Cubic Corp has a market cap of $1.36 billion; its shares were traded at around $51.02 with a P/E ratio of 19.4 and P/S ratio of 1.1. The dividend yield of Cubic Corp stocks is 0.4%. Cubic Corp had an annual average earning growth of 11% over the past 10 years. GuruFocus rated Cubic Corp the business predictability rank of 3-star.Hedge Fund Gurus that owns CUB: Jim Simons of Renaissance Technologies LLC, Bruce Kovner of Caxton Associates. Mutual Fund and Other Gurus that owns CUB: Chuck Royce of Royce& Associates, Murray Stahl of Horizon Asset Management.
Highlight of Business Operations:Operating income increased 33% to $27.2 million in the quarter compared to $20.4 million in the first quarter of last year. The increase came from all three business segments. Corporate and other costs for the quarter were $1.3 million in both years. These costs include investment in the development and marketing of new security related technologies of $0.3 million in the first quarter of fiscal 2011 and $0.4 million in 2010. Also included in the results of operations for the quarter were expenses we incurred related to the Abraxas acquisition of $0.7 million. However, largely offsetting these expenses was a decrease of $0.6 million in our estimated liability for contingent consideration related to an acquisition we made in 2010. See the segment discussions following for further analysis of segment operating income.
Net income for the first quarter of fiscal 2010 increased to $19.9 million, or 74 cents per share, compared to $13.7 million, or 51 cents per share last year. Net income increased for the quarter primarily due to the increase in operating income. Net income in the first quarter this year also benefited from the retroactive reinstatement of the U.S. research and development credit, which reduced the income tax provision by $1.5 million. Other income included a net foreign currency exchange loss of $0.1 million in the first quarter of this year compared to a gain of $0.4 million last year, before applicable income taxes.
Selling, general and administrative (SG&A) expenses increased in the first quarter this year to $37.0 million compared to $28.7 million last year. As a percentage of sales, SG&A expenses were 13.0% for the first quarter compared to 11.4% last year. The increase was due primarily to higher selling expenses in CDS. Company funded research and development expenditures increased to $6.3 million for the first quarter compared to $1.7 million last year, which mainly related to new defense technologies we are developing.
MSS operating income increased to $5.1 million in the first quarter this year from $4.0 million last year. Last years first quarter had included a provision of $2.0 million for a dispute with a customer over contract terms. We are continuing to pursue alternatives for a resolution to this matter that could lead to ultimate recovery of the full amount. At this time, however, we cannot quantify or determine the likelihood of recovery. Partially offsetting the improvement in operating income for the quarter over last year were expenses of $0.7 million incurred related to the acquisition of Abraxas. Operating income for MSS is net of amortization of intangible assets of $1.2 million in the first quarter of both years.
As reflected in the table above, total backlog increased $354.0 million and funded backlog increased $269.3 million. The majority of the CTS backlog increase was from a new contract awarded in Vancouver, which added $214.4 million. In addition, changes in exchange rates for the prevailing currency in our CTS foreign operations and the U.S. Dollar as of the end of the quarter increased backlog by approximately $22.0 million compared to September 30, 2010. The acquisition of Abraxas added $107.7 million to our total backlog. In MSS, the difference between total backlog and funded backlog represents options under multi-year service contracts. Funding for these contracts comes from annual operating budgets of the U.S. government and the options are normally exercised annually. We do not include options for the purchase of additional systems or equipment in backlog until exercised, nor do we include indefinite delivery, indefinite quantity contracts until an order is received.
Investing activities for the three-month period included the acquisition of Abraxas for $124.0 million and one other small defense systems company for $0.4 million, capital expenditures of $1.4 million, and proceeds from marketable securities of $30.9 million. Financing activities for the three-month period consisted of scheduled payments on our long-term debt of $4.1 million. We have a committed three-year revolving credit agreement with a group of financial institutions in the amount of $150 million, expiring in December 2012. As of December 31, 2010, there were no borrowings under this agreement; however, there were letters of credit outstanding under the agreement totaling $67.4 million, which reduce the available line of credit to $82.6 million.
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