0001628280-16-016328.txt : 20160513 0001628280-16-016328.hdr.sgml : 20160513 20160513145527 ACCESSION NUMBER: 0001628280-16-016328 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20160511 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20160513 DATE AS OF CHANGE: 20160513 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CSP INC /MA/ CENTRAL INDEX KEY: 0000356037 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373] IRS NUMBER: 042441294 STATE OF INCORPORATION: MA FISCAL YEAR END: 1219 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-10843 FILM NUMBER: 161647813 BUSINESS ADDRESS: STREET 1: 43 MANNING ROAD CITY: BILLERICA STATE: MA ZIP: 01821 BUSINESS PHONE: 9786637598 MAIL ADDRESS: STREET 1: 43 MANNING ROAD CITY: BILLERICA STATE: MA ZIP: 01821 8-K 1 item20203-31x16.htm 8-K SEC Document
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 11, 2016

CSP Incorporated
(Exact name of the registrant as specified in its charter)

Massachusetts
(State or other jurisdiction of incorporation)

000-10843
04-2441294
(Commission File Number)
(IRS Employer Identification No.)

175 Cabot Street - Suite 210, Lowell, Massachusetts
01854
(Address of principal executive offices)
(Zip Code)

(978) 663-7598
(Registrant’s telephone number, including area code)

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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
(17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
(17 CFR 240.13e-4(c))


Item 2.02   Results of Operations and Financial Condition.

On May 11, 2016, CSP Inc. (the “Company”) issued a press release announcing its financial results for the second quarter of fiscal year 2016 which ended on March 31, 2016. A copy of the press release relating to such announcement is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

The information set forth in this Form 8-K, including the exhibits attached hereto, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that Section. The information in this Form 8-K shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.

Item 9.01   Financial Statements and Exhibits.

(c)    Exhibits
99.1    Press Release Dated May 11, 2016.


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.

CSP INC.

Date: May 13, 2016

By: /s/Gary W. Levine
Gary W. Levine
Vice President Finance and
Chief Financial Officer


 EX-99.1 2 a10q3-31x16991.htm EXHIBIT 99.1 SEC Exhibit
Exhibit 99.1


Contact:    Gary Levine                            
Chief Financial Officer
CSP Inc.
Tel: 978.663.7598 ext. 1200            
Fax: 978-455-3251


CSP Inc. Reports Second-Quarter Fiscal 2016 Financial Results
LOWELL, MA, May 11, 2016 - CSP Inc. (NASDAQ: CSPI), a provider of IT solutions and high-performance Ethernet products for diverse applications, today reported financial results for the second quarter of fiscal 2016 ended March 31, 2016.
The Company also announced that its board of directors has voted to pay its quarterly dividend of $0.11 per share to shareholders of record May 27, 2016 payable June 10, 2016.

Management Comments

“We performed well financially in the second quarter as we continued to make good progress on executing our growth strategy,” said President and Chief Executive Office Victor Dellovo. “Sales were up 44% in the second quarter, and we reported EPS of $0.13 versus a loss of $0.19 a year ago.”

“In the High Performance Products Division, we launched our new next-generation FPGA network adapter product for the packet capture and financial services markets,” said Dellovo. “The product, branded “Class E,” is currently in production at multiple customer sites. We also secured our first major engagement for the packet capture market by shipping a large order to our first hyperscale data center end user. This shipment was a key contributor to our strong revenue growth this quarter. Customer interest in our packet capture product has been very positive, and we have a robust pipeline in place. We also are building momentum with our product for the financial services market, and have brought our first few customers into production.”

“At our Technology Solutions Division, our core strategy continues to be increasing higher-margin revenues from managed services,” said Dellovo. “Our managed services pipeline is building and we continue to take actions to further increase this revenue stream. Our cross-selling strategy is also proving successful as we recorded sales between locations at our Technology Solutions Division, as well as between the Technology Solutions and High Performance Products divisions. The performance of our UK operation, which has now been fully integrated into our Germany operation, has improved significantly and turned its first profit in several quarters.”

“Looking ahead, we continue to be encouraged by the progress we are making in executing on our strategy across our businesses. Our past work is now beginning to yield results and we are excited by the great potential before us,” concluded Dellovo.

Financial Results
For the second quarter of fiscal 2016, revenue was $27.1 million compared with $18.9 million in the second quarter a year ago.

Gross margin for the second quarter of fiscal 2016 grew to 23.3% from 21.4% for the prior-year period due to leverage on higher volumes.

Exhibit 99.1


Net income for the second quarter of fiscal 2016 was $503,000, or $0.13 per diluted share, compared with a net loss of $675,000, or $0.19 per share, in the second quarter of fiscal 2015.
Cash and short-term investments decreased to $10.0 million at the end of the second quarter of fiscal 2016 from $11.2 million at year end 2015. The decrease was the result of the payment of the quarterly dividends and purchase of capital equipment, partially offset by cash from operations.
Conference Call Details
CSPi Chief Executive Officer Victor Dellovo and Chief Financial Officer Gary W. Levine will host a conference call at 10:00 a.m. (ET) today to review CSPi’s financial results and provide a business update. To listen to a live webcast of the call, please visit the “Investor Relations” section of the Company’s website at www.cspi.com. Individuals may also listen to the call via telephone, by dialing 877-876-9174 or 785-424-1669. For interested parties unable to participate in the live call, an archived version of the webcast will be available for approximately one year on CSPi’s website.

About CSP Inc.
CSPi (NASDAQ: CSPI) maintains two distinct and dynamic divisions - High Performance Products and Technology Solutions - with a shared vision for technology excellence. CSPi’s High Performance Products division offers extreme-performance Ethernet products for diverse applications, including cybersecurity, financial trading, content creation/distribution, storage networking applications, as well computer signal processing systems. CSPi’s Technology Solutions division provides innovative technology solutions for network solutions, wireless & mobility, unified communications & collaboration, data center solutions, advanced security, along with professional and managed services across those technology focus areas. CSPi Technology Solutions works with the world’s leading IT software and infrastructure companies to create solutions for the unique IT requirements of its customers. For more information, please visit www.cspi.com.


Safe Harbor 

The Company wishes to take advantage of the “Safe Harbor” provisions of the Private Securities Litigation Reform Act of 1995 with respect to statements that may be deemed to be forward-looking under the Act. Such forward-looking statements may include, but are not limited to, those related to managed services pipeline is building and we continue to take actions to further increase this revenue stream. The Company cautions that numerous factors could cause actual results to differ materially from forward-looking statements made by the Company. Such risks include general economic conditions, market factors, competitive factors and pricing pressures, and others described in the Company's filings with the SEC. Please refer to the section on forward-looking statements included in the Company's filings with the Securities and Exchange Commission.


Exhibit 99.1

CSP INC. AND SUBSIDIARIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(Amounts in thousands)
 
 
 
 
 
March 31, 2016
 
September 30, 2015
Assets
 
 
 
Current assets:
 
 
 
  Cash and short-term investments
$
10,020

 
$
11,181

  Accounts receivable, net
22,780

 
19,888

  Inventories
4,807

 
5,749

  Other current assets
3,547

 
3,264

     Total current assets
41,154

 
40,082

Property, equipment and improvements, net
1,631

 
1,564

Other assets
5,463

 
5,350

Total assets
$
48,248

 
$
46,996

 
 
 
 
Liabilities and Shareholders’ Equity
 
 
 
Current liabilities
18,609

 
17,382

Pension and retirement plans
9,700

 
10,009

Non-current liabilities
18

 
15

Total Liabilities
28,327

 
27,406

Shareholders’ equity
19,921

 
19,590

Total liabilities and shareholders’ equity
$
48,248

 
$
46,996



























Exhibit 99.1

CSP INC. AND SUBSIDIARIES
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share data)
 
For the three months ended,
 
For the six months ended,
 
March 31, 2016
 
March 31, 2015
 
March 31, 2016
 
March 31, 2015
Sales:
 
 
 
 
 
 
 
   Product
$
20,972

 
$
14,195

 
$
37,975

 
$
29,848

   Service
6,167

 
4,682

 
12,840

 
9,459

        Total sales
27,139

 
18,877

 
50,815

 
39,307

 
 
 
 
 
 
 
 
Cost of Sales:
 
 
 
 
 
 
 
   Product
17,054

 
11,380

 
31,290

 
24,513

   Service
3,752

 
3,454

 
8,002

 
6,796

        Total cost of sales
20,806

 
14,834

 
39,292

 
31,309

 
 
 
 
 
 
 
 
   Gross profit
6,333

 
4,043

 
11,523

 
7,998

 
 
 
 
 
 
 
 
Operating expenses:
 
 
 
 
 
 
 
   Engineering and development
790

 
826

 
1,589

 
1,679

   Selling, general & administrative
4,665

 
3,856

 
8,713

 
7,879

        Total operating expenses
5,455

 
4,682

 
10,302

 
9,558

 
 
 
 
 
 
 
 
Operating income (loss)
878

 
(639
)
 
1,221

 
(1,560
)
 
 
 
 
 
 
 
 
Other income (expense), net
(117
)
 
(129
)
 
(89
)
 
(162
)
 
 
 
 
 
 
 
 
Income (loss) before income taxes
761

 
(768
)
 
1,132

 
(1,722
)
Income tax expense (benefit)
258

 
(93
)
 
346

 
(610
)
 
 
 
 
 
 
 
 
Net income (loss)
$
503

 
$
(675
)
 
$
786

 
$
(1,112
)
 
 
 
 
 
 
 
 
Net income (loss) attributable to common stockholders
$
480

 
$
(649
)
 
$
756

 
$
(1,072
)
 
 
 
 
 
 
 
 
Income (loss) per share - basic
$
0.13

 
$
(0.19
)
 
$
0.21

 
$
(0.31
)
Weighted average shares outstanding - basic
3,609

 
3,525

 
3,589

 
3,507

 
 
 
 
 
 
 
 
Income (loss) per share - diluted
$
0.13

 
$
(0.19
)
 
$
0.20

 
$
(0.31
)
Weighted average shares outstanding - diluted
3,730

 
3,525

 
3,728

 
3,507