — | $ | 114 | $ | 114 |
7.
|
Segment Information
|
Service and System Integration Segment
|
||||||||||||||||||||||||
Three Months Ended June 30,
|
Systems
Segment
|
Germany
|
United
Kingdom
|
U.S.
|
Total
|
Consolidated
Total
|
||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||||||
2011
|
||||||||||||||||||||||||
Sales:
|
||||||||||||||||||||||||
Product
|
$ | 1,323 | $ | 3,996 | $ | 68 | $ | 11,029 | $ | 15,093 | $ | 16,416 | ||||||||||||
Service
|
152 | 2,151 | 347 | 615 | 3,113 | 3,265 | ||||||||||||||||||
Total sales
|
1,475 | 6,147 | 415 | 11,644 | 18,206 | 19,681 | ||||||||||||||||||
Profit (loss) from operations
|
(810 | ) | 63 | 15 | 461 | 539 | (271 | ) | ||||||||||||||||
Assets
|
12,508 | 13,699 | 3,890 | 11,333 | 28,922 | 41,430 | ||||||||||||||||||
Capital expenditures
|
10 | 12 | 9 | 7 | 28 | 38 | ||||||||||||||||||
Depreciation and amortization
|
24 | 46 | 7 | 46 | 99 | 123 | ||||||||||||||||||
2010
|
||||||||||||||||||||||||
Sales:
|
||||||||||||||||||||||||
Product
|
$ | 313 | $ | 2,801 | $ | - | $ | 20,639 | $ | 23,440 | $ | 23,753 | ||||||||||||
Service
|
1,741 | 1,787 | 356 | 931 | 3,074 | 4,815 | ||||||||||||||||||
Total sales
|
2,054 | 4,588 | 356 | 21,570 | 26,514 | 28,568 | ||||||||||||||||||
Profit (loss) from operations
|
55 | (159 | ) | (35 | ) | 797 | 603 | 658 | ||||||||||||||||
Assets
|
14,111 | 9,114 | 3,704 | 17,626 | 30,444 | 44,555 | ||||||||||||||||||
Capital expenditures
|
10 | 58 | 15 | 33 | 106 | 116 | ||||||||||||||||||
Depreciation and amortization
|
27 | 37 | 7 | 52 | 96 | 123 |
Service and System Integration Segment
|
||||||||||||||||||||||||
Nine Months Ended June 30,
|
Systems
Segment
|
Germany
|
United
Kingdom
|
U.S.
|
Total
|
Consolidated
Total
|
||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||||||
2011
|
||||||||||||||||||||||||
Sales:
|
||||||||||||||||||||||||
Product
|
$ | 3,563 | $ | 12,556 | $ | 140 | $ | 33,307 | $ | 46,003 | $ | 49,566 | ||||||||||||
Service
|
2,036 | 6,506 | 1,043 | 1,849 | 9,398 | 11,434 | ||||||||||||||||||
Total sales
|
5,599 | 19,062 | 1,183 | 35,156 | 55,401 | 61,000 | ||||||||||||||||||
Profit (loss) from operations
|
(624 | ) | 213 | - | 1,214 | 1,427 | 803 | |||||||||||||||||
Assets
|
12,508 | 13,699 | 3,890 | 11,333 | 28,922 | 41,430 | ||||||||||||||||||
Capital expenditures
|
142 | 59 | 12 | 36 | 107 | 249 | ||||||||||||||||||
Depreciation and amortization
|
66 | 138 | 21 | 137 | 296 | 362 | ||||||||||||||||||
2010
|
||||||||||||||||||||||||
Sales:
|
||||||||||||||||||||||||
Product
|
$ | 4,842 | $ | 10,500 | $ | 49 | $ | 44,158 | $ | 54,707 | $ | 59,549 | ||||||||||||
Service
|
2,234 | 6,282 | 1,201 | 1,884 | 9,367 | 11,601 | ||||||||||||||||||
Total sales
|
7,076 | 16,782 | 1,250 | 46,042 | 64,074 | 71,150 | ||||||||||||||||||
Profit from operations
|
191 | (111 | ) | (21 | ) | 1,023 | 891 | 1,082 | ||||||||||||||||
Assets
|
14,111 | 9,114 | 3,704 | 17,626 | 30,444 | 44,555 | ||||||||||||||||||
Capital expenditures
|
25 | 193 | 24 | 46 | 263 | 288 | ||||||||||||||||||
Depreciation and amortization
|
90 | 116 | 20 | 154 | 290 | 380 |
For the Three Months Ended
|
For the Nine Months Ended
|
|||||||||||||||||||||||||||||||
June 30,
2011
|
June 30,
2010
|
June 30,
2011
|
June 30,
2010
|
|||||||||||||||||||||||||||||
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
Amount
|
% of
Revenues
|
|||||||||||||||||||||||||
(Dollar amounts in millions)
|
||||||||||||||||||||||||||||||||
Vodafone
|
$ | 1.5 | 8 | % | $ | 1.1 | 4 | % | $ | 6.6 | 11 | % | $ | 6.0 | 8 | % | ||||||||||||||||
Verio
|
$ | 4.7 | 24 | % | $ | 9.8 | 34 | % | $ | 9.5 | 16 | % | $ | 17.6 | 25 | % | ||||||||||||||||
Atos
|
$ | 2.2 | 11 | % | $ | 0.5 | 2 | % | $ | 4.5 | 7 | % | $ | 2.3 | 3 | % |
8.
|
Fair Value Measures
|
Fair Value Measurements Using
|
||||||||||||||||||||
Quoted Prices in
Active
Markets for Identical
Instruments
(Level 1)
|
Significant
Other
Observable
Inputs
(Level 2)
|
Significant
Unobservable
Inputs
(Level 3)
|
Total
Balance
|
Gain
or
(loss)
|
||||||||||||||||
As of June 30, 2011
|
||||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||
Assets:
|
||||||||||||||||||||
Money Market funds
|
$ | 3,491 | $ | — | $ | — | $ | 3,491 | $ | — | ||||||||||
Total assets measured at fair value
|
$ | 3,491 | $ | — | $ | — | $ | 3,491 | $ | — | ||||||||||
As of September 30, 2010
|
||||||||||||||||||||
(Amounts in thousands)
|
||||||||||||||||||||
Assets:
|
||||||||||||||||||||
Money Market funds
|
$ | 3,482 | $ | — | $ | — | $ | 3,482 | $ | — | ||||||||||
10.
|
Income Taxes
|
Three months ended
June 30, 2011
|
Three months ended
June 30, 2010
|
|||||||
(Amounts in thousands)
|
||||||||
Beginning balance
|
$ | — | $ | 326 | ||||
Increases in tax positions in the current year
|
271 | — | ||||||
Settlements
|
— | — | ||||||
Lapse in statute of limitations
|
— | (302 | ) | |||||
Accrued penalties and interest
|
— | 8 | ||||||
Balance, end of period
|
$ | 271 | $ | 32 |
Nine months ended
June 30, 2011
|
Nine months ended
June 30, 2010
|
|||||||
(Amounts in thousands)
|
||||||||
Balance, beginning of year
|
$ | — | $ | 326 | ||||
Increases in tax positions in the current year
|
271 | — | ||||||
Settlements
|
— | — | ||||||
Lapse in statute of limitations
|
— | (302 | ) | |||||
Accrued penalties and interest
|
— | 8 | ||||||
Balance, end of period
|
$ | 271 | $ | 32 |
Item 2.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
|
•
|
Revenue decreased by approximately $10.2 million, or 14%, to $61.0 million for the nine months ended June 30, 2011 versus $71.2 million for the nine months ended June 30, 2010.
|
|
•
|
For the nine months ended June 30, 2011, operating income was approximately $0.8 million versus operating income of approximately $1.1 million for the nine months ended June 30, 2010.
|
|
•
|
For the nine months ended June 30, 2011, net income was approximately $0.5 million versus net income of approximately $0.9 million for the nine months ended June 30, 2010.
|
June 30,
2011
|
%
of sales
|
June 30,
2010
|
%
of sales
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
Sales
|
$ | 61,000 | 100 | % | $ | 71,150 | 100 | % | ||||||||
Costs and expenses:
|
||||||||||||||||
Cost of sales
|
48,602 | 80 | % | 58,460 | 82 | % | ||||||||||
Engineering and development
|
1,460 | 2 | % | 1,401 | 2 | % | ||||||||||
Selling, general and administrative
|
10,135 | 17 | % | 10,207 | 14 | % | ||||||||||
Total costs and expenses
|
60,197 | 99 | % | 70,068 | 98 | % | ||||||||||
Operating income
|
803 | 1 | % | 1,082 | 2 | % | ||||||||||
Other expense
|
(55 | ) | — | % | (46 | ) | — | % | ||||||||
Income before income taxes
|
748 | 1 | % | 1,036 | 2 | % | ||||||||||
Income tax expense
|
287 | — | % | 168 | — | % | ||||||||||
Net income
|
$ | 461 | 1 | % | $ | 868 | 1 | % |
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
For the nine months ended June 30, 2011:
|
||||||||||||||||
Product
|
$ | 3,563 | $ | 46,003 | $ | 49,566 | 81 | % | ||||||||
Services
|
2,036 | 9,398 | 11,434 | 19 | % | |||||||||||
Total
|
$ | 5,599 | $ | 55,401 | $ | 61,000 | 100 | % | ||||||||
% of Total
|
9 | % | 91 | % | 100 | % |
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
For the nine months ended June 30, 2010:
|
||||||||||||||||
Product
|
$ | 4,842 | $ | 54,707 | $ | 59,549 | 84 | % | ||||||||
Services
|
2,234 | 9,367 | 11,601 | 16 | % | |||||||||||
Total
|
$ | 7,076 | $ | 64,074 | $ | 71,150 | 100 | % | ||||||||
% of Total
|
10 | % | 90 | % | 100 | % | ||||||||||
Systems
|
Service and
System
Integration
|
Total
|
%
decrease
|
|||||||||||||
Increase (Decrease)
|
||||||||||||||||
Product
|
$ | (1,279 | ) | $ | (8,704 | ) | $ | (9,983 | ) | (17 | )% | |||||
Services
|
(198 | ) | 31 | (167 | ) | (1 | )% | |||||||||
Total
|
$ | (1,477 | ) | $ | (8,673 | ) | $ | (10,150 | ) | (14 | )% | |||||
% decrease
|
(21 | )% | (14 | )% | (14 | )% |
For the Nine Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
%
|
June 30,
2010
|
%
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
Americas
|
$ | 38,373 | 63 | % | $ | 51,582 | 73 | % | $ | (13,209 | ) | (26 | )% | |||||||||||
Europe
|
20,215 | 33 | % | 18,548 | 26 | % | 1,667 | 9 | % | |||||||||||||||
Asia
|
2,412 | 4 | % | 1,020 | 1 | % | 1,392 | 137 | % | |||||||||||||||
Totals
|
$ | 61,000 | 100 | % | $ | 71,150 | 100 | % | $ | (10,150 | ) | (14 | )% |
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
For the nine months ended June 30, 2011:
|
||||||||||||||||
Product
|
$ | 1,614 | $ | 39,826 | $ | 41,440 | 85 | % | ||||||||
Services
|
239 | 6,923 | 7,162 | 15 | % | |||||||||||
Total
|
$ | 1,853 | $ | 46,749 | $ | 48,602 | 100 | % | ||||||||
% of Total
|
4 | % | 96 | % | 100 | % | ||||||||||
% of Sales
|
33 | % | 84 | % | 80 | % | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
55 | % | 13 | % | 16 | % | ||||||||||
Services
|
88 | % | 26 | % | 37 | % | ||||||||||
Total
|
67 | % | 16 | % | 20 | % | ||||||||||
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
For the nine months ended June 30, 2010:
|
||||||||||||||||
Product
|
$ | 2,216 | $ | 48,513 | $ | 50,729 | 87 | % | ||||||||
Services
|
267 | 7,464 | 7,731 | 13 | % | |||||||||||
Total
|
$ | 2,483 | $ | 55,977 | $ | 58,460 | 100 | % | ||||||||
% of Total
|
4 | % | 96 | % | 100 | % | ||||||||||
% of Sales
|
35 | % | 87 | % | 82 | % | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
54 | % | 11 | % | 15 | % | ||||||||||
Services
|
88 | % | 20 | % | 33 | % | ||||||||||
Total
|
65 | % | 13 | % | 18 | % | ||||||||||
Decrease
|
||||||||||||||||
Product
|
$ | (602 | ) | $ | (8,687 | ) | $ | (9,289 | ) | (18 | )% | |||||
Services
|
(28 | ) | (541 | ) | (569 | ) | (7 | )% | ||||||||
Total
|
$ | (630 | ) | $ | (9,228 | ) | $ | (9,858 | ) | (17 | )% | |||||
% Decrease
|
(25 | )% | (16 | )% | (17 | )% | ||||||||||
% of Sales
|
(2 | )% | (3 | )% | (2 | )% | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
1 | % | 2 | % | 1 | % | ||||||||||
Services
|
- | % | 6 | % | 4 | % | ||||||||||
Total
|
2 | % | 3 | % | 2 | % |
For the Nine Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
% of
Total
|
June 30,
2010
|
% of
Total
|
$ Increase
|
% Increase
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
By Operating Segment:
|
||||||||||||||||||||||||
Systems
|
$ | 1,460 | 100 | % | $ | 1,401 | 100 | % | $ | 59 | 4 | % | ||||||||||||
Service and System Integration
|
— | — | % | — | — | % | — | — | % | |||||||||||||||
Total
|
$ | 1,460 | 100 | % | $ | 1,401 | 100 | % | $ | 59 | 4 | % |
For the Nine Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
% of
Total
|
June 30,
2010
|
% of
Total
|
$ Decrease
|
% Decrease
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
By Operating Segment:
|
||||||||||||||||||||||||
Systems
|
$ | 2,910 | 29 | % | $ | 2,976 | 29 | % | $ | (66 | ) | (2 | )% | |||||||||||
Service and System Integration
|
7,225 | 71 | % | 7,231 | 71 | % | (6 | ) | - | % | ||||||||||||||
Total
|
$ | 10,135 | 100 | % | $ | 10,207 | 100 | % | $ | (72 | ) | (1 | )% |
For the Nine Months Ended
|
||||||||||||
June 30,
2011
|
June 30,
2010
|
Increase
(Decrease)
|
||||||||||
(Amounts in thousands)
|
||||||||||||
Interest expense
|
$ | (64 | ) | $ | (68 | ) | $ | 4 | ||||
Interest income
|
27 | 38 | (11 | ) | ||||||||
Foreign exchange loss
|
- | (16 | ) | 16 | ||||||||
Other expense, net
|
(18 | ) | - | (18 | ) | |||||||
Total other expense, net
|
$ | (55 | ) | $ | (46 | ) | $ | (9 | ) |
|
•
|
Revenue decreased by approximately $8.9 million, or 31%, to $19.7 million for the three months ended June 30, 2011 versus $28.6 million for the three months ended June 30, 2010.
|
|
•
|
For the three months ended June 30, 2011, we had an operating loss of approximately $0.3 million versus operating income of approximately $0.7 million for the three months ended June 30, 2010, for a decrease of approximately $1.0 million, or 141% in our operating result.
|
|
•
|
For the three months ended June 30, 2011, we had a net loss of approximately $0.2 million versus net income of approximately $0.6 million for the three months ended June 30, 2010, for a decrease of approximately $0.8 million, or 134%.
|
June 30,
2011
|
%
of sales
|
June 30,
2010
|
%
of sales
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
Sales
|
$ | 19,681 | 100 | % | $ | 28,568 | 100 | % | ||||||||
Costs and expenses:
|
||||||||||||||||
Cost of sales
|
16,060 | 82 | % | 23,672 | 83 | % | ||||||||||
Engineering and development
|
442 | 2 | % | 498 | 2 | % | ||||||||||
Selling, general and administrative
|
3,450 | 17 | % | 3,740 | 13 | % | ||||||||||
Total costs and expenses
|
19,952 | 101 | % | 27,910 | 98 | % | ||||||||||
Operating income
|
(271 | ) | (1 | )% | 658 | 2 | % | |||||||||
Other expense
|
(33 | ) | — | % | (10 | ) | — | % | ||||||||
Income (loss) before income taxes
|
(304 | ) | (1 | )% | 648 | 2 | % | |||||||||
Income tax expense (benefit)
|
(90 | ) | — | % | 27 | — | % | |||||||||
Net income (loss)
|
$ | (214 | ) | (1 | )% | $ | 621 | 2 | % |
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
For the three months ended June 30, 2011:
|
||||||||||||||||
Product
|
$ | 1,323 | $ | 15,093 | $ | 16,416 | 83 | % | ||||||||
Services
|
152 | 3,113 | 3,265 | 17 | % | |||||||||||
Total
|
$ | 1,475 | $ | 18,206 | $ | 19,681 | 100 | % | ||||||||
% of Total
|
7 | % | 93 | % | 100 | % | ||||||||||
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
For the three months ended June 30, 2010:
|
||||||||||||||||
Product
|
$ | 313 | $ | 23,440 | $ | 23,753 | 83 | % | ||||||||
Services
|
1,741 | 3,074 | 4,815 | 17 | % | |||||||||||
Total
|
$ | 2,054 | $ | 26,514 | $ | 28,568 | 100 | % | ||||||||
% of Total
|
7 | % | 93 | % | 100 | % | ||||||||||
Systems
|
Service and
System
Integration
|
Total
|
%
decrease
|
|||||||||||||
Increase (Decrease)
|
||||||||||||||||
Product
|
$ | 1,010 | $ | (8,347 | ) | $ | (7,337 | ) | (31 | )% | ||||||
Services
|
(1,589 | ) | 39 | (1,550 | ) | (32 | )% | |||||||||
Total
|
$ | (579 | ) | $ | (8,308 | ) | $ | (8,887 | ) | (31 | )% | |||||
% decrease
|
(28 | )% | (31 | )% | (31 | )% |
For the three Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
%
|
June 30,
2010
|
%
|
$ Increase
(Decrease)
|
% Increase
(Decrease)
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
Americas
|
$ | 12,836 | 65 | % | $ | 23,388 | 82 | % | $ | (10,552 | ) | (45 | )% | |||||||||||
Europe
|
6,568 | 33 | % | 5,122 | 18 | % | 1,446 | 28 | % | |||||||||||||||
Asia
|
277 | 2 | % | 58 | - | % | 219 | 378 | % | |||||||||||||||
Totals
|
$ | 19,681 | 100 | % | $ | 28,568 | 100 | % | $ | (8,887 | ) | (31 | )% |
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||
For the three months ended June 30, 2011:
|
||||||||||||||||
Product
|
$ | 619 | $ | 13,071 | $ | 13,690 | 85 | % | ||||||||
Services
|
102 | 2,268 | 2,370 | 15 | % | |||||||||||
Total
|
$ | 721 | $ | 15,339 | $ | 16,060 | 100 | % | ||||||||
% of Total
|
4 | % | 96 | % | 100 | % | ||||||||||
% of Sales
|
49 | % | 84 | % | 82 | % | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
53 | % | 13 | % | 17 | % | ||||||||||
Services
|
33 | % | 27 | % | 27 | % | ||||||||||
Total
|
51 | % | 16 | % | 18 | % | ||||||||||
Systems
|
Service and
System
Integration
|
Total
|
% of
Total
|
|||||||||||||
For the three months ended June 30, 2010:
|
||||||||||||||||
Product
|
$ | 288 | $ | 20,865 | $ | 21,153 | 89 | % | ||||||||
Services
|
117 | 2,402 | 2,519 | 11 | % | |||||||||||
Total
|
$ | 405 | $ | 23,267 | $ | 23,672 | 100 | % | ||||||||
% of Total
|
2 | % | 98 | % | 100 | % | ||||||||||
% of Sales
|
20 | % | 88 | % | 83 | % | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
8 | % | 11 | % | 11 | % | ||||||||||
Services
|
93 | % | 22 | % | 48 | % | ||||||||||
Total
|
80 | % | 12 | % | 17 | % | ||||||||||
Increase (decrease)
|
||||||||||||||||
Product
|
$ | 331 | $ | (7,794 | ) | $ | (7,463 | ) | (35 | )% | ||||||
Services
|
(15 | ) | (134 | ) | (149 | ) | (6 | )% | ||||||||
Total
|
$ | 316 | $ | (7,928 | ) | $ | (7,612 | ) | (32 | )% | ||||||
% Increase (decrease)
|
78 | % | (34 | )% | (32 | )% | ||||||||||
% of Sales
|
29 | % | (4 | )% | (1 | )% | ||||||||||
Gross Margins:
|
||||||||||||||||
Product
|
45 | % | 2 | % | 6 | % | ||||||||||
Services
|
(60 | )% | 5 | % | (21 | )% | ||||||||||
Total
|
(29 | )% | 4 | % | 1 | % |
For the Three Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
% of
Total
|
June 30,
2010
|
% of
Total
|
$ Decrease
|
% Decrease
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
By Operating Segment:
|
||||||||||||||||||||||||
Systems
|
$ | 442 | 100 | % | $ | 498 | 100 | % | $ | (56 | ) | (11 | )% | |||||||||||
Service and System Integration
|
— | — | % | — | — | % | — | — | % | |||||||||||||||
Total
|
$ | 442 | 100 | % | $ | 498 | 100 | % | $ | (56 | ) | (11 | )% |
For the Three Months Ended
|
||||||||||||||||||||||||
June 30,
2011
|
% of
Total
|
June 30,
2010
|
% of
Total
|
$ Increase (Decrease)
|
% Increase (Decrease)
|
|||||||||||||||||||
(Dollar amounts in thousands)
|
||||||||||||||||||||||||
By Operating Segment:
|
||||||||||||||||||||||||
Systems
|
$ | 1,122 | 33 | % | $ | 1,073 | 29 | % | $ | 49 | 5 | % | ||||||||||||
Service and System Integration
|
2,328 | 67 | % | 2,667 | 71 | % | (339 | ) | (13 | )% | ||||||||||||||
Total
|
$ | 3,450 | 100 | % | $ | 3,740 | 100 | % | $ | (290 | ) | (8 | )% |
For the Three Months Ended
|
||||||||||||
June 30,
2011
|
June 30,
2010
|
Increase
(Decrease)
|
||||||||||
(Amounts in thousands)
|
||||||||||||
Interest expense
|
$ | (21 | ) | $ | (22 | ) | $ | 1 | ||||
Interest income
|
11 | 20 | (9 | ) | ||||||||
Foreign exchange gain (loss)
|
(9 | ) | (6 | ) | (3 | ) | ||||||
Other income (expense), net
|
(14 | ) | (2 | ) | (12 | ) | ||||||
Total other expense, net
|
$ | (33 | ) | $ | (10 | ) | $ | (23 | ) |
Item 4.
|
Controls and Procedures
|
Item 2.
|
Unregistered Sales of Equity Securities and Use of Proceeds
|
Issuer Purchases of Equity Securities
|
|||||||||||||
Period
|
Total Number of
Shares Purchased
|
Average Price
Paid per Share
|
Total Number of Shares
Purchased as
Part of Publicly
Announced Plans (1)
|
Maximum Number of
Shares that May
Yet Be
Purchased Under
the Plans
|
|||||||||
October 1-31, 2010
|
7,940 | $ | 4.53 | 7,940 | |||||||||
November 1-30, 2010
|
9,500 | $ | 4.52 | 9,500 | |||||||||
December 1-31, 2010
|
28,221 | $ | 3.98 | 28,221 | |||||||||
January 1-31, 2011
|
44,393 | $ | 3.98 | 44,393 | |||||||||
February 1-28, 2011
|
3,543 | $ | 4.01 | 3,543 | |||||||||
March 1-31, 2011
|
3,000 | $ | 4.20 | 3,000 | |||||||||
April 1-30, 2011
|
- | $ | - | - | |||||||||
May 1-31, 2011
|
4,145 | $ | 4.47 | 4,145 | |||||||||
June 1-30, 2011
|
8,692 | $ | 4.36 | 8,692 | |||||||||
Total
|
109,434 | $ | 4.12 | 109,434 |
285,122
|
(1)
|
All shares were purchased under publicly announced plans. For additional information about these publicly announced plans, please refer to Note 12 of our audited financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2010. On February 8, 2011, the Board of Directors authorized the Company to purchase up to 250 thousand additional shares of the Company’s outstanding common stock at market price.
|
Item 6.
|
Exhibits
|
Number
|
Description
|
|
3.1
|
Articles of Organization and amendments thereto (incorporated by reference to Exhibit 3.1 to our Form 10-K for the year ended September 30, 2007)
|
|
3.2
|
By-Laws, as amended (incorporated by reference to Exhibit 3.2 to our Form 10-K for the year ended September 30, 2007)
|
|
31.1*
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
31.2*
|
Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
|
|
32.1*
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
|
|
101*
|
Interactive Data Files regarding (a) our Consolidated Balance Sheets as of June 30, 2011 and September 30, 2010, (b) our Consolidated Statements of Operations for the Three and Nine Months Ended June 30, 2011 and 2010, (c) our Consolidated Statement of Shareholders’ Equity for the Nine Months Ended June 30, 2011, (d) our Consolidated Statements of Cash Flows for the Nine Months Ended June 30, 2011 and 2010 and (e) the Notes to such Consolidated Financial Statements.
|
CSP INC.
|
|||
Date: August 9, 2011
|
By:
|
/s/Alexander R. Lupinetti
|
|
Alexander R. Lupinetti
|
|||
Chief Executive Officer,
|
|||
President and Chairman
|
|||
Date: August 9, 2011
|
By:
|
/s/Gary W. Levine
|
|
Gary W. Levine
|
|||
Chief Financial Officer
|
Number
|
Description
|
|
3.1
|
Articles of Organization and amendments thereto (incorporated by reference to Exhibit 3.1 to our Form 10-K for the year ended September 30, 2007)
|
|
3.2
|
By-Laws, as amended (incorporated by reference to Exhibit 3.2 to our Form 10-K for the year ended September 30, 2007)
|
|
31.1*
|
Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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31.2*
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Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
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32.1*
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Certification of Chief Executive Officer and Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
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101*
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Interactive Data Files regarding (a) our Consolidated Balance Sheets as of June 30, 2011 and September 30, 2010, (b) our Consolidated Statements of Operations for the Three and Nine Months Ended June 30, 2011 and 2010, (c) our Consolidated Statement of Shareholders’ Equity for the Nine Months Ended June 30, 2011, (d) our Consolidated Statements of Cash Flows for the Nine Months Ended June 30, 2011 and 2010 and (e) the Notes to such Consolidated Financial Statements.
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/s/Alexander R. Lupinetti
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Alexander R. Lupinetti
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Chief Executive Officer;
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President and Chairman
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/s/Gary W. Levine
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Gary W. Levine
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Chief Financial Officer
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(1)
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The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
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(2)
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The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
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Date: August 9, 2011
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By:
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/s/Alexander R. Lupinetti
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Alexander R. Lupinetti
Chief Executive Officer,
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|||
President and Chairman
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|||
Date: August 9, 2011
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By:
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/s/Gary W. Levine
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Gary W. Levine
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|||
Chief Financial Officer
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Consolidated Balance Sheets (Parentheticals) (USD $)
In Thousands, except Per Share data |
Jun. 30, 2011
|
Sep. 30, 2010
|
---|---|---|
Allowances (in Dollars) | $ 277 | $ 288 |
Common stock par value (in Dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 7,500 | 7,500 |
Common stock, shares issued | 3,473 | 3,520 |
Common stock, shares outstanding | 3,473 | 3,520 |
Unaudited Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2011
|
Jun. 30, 2010
|
Jun. 30, 2011
|
Jun. 30, 2010
|
|
Sales: | Â | Â | Â | Â |
Product | $ 16,416 | $ 23,753 | $ 49,566 | $ 59,549 |
Services | 3,265 | 4,815 | 11,434 | 11,601 |
Total sales | 19,681 | 28,568 | 61,000 | 71,150 |
Cost of sales: | Â | Â | Â | Â |
Product | 13,690 | 21,153 | 41,440 | 50,729 |
Services | 2,370 | 2,519 | 7,162 | 7,731 |
Total cost of sales | 16,060 | 23,672 | 48,602 | 58,460 |
Gross profit | 3,621 | 4,896 | 12,398 | 12,690 |
Operating expenses: | Â | Â | Â | Â |
Engineering and development | 442 | 498 | 1,460 | 1,401 |
Selling, general and administrative | 3,450 | 3,740 | 10,135 | 10,207 |
Total operating expenses | 3,892 | 4,238 | 11,595 | 11,608 |
Operating income (loss) | (271) | 658 | 803 | 1,082 |
Other income (expense): | Â | Â | Â | Â |
Foreign exchange gain (loss) | (9) | (6) | Â | (16) |
Other income (expense), net | (24) | (4) | (55) | (30) |
Net other income (expense) | (33) | (10) | (55) | (46) |
Income (loss) before income taxes | (304) | 648 | 748 | 1,036 |
Income tax expense (benefit) | (90) | 27 | 287 | 168 |
Net income (loss) | (214) | 621 | 461 | 868 |
Net income (loss) attributable to common shareholders | $ (211) | $ 614 | $ 455 | $ 860 |
Net income (loss) per share – basic (in Dollars per share) | $ (0.06) | $ 0.17 | $ 0.13 | $ 0.24 |
Weighted average shares outstanding – basic (in Shares) | 3,428 | 3,548 | 3,446 | 3,545 |
Net income (loss) per share – diluted (in Dollars per share) | $ (0.06) | $ 0.17 | $ 0.13 | $ 0.24 |
Weighted average shares outstanding – diluted (in Shares) | 3,428 | 3,574 | 3,485 | 3,574 |
Document And Entity Information
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9 Months Ended | |
---|---|---|
Jun. 30, 2011
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Jul. 28, 2011
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Document and Entity Information [Abstract] | Â | Â |
Entity Registrant Name | CSP INC /MA/ | Â |
Document Type | 10-Q | Â |
Current Fiscal Year End Date | --09-30 | Â |
Entity Common Stock, Shares Outstanding | Â | 3,473,222 |
Amendment Flag | false | Â |
Entity Central Index Key | 0000356037 | Â |
Entity Current Reporting Status | Yes | Â |
Entity Voluntary Filers | No | Â |
Entity Filer Category | Smaller Reporting Company | Â |
Entity Well-known Seasoned Issuer | No | Â |
Document Period End Date | Jun. 30, 2011 | |
Document Fiscal Year Focus | 2011 | Â |
Document Fiscal Period Focus | Q3 | Â |
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Note 6 - Pension and Retirement Plans
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Jun. 30, 2011
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Pension and Other Postretirement Benefits Disclosure [Text Block] |
6. Pension
and Retirement Plans
The
Company has defined benefit and defined contribution plans in
the United Kingdom, Germany and the U.S. In the United
Kingdom and Germany, the Company provides defined benefit
pension plans and defined contribution plans for the majority
of its employees. In the U.S., the Company provides benefits
through supplemental retirement plans to certain current and
former employees. The domestic supplemental retirement plans
have life insurance policies which are not plan assets but
were purchased by the Company as a vehicle to fund the costs
of the plan. Domestically, the Company also provides for
officer death benefits through post-retirement plans to
certain officers. All of the Company’s
defined benefit plans are closed to newly hired employees and
have been for fiscal years 2009, 2010 and for the nine months
ended June 30, 2011.
The
Company funds its pension plans in amounts sufficient to meet
the requirements set forth in applicable employee benefits
laws and local tax laws. Liabilities for amounts in excess of
these funding levels are accrued and reported in the
consolidated balance sheets.
Our
pension plan in the United Kingdom is the only plan with plan
assets. The plan assets consist of an investment in a
commingled fund which in turn comprises a diversified mix of
assets including corporate equity securities, government
securities and corporate debt securities.
The
components of net periodic benefit costs related to the U.S.
and international plans are as follows:
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Note 2 - Use of Estimates
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9 Months Ended | ||
---|---|---|---|
Jun. 30, 2011
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Use of Estimates, Policy [Policy Text Block] |
The
preparation of consolidated financial statements in
conformity with accounting principles generally accepted in
the United States requires management to make estimates and
assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the
reported amounts of revenues and expenses during the
reporting period. Actual results may differ from those
estimates under different assumptions or conditions.
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Note 8 - Fair Value Measures
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Jun. 30, 2011
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Fair Value Disclosures [Text Block] |
Assets
and Liabilities measured at fair value on a recurring basis
are as follows:
These
assets are included in cash and cash equivalents in the
accompanying consolidated balance sheets. All
other monetary assets and liabilities are short-term in
nature and approximate their fair value.
The
Company had no liabilities measured at fair value as of June
30, 2011 or September 30, 2010. The Company had no assets or
liabilities measured at fair value on a non recurring basis
as of June 30, 2011 or September 30, 2010.
|
Note 9 - Common Stock Repurchase
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9 Months Ended |
---|---|
Jun. 30, 2011
|
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Treasury Stock [Text Block] |
9. Common
Stock Repurchase
On
February 3, 2009, the Board of Directors (the
“Board”) authorized the Company to purchase up to
350 thousand additional shares of the Company’s
outstanding common stock at market price. As of
September 30, 2010, there remained approximately 145 thousand
shares pursuant to this authorization. On
February 8, 2011, the Board authorized the Company to
purchase up to 250 thousand additional shares of the
Company’s outstanding common stock at market
price. Pursuant to this and the prior
authorization by the Board, the Company repurchased
approximately 109 thousand shares of its outstanding common
stock during the nine months ended June 30,
2011. As of June 30, 2011, approximately 286
thousand shares remain authorized for repurchase under the
Company’s stock repurchase program.
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Note 7 - Segment Information
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Jun. 30, 2011
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Segment Reporting Disclosure [Text Block] |
The
following table presents certain operating segment
information.
Profit
(loss) from operations is sales less cost of sales,
engineering and development, selling, general and
administrative expenses but is not affected by either
non-operating charges/income or by income taxes.
Non-operating charges/income consists principally of
investment income and interest expense. All
intercompany transactions have been eliminated.
The
following table lists customers from which the Company
derived revenues in excess of 10% of total revenues for the
three and nine month periods ended June 30, 2011 and
2010.
|
Note 3 - Earnings Per Share of Common Stock
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Jun. 30, 2011
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Earnings Per Share [Text Block] |
Basic
net income per common share is computed by dividing net
income available to common shareholders by the weighted
average number of common shares outstanding for the period.
Diluted net income per common share reflects the maximum
dilution that would have resulted from the assumed exercise
and share repurchase related to dilutive stock options and is
computed by dividing net income by the assumed weighted
average number of common shares outstanding.
We
are required to present earnings per share, or EPS, utilizing
the two class method because we had outstanding, non-vested
share-based payment awards that contain non-forfeitable
rights to dividends or dividend equivalents, which are
considered participating securities.
Basic
and diluted earnings per share computations for the
Company’s reported net income attributable to common
stockholders are as follows:
All
anti-dilutive securities, including stock options, are
excluded from the diluted income per share computation. For
the three and nine months ended June 30, 2011, 247,000 and
205,000 options, respectively, were excluded from the diluted
income per share calculation because their inclusion would
have been anti-dilutive.
|
Note 4 - Inventories
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Jun. 30, 2011
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Inventory Disclosure [Text Block] |
4. Inventories
Inventories
consist of the following:
Finished
goods includes inventory that has been shipped, but for which
all revenue recognition criteria has not been met of
approximately $1.7 million and $2.4 million as of June 30,
2011 and September 30, 2010, respectively.
Total
inventory balances in the table above are shown net of
reserves for obsolescence of approximately $4.2 million and
$4.1 million as of June 30, 2011 and September 30, 2010,
respectively.
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Note 5 - Accumulated Other Comprehensive Loss
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9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2011
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Comprehensive Income (Loss) Note [Text Block] |
The
components of comprehensive income (loss) are as
follows:
The
components of Accumulated Other Comprehensive Loss are as
follows:
|
Unaudited Consolidated Statement of Shareholders’ Equity (USD $)
In Thousands |
Total
|
Common Stock [Member]
|
Additional Paid-in Capital [Member]
|
Retained Earnings [Member]
|
Accumulated Other Comprehensive Income (Loss) [Member]
|
Comprehensive Income [Member]
|
---|---|---|---|---|---|---|
Balance at Sep. 30, 2010 | $ 18,479 | $ 35 | $ 11,280 | $ 12,516 | $ (5,352) | Â |
Balance (in Shares) at Sep. 30, 2010 | 3,520 | 3,520 | Â | Â | Â | Â |
Comprehensive income (loss): | Â | Â | Â | Â | Â | Â |
Net income | 461 | Â | Â | 461 | Â | 461 |
Other comprehensive income: | Â | Â | Â | Â | Â | Â |
Effect of foreign currency translation | 156 | Â | Â | Â | 156 | 156 |
Total comprehensive income | Â | Â | Â | Â | Â | 617 |
Stock-based compensation | 54 | Â | 54 | Â | Â | Â |
Issuance of shares under employee stock purchase plan | 74 | Â | 74 | Â | Â | Â |
Issuance of shares under employee stock purchase plan (in Shares) | Â | 25 | Â | Â | Â | Â |
Restricted stock shares issued | 75 | 1 | 74 | Â | Â | Â |
Restricted stock shares issued (in Shares) | Â | 37 | Â | Â | Â | Â |
Purchase of common stock | (448) | (1) | (447) | Â | Â | Â |
Purchase of common stock (in Shares) | Â | (109) | Â | Â | Â | Â |
Balance at Jun. 30, 2011 | $ 18,851 | $ 35 | $ 11,035 | $ 12,977 | $ (5,196) | Â |
Balance (in Shares) at Jun. 30, 2011 | 3,473 | 3,473 | Â | Â | Â | Â |
Note 1 - Basis of Presentation
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9 Months Ended | ||
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Jun. 30, 2011
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Basis of Accounting [Text Block] |
The
accompanying consolidated financial statements have been
prepared by the Company, without audit, and reflect all
adjustments which, in the opinion of management, are
necessary for a fair statement of the results of the interim
periods presented. All adjustments were of a normal recurring
nature. Certain information and footnote disclosures normally
included in the annual financial statements, which are
prepared in accordance with accounting principles generally
accepted in the United States, have been condensed or
omitted. Accordingly, the Company believes that although the
disclosures are adequate to make the information presented
not misleading, the unaudited financial statements should be
read in conjunction with the footnotes contained in the
Company’s Annual Report on Form 10-K for the fiscal
year ended September 30, 2010.
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Note 10 - Income Taxes
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Jun. 30, 2011
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Income Tax Disclosure [Text Block] |
We
follow the applicable accounting provisions which clarify the
accounting for uncertainty in income tax positions. These
provisions require us to recognize in the consolidated
financial statements only those tax positions determined to
be more-likely-than-not of being sustained upon examination,
based on the technical merits of the positions as of the
reporting date. If a tax position is not considered
more-likely-than-not to be sustained based solely on its
technical merits, no benefits of the position are recognized.
The more-likely-than-not threshold must continue to be met in
each reporting period to support continued recognition of a
benefit.
As
of June 30, 2011, the total amount of uncertain tax
liabilities was $271 thousand, all of which would affect our
effective tax rate if recognized. We recognize interest and
potential penalties accrued related to unrecognized tax
benefits in our provision for income taxes.
A
reconciliation of the beginning and ending balances of the
total amounts of gross unrecognized tax benefits is as
follows:
We
file income tax returns in the U.S. federal jurisdictions and
various state and foreign jurisdictions. The
Internal Revenue Service has completed an examination of
fiscal year 2007, which did not result in any tax adjustment
relating to our uncertain tax positions. The
Company has reviewed the tax positions taken on returns filed
domestically and in its foreign jurisdictions for all open
years, generally fiscal 2006 through 2010, and believes that
tax adjustments in any audited year will not be material,
except for the uncertain tax position described above.
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