-----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, WFScRzSQqPKUfYwURLBVE0Az8TrqiXAWAJPMP+6ttTEm8Ok53q9IMbm3w3OCsELd OaE7BQEKJSmRk0NiaNvrsQ== 0001010549-96-000070.txt : 19960515 0001010549-96-000070.hdr.sgml : 19960515 ACCESSION NUMBER: 0001010549-96-000070 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960514 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERPHASE CORP CENTRAL INDEX KEY: 0000728249 STANDARD INDUSTRIAL CLASSIFICATION: COMPUTER PERIPHERAL EQUIPMENT, NEC [3577] IRS NUMBER: 751549797 STATE OF INCORPORATION: TX FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13071 FILM NUMBER: 96563925 BUSINESS ADDRESS: STREET 1: 13800 SENLAC DR CITY: DALLAS STATE: TX ZIP: 75234 BUSINESS PHONE: 2146545000 MAIL ADDRESS: STREET 1: 13800 SENLAC DR STREET 2: 13800 SENLAC DR CITY: DALLAS STATE: TX ZIP: 75234 10-Q 1 SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTIONS 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarter Ended March 31, 1996 Commission File Number 0-13071 INTERPHASE CORPORATION (Exact name of registrant as specified in its charter) Texas 75-1549797 (State of incorporation) (IRS Employer Identification No.) 13800 Senlac, Dallas, Texas 75234 (Address of principal executive offices) (214)-654-5000 (Registrant's telephone number, including area code) - -------------------------------------------------------------------------------- Indicate by check mark whether the registrant (1) has filed all reports required by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No - -------------------------------------------------------------------------------- Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Class Outstanding at May 3, 1996 Common Stock, No par value 4,705,713 INTERPHASE CORPORATION INDEX Part I -Financial Information Item 1. Consolidated Interim Financial Statements Consolidated Balance Sheets as of March 31, 1996 and October 31, 1995 3 Consolidated Statements of Operations for the three months ended March 31, 1996 and April 30, 1995 4 Consolidated Statements of Cash Flows for the three months ended March 31, 1996 and April 30, 1995 5 Notes to Consolidated Interim Financial Statements 6 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 Part II- Other Information Signature 8 2 INTERPHASE CORPORATION CONSOLIDATED BALANCE SHEETS (in thousands, except number of shares)
ASSETS March 31, October 31, 1996 1995 ------------ ------------- (Unaudited) Cash and cash equivalents $1,704 $3,320 Marketable securities 7,313 9,366 Trade accounts receivable, less allowances for uncollectible accounts of $238 and $238, respectively 8,520 7,521 Inventories, net 9,065 7,486 Prepaid expenses and other current assets 1,006 957 Deferred income taxes, net 594 603 ------------ ------------- Total current assets 28,211 29,244 Machinery and equipment 11,689 10,920 Leasehold improvements 2,790 2,758 Furniture and fixtures 351 267 ------------ ------------- 14,746 14,029 Less-accumulated depreciation and amortization (9,452) (8,820) ------------ ------------- Total property and equipment, net 5,294 5,209 Capitalized software, net of accumulated amortization 524 462 Deferred income taxes, net 301 301 Other assets 152 214 ------------ ------------- Total assets $34,482 $35,430 ============ ============= LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable and accrued liabilities $3,078 $3,193 Accrued compensation 1,289 1,357 Income taxes payable 366 - ------------ ------------- Total current liabilities 4,367 4,916 Deferred lease obligations 103 92 ------------ ------------- Total liabilities 4,459 5,019 Common stock, no par value; 100,000,000 shares authorized; 4,692,233 and 4,661,303 shares outstanding 24,331 24,177 Retained earnings 5,739 6,263 Unrealized holding period loss (47) (29) ------------ ------------- Total shareholders' equity 30,023 30,411 ------------ ------------- Total liabilities and shareholders' equity $34,482 $35,430 ============ =============
The accompanying notes are an integral part of these consolidated financial statements. 3 INTERPHASE CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands except per share amounts) (Unaudited)
Three Months Ended ------------------------------------------ 31-Mar-96 30-Apr-95 -------------- ------------- Revenues $ 11,877 $ 11,473 Cost of sales 5,686 5,702 -------------- ------------- Gross profit 6,191 5,771 Research and development 2,228 1,875 Sales and marketing 2,131 2,061 General and administrative 987 1,004 -------------- ------------- Total operating expenses 5,346 4,940 -------------- ------------- Operating income 845 831 -------------- ------------- Interest income 166 144 Other, net (4) 30 -------------- ------------- Income before income taxes 1,007 1,005 Provision for income taxes 363 360 -------------- ------------- Net income $644 $645 ============== ============= Net income per common and common equivalent share $0.13 $0.13 ============== ============= Weighted average common and common equivalent shares 5,064 4,973 ============== =============
The accompanying notes are an integral part of these consolidated financial statements. 4 CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands)
Three Months Ended (Unaudited) -------------------------------- 31-Mar-96 30-Apr-95 --------------- --------------- Cash flow from operating activities: Net income $ 644 $ 645 Adjustment to reconcile net income to net cash provided (used) by operating activities: Depreciation and amortization 791 665 Change in assets and liabilities: Trade accounts receivable (4,574) 781 Inventories 594 (804) Prepaid expenses and other current assets (142) (44) Accounts payable and accrued liabilities 243 (63) Accrued compensation (111) 317 Income taxes payable - (75) Deferred income taxes payable (10) 481 Deferred lease obligations (7) (1) --------------- --------------- Net adjustments (3,216) 1,257 --------------- --------------- Net cash provided (used) by operating activities (2,572) 1,902 Cash flows from investing activities: Additions to property, equipment and leasehold improvements (798) (355) Additions to capitalized software (85) (30) Decrease (Increase) in other assets 9 (14) Decrease (Increase) in marketable securities 2,054 (125) Change in holding period gain/loss on marketalbe securities (18) 88 --------------- --------------- Net cash provided (used) by investing activities 1,162 (436) Cash flows from financing activities: Principal payments on capital lease obligations - 56 Increase in common stock 137 - --------------- --------------- Net cash provided (used) by financing activities 137 56 --------------- --------------- Net increase (decrease) in cash and cash equivalents (1,273) 1,522 Cash and cash equivalents at beginning of year 2,977 3,527 --------------- --------------- Cash and cash equivalents at end of period $ 1,704 $ 5,049 =============== =============== Supplemental Disclosure of Cash Flow Information: Income taxes paid 472 - Income taxes refunded 8 -
The accompanying notes are an integral part of these consolidated financial statements. 5 INTERPHASE CORPORATION NOTES TO CONSOLIDATED INTERIM FINANCIAL STATEMENTS 1. BASIS OF PRESENTATION The accompanying consolidated interim financial statements include the accounts of Interphase Corporation and its wholly owned subsidiary. Significant intercompany accounts and transactions have been eliminated. Effective January 31, 1996 the Company changed its fiscal year end from October 31 to December 31. For comparison purposes, results for the quarter ended March 31, 1996, are being compared with results from the prior year quarter ended April 30, 1995. The Company has not recast the prior year financial information presented herein to conform to the new fiscal quarter ends, as management does not believe such recasting would be as meaningful for comparative purposes, as the April 30, 1995 information presented herein. Management believes the April 30, 1995 results are the most comparable to the quarter ended March 31, 1996 results, particularly for comparing trends in operations. While the accompanying interim financial statements are unaudited, they have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of the Company, all material adjustments and disclosures necessary to fairly present the results of such periods have been made. Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. These financial statements should be read in conjunction with the consolidated financial statements and notes thereto for the year ended October 31, 1995. 2. NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE Net income per common and common equivalent share is computed using the weighted average number of outstanding shares and common equivalent shares. The dilutive impact of outstanding stock options have been considered under the treasury stock method using the greater of the average bid price or closing bid price for the period. Weighted average common and common equivalent shares: Three Months Ended: March 31, April 30, (in thousands) 1996 1995 ------- ------ Outstanding 4,683 4,535 Stock options 381 438 ------- ------ Total 5,064 4,973 ======= ===== 6 Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS Revenues for the three months ended March 31, 1996 increased $404,000 or approximately 4% to $11,877,000 as compared to $11,473,000 for the three month period ended April 30, 1995. Networking products represented a growth of 18% over the three month period ended April 30, 1995. FDDI product revenues declined 3%, while Ethernet increased 26% and ATM increased 132%. Networking products in total comprised 72% of total revenues for the first quarter of 1996, as compared to 64% for the three month period ended April 30, 1995. FDDI, Ethernet and ATM represented 45% , 16% and 8% of total revenues, respectively for the period ended March 31, 1996. Mass storage product revenues, primarily SCSI adapter cards, decreased 19% in 1996 compared to the three month period ended April 30, 1995. Mass storage products comprised 24% of total revenues in 1996 compared to 30% for the three month period ended April 30, 1995. Geographically, North America revenues comprised 89% of consolidated revenues in the first quarter of 1996 compared to 87% for the three month period April 30, 1995. European revenues comprised 7% of consolidated revenues in the first quarter of 1996 compared to 9% for the three month period ended April 30, 1995. Pacific Rim revenues comprised 4% of consolidated revenues in the first quarter of 1996 compared to 4% for the three month period ended April 30, 1995. The gross margin percentage for the three months ended March 31, 1996 was approximately 52% as compared to approximately 50% for the three month period ended April 30, 1995. Operating expenses for the three month period ended March 31, 1996 were $5,346,000 representing approximately 45% of consolidated revenue, as compared to 43% for the three month period ended April 30, 1995. The increased spending is primarily the result of additional research and development expenditures. LIQUIDITY AND CAPITAL RESOURCES The Company's cash , cash equivalents and marketable securities aggregated $9,017,000 at March 31, 1996, and $12,686,000 at October 31, 1995. The decrease in cash position is primarily the result of funding on going operations, an increase in inventory and an increase in accounts receivable since October 31, 1995. The Company expects that its cash, cash equivalents and marketable securities will be adequate to meet foreseeable needs for the next 12 months. 7 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 thereunto duly authorized. INTERPHASE CORPORATION (Registrant) Date: May 14, 1996 /s/ Robert L. Drury ------------------- Robert L. Drury Chief Financial Officer and Vice President Finance (Principal Financial and Accounting officer) 8 EX-27 2
5 1000 3-MOS DEC-31-1996 JAN-01-1996 MAR-31-1996 1,704 7,313 8,758 238 9,065 28,211 14,746 9,452 34,482 4,367 0 0 0 24,331 5,692 34,482 11,877 11,877 5,686 5,686 5,346 0 0 1,007 363 644 0 0 0 644 0 0.13
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