Interphase Corp. (INPH, Financial) filed Quarterly Report for the period ended 2009-06-30.
Interphase Corporation designs develops manufactures markets and supports high-performance connectivity products utilizing advanced technologies for today\'s enterprise network and mass storage environments and other embedded computer systems. Interphase\'s network and mass storage products include high performance adapter cards concentrators switches network operating system software drivers and management software applications. Interphase Corp. has a market cap of $34 million; its shares were traded at around $4.93 with and P/S ratio of 1.3.
Total revenue increased to $16.5 million for the six months ended June 30, 2009, compared to $14.1 million in the comparable period for the prior year. The increase in revenue is primarily attributable to our broadband telecom revenues, which increased approximately 27% to $15.2 million for the six months ended June 30, 2009, compared to $12.0 million for the same period in the prior year. Our professional services revenues increased significantly to $506,000 for the six months ended June 30, 2009, compared to $138,000 in the comparable period in the prior year. Our enterprise product revenues decreased by approximately 31% to $434,000, compared to $629,000 for the same period in the prior year. Included in revenues for the first six months of 2008 was a one-time project cancellation fee of $973,000 recorded in the first quarter of 2008 for unique customer requirements for product development work that was discontinued. All other revenues decreased approximately 6% to $382,000 for the six months ended June 30, 2009 from $406,000 for the six months ended June 30, 2008.
Sales and marketing expenses were $3.1 million and $2.7 million for the six months ended June 30, 2009 and 2008, respectively. The increase in sales and marketing expense is primarily due to increased headcount in business development, product management and marketing. The increased headcount resulted in an increase in sales and marketing expense of approximately $360,000 for the six months ended June 30, 2009 compated to the same period in 2008. Additionally, sales and marketing expense increased as a result of increased commission and variable compensation expense of approximately $315,000 as a result of higher revenues for the first six months of 2009, compared to the same period in 2008. These two increases were partially offset by a significantly stronger Dollar against the Euro in 2009 resulting in a decrease to sales and marketing expense of approximately $140,000 for the six months ended June 30, 2009, compared to the same period last year. Additionally, sales and marketing expenses decreased as a result of the restructuring plan we undertook in the first quarter of 2008 resulting in a reduction of headcount expenses of approximately $138,000 in the first six months of 2009 compared to the same period in 2008. See Note 7 in the Notes to Condensed Consolidated Financial Statements for more information. As a percentage of total revenue, sales and marketing expense was approximately 19% for both the six months ended June 30, 2009 and 2008.
Other loss, net, was $3,000 and $6,000 for the three and six months ended June 30, 2009, respectively. Other income, net was $22,000 and $325,000 for the three and six months ended June 30, 2008, respectively. The other loss, net during the periods presented for 2009 primarily relates to changes in foreign currency related to supplier invoices. During 2008, the other income, net was the result of the change in market value of our foreign exchange derivative financial instruments which resulted in income of approximately $30,000 and $346,000 for the three months and six months ended June 30, 2009, respectively. During, the three and six months ended June 30, 2009, we have had no such foreign exchange derivative financial instruments. See Note 5 in the Notes to Condensed Consolidated Financial Statements for more information.
We reported a net income of $74,000 for the three months ended June 30, 2009 and net loss of $1.2 million for the three months ended June 30, 2008. Basic and diluted earnings per share for the three months ended June 30, 2009 was $0.01. Basic loss per share for the three months ended June 30, 2008 was ($0.18). The Company reported a net income of $781,000 and a net loss of $1.7 million for the six months ended June 30, 2009 and June 30, 2008, respectively. Basic and diluted earnings per share for the six months ended June 30, 2009 was $0.11. Basic loss per share for the six months ended June 30, 2008 was ($0.26).
Cash provided by investing activities totaled $2.0 million for the six months ended June 30, 2009, primarily driven by the sale of marketable securities. Cash used in investing activities totaled $260,000 for the six months ended June 30, 2008. Cash provided by or used in investing activities in each of the periods presented related principally to proceeds from the sale of marketable securities, disbursements for additions to property and equipment, capitalized software and our investments in marketable securities. Additions to property and equipment and capitalized software were $202,000 for the six months ended June 30, 2009 compared to $253,000 for the six months ended June 30, 2008. The additions for the six months ended June 30, 2009 primarily related to enhancements to our enterprise performance management system and software purchases for our engineering function. The additions for the six months ended June 30, 2008 primarily related to software and equipment purchases for our engineering and manufacturing functions. Purchases of marketable securities were $2.9 million and $4.8 million for the six months ended June 30, 2009 and 2008, respectively. Proceeds from the sale of marketable securities increased to $5.2 million for the six months ended June 30, 2009 compared to $4.8 million for the same period in 2008.
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Interphase Corporation designs develops manufactures markets and supports high-performance connectivity products utilizing advanced technologies for today\'s enterprise network and mass storage environments and other embedded computer systems. Interphase\'s network and mass storage products include high performance adapter cards concentrators switches network operating system software drivers and management software applications. Interphase Corp. has a market cap of $34 million; its shares were traded at around $4.93 with and P/S ratio of 1.3.
Highlight of Business Operations:
Total revenue increased to $8.1 million for the three months ended June 30, 2009, compared to $6.7 million for the same period in the prior year. The increase was primarily attributable to broadband telecom revenue, which increased approximately 17% to $7.2 million for the three months ended June 30, 2009, compared to $6.2 million in the comparable period in the prior year. Our professional services revenue increased significantly to $257,000 for the three months ended June 30, 2009, compared to $21,000 in the comparable period in the prior year. Our enterprise product revenue increased 76% to $345,000 for the three months ended June 30, 2009, compared to $196,000 for the same period in the prior year. All other revenues, increased 22% to $289,000 for the three months ended June 30, 2009, compared to $237,000 for the same period in the prior year.Total revenue increased to $16.5 million for the six months ended June 30, 2009, compared to $14.1 million in the comparable period for the prior year. The increase in revenue is primarily attributable to our broadband telecom revenues, which increased approximately 27% to $15.2 million for the six months ended June 30, 2009, compared to $12.0 million for the same period in the prior year. Our professional services revenues increased significantly to $506,000 for the six months ended June 30, 2009, compared to $138,000 in the comparable period in the prior year. Our enterprise product revenues decreased by approximately 31% to $434,000, compared to $629,000 for the same period in the prior year. Included in revenues for the first six months of 2008 was a one-time project cancellation fee of $973,000 recorded in the first quarter of 2008 for unique customer requirements for product development work that was discontinued. All other revenues decreased approximately 6% to $382,000 for the six months ended June 30, 2009 from $406,000 for the six months ended June 30, 2008.
Sales and marketing expenses were $3.1 million and $2.7 million for the six months ended June 30, 2009 and 2008, respectively. The increase in sales and marketing expense is primarily due to increased headcount in business development, product management and marketing. The increased headcount resulted in an increase in sales and marketing expense of approximately $360,000 for the six months ended June 30, 2009 compated to the same period in 2008. Additionally, sales and marketing expense increased as a result of increased commission and variable compensation expense of approximately $315,000 as a result of higher revenues for the first six months of 2009, compared to the same period in 2008. These two increases were partially offset by a significantly stronger Dollar against the Euro in 2009 resulting in a decrease to sales and marketing expense of approximately $140,000 for the six months ended June 30, 2009, compared to the same period last year. Additionally, sales and marketing expenses decreased as a result of the restructuring plan we undertook in the first quarter of 2008 resulting in a reduction of headcount expenses of approximately $138,000 in the first six months of 2009 compared to the same period in 2008. See Note 7 in the Notes to Condensed Consolidated Financial Statements for more information. As a percentage of total revenue, sales and marketing expense was approximately 19% for both the six months ended June 30, 2009 and 2008.
Other loss, net, was $3,000 and $6,000 for the three and six months ended June 30, 2009, respectively. Other income, net was $22,000 and $325,000 for the three and six months ended June 30, 2008, respectively. The other loss, net during the periods presented for 2009 primarily relates to changes in foreign currency related to supplier invoices. During 2008, the other income, net was the result of the change in market value of our foreign exchange derivative financial instruments which resulted in income of approximately $30,000 and $346,000 for the three months and six months ended June 30, 2009, respectively. During, the three and six months ended June 30, 2009, we have had no such foreign exchange derivative financial instruments. See Note 5 in the Notes to Condensed Consolidated Financial Statements for more information.
We reported a net income of $74,000 for the three months ended June 30, 2009 and net loss of $1.2 million for the three months ended June 30, 2008. Basic and diluted earnings per share for the three months ended June 30, 2009 was $0.01. Basic loss per share for the three months ended June 30, 2008 was ($0.18). The Company reported a net income of $781,000 and a net loss of $1.7 million for the six months ended June 30, 2009 and June 30, 2008, respectively. Basic and diluted earnings per share for the six months ended June 30, 2009 was $0.11. Basic loss per share for the six months ended June 30, 2008 was ($0.26).
Cash provided by investing activities totaled $2.0 million for the six months ended June 30, 2009, primarily driven by the sale of marketable securities. Cash used in investing activities totaled $260,000 for the six months ended June 30, 2008. Cash provided by or used in investing activities in each of the periods presented related principally to proceeds from the sale of marketable securities, disbursements for additions to property and equipment, capitalized software and our investments in marketable securities. Additions to property and equipment and capitalized software were $202,000 for the six months ended June 30, 2009 compared to $253,000 for the six months ended June 30, 2008. The additions for the six months ended June 30, 2009 primarily related to enhancements to our enterprise performance management system and software purchases for our engineering function. The additions for the six months ended June 30, 2008 primarily related to software and equipment purchases for our engineering and manufacturing functions. Purchases of marketable securities were $2.9 million and $4.8 million for the six months ended June 30, 2009 and 2008, respectively. Proceeds from the sale of marketable securities increased to $5.2 million for the six months ended June 30, 2009 compared to $4.8 million for the same period in 2008.
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