Dataram Corp. (DRAM, Financial) filed Quarterly Report for the period ended 2010-10-31.
Dataram Corp. has a market cap of $15.87 million; its shares were traded at around $1.78 with and P/S ratio of 0.36. DRAM is in the portfolios of Jim Simons of Renaissance Technologies LLC.
activities totaled approximately $3,029,000. Net loss in the period was
approximately $2,954,000. Accounts payable decreased by approximately
$2,172,000, mainly the result of decreased inventories of approximately
$1,577,000. Accrued expense decreased by approximately $651,000, which was
primarily the result of the payment of an accrued contingently payable
acquisition price for MMB. Depreciation and amortization of approximately
$530,000 was recorded in fiscal 2011's first six months. Trade receivables
decreased by approximately $461,000. Non-cash stock-based compensation
expense of approximately $313,000 was also recorded.
Three months ended Six months ended
October 31, 2009 October 31, 2009
________________ ________________
United States $ 9,035,000 $ 16,280,000
Europe 919,000 2,376,000
Other (principally Asia Pacific Region) 719,000 1,207,000
________________ ________________
Consolidated $ 10,673,000 $ 19,863,000
= =
Research and development expense in fiscal 2011's second quarter and six
months was $865,000 and $1,760,000, respectively, versus $1,621,000 and
$2,495,000 in the same prior year periods. In the first quarter of the
prior fiscal year, the Company implemented a strategy to introduce new and
complementary products into its offerings portfolio. The Company is
currently focusing on the development of a line of high performance storage
caching products ("XcelaSAN"). XcelaSAN is a unique intelligent Storage Area
Network (SAN) optimization solution that delivers substantive application
performance improvement to applications such as Oracle, SQL and VMware.
XcelaSAN augments existing storage systems by transparently applying
intelligent caching algorithms that serve the most active block-level data
from high-speed storage, creating an intelligent, virtual solid state SAN.
As part of that strategy, in January 2009, the Company entered into a
software purchase and license agreement with another company whereby the
Company acquired the exclusive right to purchase specified software for a
price of $900,000 plus a contingent payment of $100,000. Fiscal 2010's
research and development expense includes $600,000 of expense related to
the Agreement, of which $300,000 was expensed in the first fiscal quarter
and $300,000 was expensed in the second fiscal quarter. The Company owns
the software. The software and the storage products, which incorporate the
software, are currently under development. We expect to make further
investments in this area.
Selling, general and administrative (S,G&A) expense in fiscal 2011's second
quarter and six months decreased by approximately $529,000 and $493,000
respectively, from the comparable prior year periods. The reduction in this
year's second quarter is the result of reduced compensation related expenses
of approximately $106,000. Stock option expense recorded as a component of
S,G&A expense was approximately $121,000 in the current fiscal year's
second quarter compared to $225,000 in the same prior year period.
Additionally, marketing expense for our traditional memory business were
approximately $94,000 less than the prior year second quarter.
Other income (expense), net for the second quarter and six months totaled
$51,000 and $160,000 of expense, respectively, for fiscal 2011, and
expense of $12,000 and $22,000, of income for the same respective periods in
fiscal 2010. Other expense in fiscal 2010's second quarter consisted
primarily of interest expense of $62,000 and $11,000 of foreign currency
transaction gains, primarily as a result of the EURO strengthening relative
to the US dollar. Six month other expense of $160,000 consisted of $79,000
of interest expense and $85,000 of foreign currency transaction losses,
primarily as a result of the EURO weakening relative to the US dollar. Other
expense in fiscal 2010's second quarter consisted primarily of $19,000 of
foreign currency transaction losses, primarily as a result of the EURO
weakening relative to the US dollar. There was also approximately $10,000 of
other income recorded related to a gain on an asset disposal. Six month
other income of $22,000 consisted primarily of $7,000 of net interest income
and $5,000 of foreign currency transaction gains, primarily as a result of
the EURO strengthening relative to the US dollar, and the aforementioned
gain on asset disposal.
Income tax benefit for the second quarter and six months of 2011 was nil
versus a benefit of $1,042,000 and $1,670,000, respectively, for the same
prior year periods. The Company utilizes the asset and liability method of
accounting for income taxes in accordance with the provisions of the
Expenses - Income Taxes Topic of the Financial Accounting Standards Board
(FASB) Accounting Standards Codification (ASC)(Codification). Under the
asset and liability method, deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable to
differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. A valuation allowance
is provided when the Company determines that it is more likely than not that
some portion or all of the deferred tax assets will not be realized. The
Company considers certain tax planning strategies in its assessment as to
the recoverability of its tax assets. In each reporting period, the Company
assesses, based on the weight of all evidence, both positive and negative,
whether a valuation allowance on its deferred tax assets is warranted. Based
on the assessment conducted in the Company's reporting period ended
January 31, 2010, the Company concluded that such an allowance was
warranted, and accordingly recorded a valuation allowance of approximately
$5.8 million in that reporting period. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those
temporary differences or tax attributes are expected to be recovered or
settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized in earnings in the period that the tax rate changes.
As of April 30, 2010 the Company had Federal and State net operating loss
(NOL) carry-forwards of approximately $11.5 million and $9.7 million,
respectively. These can be used to offset future taxable income and expire
between 2023 and 2030 for Federal tax purposes and 2016 and 2030 for state
tax purposes. As a result, the Company does not expect to record any income
tax expense (benefit) in fiscal 2011. The Company's NOL carry-forwards are a
component of its deferred tax assets which are reported net of a full
valuation allowance in the Company's consolidated financial statements at
October 31, 2010 and at April 30, 2010.
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Dataram Corp. has a market cap of $15.87 million; its shares were traded at around $1.78 with and P/S ratio of 0.36. DRAM is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:
During the first six months of fiscal 2011, net cash used in operatingactivities totaled approximately $3,029,000. Net loss in the period was
approximately $2,954,000. Accounts payable decreased by approximately
$2,172,000, mainly the result of decreased inventories of approximately
$1,577,000. Accrued expense decreased by approximately $651,000, which was
primarily the result of the payment of an accrued contingently payable
acquisition price for MMB. Depreciation and amortization of approximately
$530,000 was recorded in fiscal 2011's first six months. Trade receivables
decreased by approximately $461,000. Non-cash stock-based compensation
expense of approximately $313,000 was also recorded.
Three months ended Six months ended
October 31, 2009 October 31, 2009
________________ ________________
United States $ 9,035,000 $ 16,280,000
Europe 919,000 2,376,000
Other (principally Asia Pacific Region) 719,000 1,207,000
________________ ________________
Consolidated $ 10,673,000 $ 19,863,000
= =
Research and development expense in fiscal 2011's second quarter and six
months was $865,000 and $1,760,000, respectively, versus $1,621,000 and
$2,495,000 in the same prior year periods. In the first quarter of the
prior fiscal year, the Company implemented a strategy to introduce new and
complementary products into its offerings portfolio. The Company is
currently focusing on the development of a line of high performance storage
caching products ("XcelaSAN"). XcelaSAN is a unique intelligent Storage Area
Network (SAN) optimization solution that delivers substantive application
performance improvement to applications such as Oracle, SQL and VMware.
XcelaSAN augments existing storage systems by transparently applying
intelligent caching algorithms that serve the most active block-level data
from high-speed storage, creating an intelligent, virtual solid state SAN.
As part of that strategy, in January 2009, the Company entered into a
software purchase and license agreement with another company whereby the
Company acquired the exclusive right to purchase specified software for a
price of $900,000 plus a contingent payment of $100,000. Fiscal 2010's
research and development expense includes $600,000 of expense related to
the Agreement, of which $300,000 was expensed in the first fiscal quarter
and $300,000 was expensed in the second fiscal quarter. The Company owns
the software. The software and the storage products, which incorporate the
software, are currently under development. We expect to make further
investments in this area.
Selling, general and administrative (S,G&A) expense in fiscal 2011's second
quarter and six months decreased by approximately $529,000 and $493,000
respectively, from the comparable prior year periods. The reduction in this
year's second quarter is the result of reduced compensation related expenses
of approximately $106,000. Stock option expense recorded as a component of
S,G&A expense was approximately $121,000 in the current fiscal year's
second quarter compared to $225,000 in the same prior year period.
Additionally, marketing expense for our traditional memory business were
approximately $94,000 less than the prior year second quarter.
Other income (expense), net for the second quarter and six months totaled
$51,000 and $160,000 of expense, respectively, for fiscal 2011, and
expense of $12,000 and $22,000, of income for the same respective periods in
fiscal 2010. Other expense in fiscal 2010's second quarter consisted
primarily of interest expense of $62,000 and $11,000 of foreign currency
transaction gains, primarily as a result of the EURO strengthening relative
to the US dollar. Six month other expense of $160,000 consisted of $79,000
of interest expense and $85,000 of foreign currency transaction losses,
primarily as a result of the EURO weakening relative to the US dollar. Other
expense in fiscal 2010's second quarter consisted primarily of $19,000 of
foreign currency transaction losses, primarily as a result of the EURO
weakening relative to the US dollar. There was also approximately $10,000 of
other income recorded related to a gain on an asset disposal. Six month
other income of $22,000 consisted primarily of $7,000 of net interest income
and $5,000 of foreign currency transaction gains, primarily as a result of
the EURO strengthening relative to the US dollar, and the aforementioned
gain on asset disposal.
Income tax benefit for the second quarter and six months of 2011 was nil
versus a benefit of $1,042,000 and $1,670,000, respectively, for the same
prior year periods. The Company utilizes the asset and liability method of
accounting for income taxes in accordance with the provisions of the
Expenses - Income Taxes Topic of the Financial Accounting Standards Board
(FASB) Accounting Standards Codification (ASC)(Codification). Under the
asset and liability method, deferred tax assets and liabilities are
recognized for the estimated future tax consequences attributable to
differences between the financial statement carrying amounts of existing
assets and liabilities and their respective tax bases. A valuation allowance
is provided when the Company determines that it is more likely than not that
some portion or all of the deferred tax assets will not be realized. The
Company considers certain tax planning strategies in its assessment as to
the recoverability of its tax assets. In each reporting period, the Company
assesses, based on the weight of all evidence, both positive and negative,
whether a valuation allowance on its deferred tax assets is warranted. Based
on the assessment conducted in the Company's reporting period ended
January 31, 2010, the Company concluded that such an allowance was
warranted, and accordingly recorded a valuation allowance of approximately
$5.8 million in that reporting period. Deferred tax assets and liabilities
are measured using enacted tax rates in effect for the year in which those
temporary differences or tax attributes are expected to be recovered or
settled. The effect on deferred tax assets and liabilities of a change in
tax rates is recognized in earnings in the period that the tax rate changes.
As of April 30, 2010 the Company had Federal and State net operating loss
(NOL) carry-forwards of approximately $11.5 million and $9.7 million,
respectively. These can be used to offset future taxable income and expire
between 2023 and 2030 for Federal tax purposes and 2016 and 2030 for state
tax purposes. As a result, the Company does not expect to record any income
tax expense (benefit) in fiscal 2011. The Company's NOL carry-forwards are a
component of its deferred tax assets which are reported net of a full
valuation allowance in the Company's consolidated financial statements at
October 31, 2010 and at April 30, 2010.
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