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Peerless Systems Corp. Reports Operating Results (10-Q)

September 14, 2010 | About:
10qk

10qk

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Peerless Systems Corp. (PRLS) filed Quarterly Report for the period ended 2010-07-31.

Peerless Systems Corp. has a market cap of $51.6 million; its shares were traded at around $3.22 with a P/E ratio of 10.1 and P/S ratio of 10.7. PRLS is in the portfolios of Jim Simons of Renaissance Technologies LLC, John Rogers of ARIEL CAPITAL MANAGEMENT LLC.

Highlight of Business Operations:

Our total assets at July 31, 2010 were $55.7 million, a decrease of 1.2% from $56.4 million as of January 31, 2010. Stockholders equity at July 31, 2010 was $53.0 million, an increase of 0.9% from $52.6 million as of January 31, 2010. Our ratio of current assets to current liabilities was 48.9:1, which is an increase from the 17.7:1 ratio as of January 31, 2010. Our operations provided $2.0 million mainly because of the dividends received for the investment in Highbury Financial, Inc. during the six months ended July 31, 2010, compared to $1.9 million in cash used by operations during the six months ended July 31, 2009.

Consolidated revenues were $0.8 million for the second quarter of fiscal year 2011, compared to $2.1 million for the second quarter of fiscal year 2010. We experienced a decline in licensing revenues because no new block licenses were signed during the second quarter of fiscal year 2011 versus the $1.0 million block signed during the second quarter of fiscal year 2010. Engineering services and maintenance revenues were $0 and $0.2 million, for the second quarter of fiscal year 2011 and 2010, respectively. The decrease was due to the expiration of service and maintenance contracts with customers which we decided not to renew.

Total operating expenses increased 127% to $0.8 million, compared with $(2.7) million. The increase was primarily due to the early release of the escrow payment of $3.8 million during the second quarter of fiscal year 2010. Excluding this transaction, the total operating expense decreased by 29% to $0.8 million in the second quarter of fiscal year 2011, compared with $1.0 million in the same quarter last year.

Our net income in the first six months of fiscal year 2011 was $3.2 million, or $0.20 per basic and diluted share, compared to a net income of $3.5 million, or $0.21 per basic and diluted share, in the first six months of fiscal year 2010.

Consolidated revenues were $1.7 million for the first six months of fiscal year 2011, compared to $3.0 million for the first six months of fiscal year 2010. Licensing revenues decreased $1.1 million in the first six months of fiscal year 2011 primarily resulting from a decline in the demand for the technologies we license. Engineering services and maintenance revenues decreased $0.2 million, primarily as a result of the expiration of service and maintenance contracts which we decided not to renew.

Total cost of revenues was $0.5 million in the first six months of fiscal year 2011, compared to a gain of $1.5 million in the first six months of fiscal year 2010. Product licensing costs increased $2.0 million in the first six months of fiscal year 2011 primarily resulting from the reversal of accrued licensing cost of $2.6 million during the first quarter of fiscal year 2010. Excluding this reversal, product licensing costs decreased by $0.6 million to $0.3 million in the first six months of fiscal year 2011, from $0.9 million in fiscal year 2010 which was primarily a result of the lower mix of products being sold for which we pay license fees to a third party. Engineering services and maintenance costs in the first six months of fiscal year 2011 and 2010 were $0.1 and $0.3 million, respectively.

Read the The complete Report

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