Calamp Corp. has a market cap of $87.2 million; its shares were traded at around $3.1 with and P/S ratio of 0.8. CAMP is in the portfolios of Jim Simons of Renaissance Technologies LLC.
Highlight of Business Operations:Consolidated selling expense was $2.5 million for both of the third quarters of fiscal 2011 and 2010. For the nine-month year-to-date periods, selling expenses increased by $750,000 from $7,120,000 last year to $7,870,000 this year. The year-over-year increase is due primarily to higher incentive and commission expense on the higher Wireless DataCom revenue level, increased salaries expense and higher travel expenses.
Consolidated general and administrative (G&A) expense declined by $772,000 to $1,981,000 in the third quarter of this year compared to the prior year. For the nine-month periods, consolidated G&A expense decreased by $1.3 million to $6.7 million for fiscal 2011 from $8.0 million last year. Legal expense was $490,000 lower during the third quarter of this year compared to the same period of the prior year due in part to a $230,000 indemnification settlement entered into with another company involving legal defense costs. Also contributing to the decrease in G&A expense were lower payroll costs due to workforce reductions and other cost cutting actions implemented by the Company.
Amortization of intangibles decreased from $342,000 in the third quarter of last year to $275,000 in the third quarter of this year. The reduction is attributable to some intangible assets becoming fully amortized during the nine-month period of this year. For the nine-month periods, amortization of intangibles decreased to $857,000 from $1,025,000 last year.
Non-operating expense was $1,084,000 in the nine months ended November 30, 2010, compared to non-operating expense of $1,888,000 in the nine months ended November 30, 2009. The decrease was due primarily to a loss of $1.0 million on the sale of an investment in the preferred stock of a privately held company last year and the $251,000 reduction of foreign currency losses from $255,000 last year to $4,000 this year, partially offset by an increase in net interest expense of $468,000. The increase in net interest expense was due to the reasons cited above.
The Companys primary sources of liquidity are its cash and cash equivalents, which amounted to $4,251,000 at November 30, 2010, and the working capital line of credit with Square 1 Bank. During the nine months ended November 30, 2010, cash and cash equivalents increased by $1,265,000. Cash was provided by operations in the amount of $806,000, net borrowings on the bank line of credit of $1,398,000 and collections on a note receivable of $348,000, partially offset by capital expenditures of $884,000 and employee withholding taxes paid related to net share settlement of vested equity awards of $403,000.
The Company operates internationally, giving rise to exposure to market risks from changes in foreign exchange rates. A cumulative foreign currency translation loss of $866,000 related to the Companys Canadian and French subsidiaries is included in accumulated other comprehensive loss in the stockholders equity section of the consolidated balance sheet at November 30, 2010 and February 28, 2010. Foreign currency gains (losses) of $37,000 and ($10,000) were included in the consolidated statements of operations for the three months ended November 30, 2010 and 2009, respectively. Foreign currency losses of $4,000 and $255,000 were included in the consolidated statements of operations for the nine months ended November 30, 2010 and 2009, respectively.
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