Csp Inc. has a market cap of $15.2 million; its shares were traded at around $4.2301 with and P/S ratio of 0.2. CSPI is in the portfolios of John Buckingham of Al Frank Asset Management, Inc., John Rogers of ARIEL CAPITAL MANAGEMENT LLC.
Highlight of Business Operations:As shown above, total revenues decreased by approximately $4.0 million, or 9%, for the six months ended March 31, 2010 compared to the same period of fiscal year 2009. Revenue in the Systems segment increased for the current year six month period versus the prior year six month period by approximately $737 thousand, while revenues in the Service and System Integration segment decreased by approximately $4.7 million, resulting in the overall decrease of approximately $4.0 million.
The increase in the Systems segment product revenues of approximately $2.0 million for the six months ended March 31, 2010 versus the comparable period in fiscal 2009 was primarily the result of the sale of two large systems to Raytheon which totaled approximately $3.6 million compared to virtually no sales to Raytheon in the prior year six month period. In addition, product sales to Kyokuto Boeki Kaisha (“KBK”) increased by approximately $840 thousand. Offsetting these increases, product sales to Lockheed Martin and BAE decreased by approximately $1.8 million and $600 thousand, respectively.
The decrease in the Service and System Integration segment product sales of approximately $3.3 million was due to decreased product sales in the U.S. division of the segment of approximately $2.0 million, and a decrease of approximately $1.2 million in the segment s German division. The decrease in the U.S. was primarily attributable to the loss of a major customer, which filed for bankruptcy protection during the prior fiscal year. Product sales to this customer for the fiscal six months ended March 31, 2009 were $2.6 million. The decrease in Germany was from lower sales volume of approximately $1.8 million in constant dollars, offset by a favorable exchange rate fluctuation of the stronger Euro versus the U.S. Dollar of $600 thousand. The decrease in product sales volume from the German division was due primarily to the overall economic and technology sector slowdown which is continuing to put downward pressure on sales volume.
The $1.2 million decrease in Systems segment service revenue was the result of a decrease in royalty revenue from Lockheed Martin which was approximately $1.6 million for the six months ended March 31, 2009, and approximately $252 thousand for the six months ended March 31, 2010, for a total decrease of approximately $1.3 million.
The decrease in the Service and System Integration segment service revenue was driven by lower service revenues from the segment s U.S., German and United Kingdom divisions which decreased by approximately $772 thousand, $372 thousand and approximately $283 thousand, respectively. The decrease from the U.S. division was due in part to the loss of the same customer as described above due to bankruptcy, which accounted for approximately $312 thousand of the decrease and unfavorable economic conditions which resulted in decreased spending by our customers and potential customers on information technology projects. The decrease in service revenue from our German and United Kingdom divisions was also attributed to the unfavorable economic conditions which negatively impacted those divisions revenue performance similarly.
The decrease in Americas revenue for the six months ended March, 31 2010 versus the six months ended March, 31, 2009 was primarily the result of the decrease in revenues from the U.S. operations of the Service and System integration segment. The decrease in sales in Europe was primarily the result of lower sales from the German and United Kingdom divisions of the Service and System Integration segment, where sales in Europe decreased by approximately $1.6 million and $382 thousand, respectively. The impact of the stronger Euro versus the U.S. dollar for the six months ended March 31, 2010 versus the six months ended March 31, 2009 had a favorable impact on European sales, when comparing to the prior year six months, of approximately $1.0 million. Therefore the decrease in sales volume in constant U.S. dollars for the fiscal six months ended March 31, 2010 versus the same six months in 2009 was approximately $2.8 million,
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