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Westell Technologies Inc. Reports Operating Results (10-Q)

October 22, 2010 | About:
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10qk

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Westell Technologies Inc. (WSTL) filed Quarterly Report for the period ended 2010-09-30.

Westell Technologies Inc. has a market cap of $161.8 million; its shares were traded at around $2.4 with a P/E ratio of 12.7 and P/S ratio of 0.8. WSTL is in the portfolios of Chuck Royce of Royce& Associates.

Highlight of Business Operations:

OSP revenue increased by 24% and 19% in the three and six months ended September 30, 2010, respectively, compared to the same periods last year due primarily to strong demand for products used in cellular backhaul initiatives.

Sales and marketing expense in the CNS segment decreased by 7% and 11% in the three and six months ended September 30, 2010, respectively, compared to the same periods last year due primarily to lower warranty expenses and the resource transfer noted above.

Research and development expenses in the CNS segment decreased by 15% and 19% in the three and six months ended September 30, 2010, respectively, compared to the same periods in the prior fiscal year. The reduction was primarily due to lower salary and related costs due to the personnel changes noted above, and a general reduction in overall expenses, including depreciation.

Research and development expenses in the OSP segment increased by 54% and 60% in the three and six months ended September 30, 2010, respectively, compared to the same periods in the prior fiscal year. The increase resulted from the personnel changes noted above, the hiring of new employees, increased prototype expense and $120,000 of software license expense all incurred to support the development of Ethernet products.

Research and development expense in the Conference Plus segment increased by 16% and 9% in the three and six months ended September 30, 2010, respectively, compared to the same periods in the prior year due primarily to a reallocation of employee resources from information technology which is a part of general and administrative expense.

CNS general and administrative expense decreased by 18% and 14% in the three and six months ended September 30, 2010, respectively, compared to the same periods in the prior fiscal year. OSP general and administrative expense decreased by 15% in the quarter ended September 30, 2010 compared to the same period in the prior fiscal year. CNS and OSP share certain general and administrative resources. The CNS segment received 62% and 65% of these resource costs and the OSP segment has been allocated 38% and 35% of the costs in fiscal years 2011 and 2010, respectively. General and administrative costs in the combined CNS and OSP segments were down in the three and six months ended September 30, 2010, respectively, compared to the same periods in the prior fiscal year due primarily to lower depreciation expense.

Read the The complete Report

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