COMARCO Inc. (CMRO, Financial) filed Quarterly Report for the period ended 2010-07-31.
Comarco Inc. has a market cap of $18.24 million; its shares were traded at around $2.49 with and P/S ratio of 0.69. Comarco Inc. had an annual average earning growth of 57.7% over the past 5 years.
Cost of revenue for the three and six months ended July 31, 2010 increased by $5.0 million, or 88 percent, and $8.6 million, or 107 percent, respectively, compared to the corresponding periods of fiscal 2010. These increases are primarily attributable to the increases in sales for the three and six months ended July 31, 2010 compared to the comparable prior year periods. When expressed as a percentage of revenue, product costs increased to 70 percent for the three month period ended July 31, 2010 compared to 66 percent for the comparable prior year period due to increased sales to OEM customers. The margins for products distributed into retail channels through our exclusive relationship with Targus are higher when compared to products developed for OEM customers due to certain design requirements of our OEM customers. During the three and six months ended July 31, 2010 we incurred freight expedite and other charges of $0.6 million and $0.7 million, respectively. We had no similar costs in the corresponding periods of the prior year. These costs were incurred to expedite delivery of Manhattan units to Targus, primarily as a result of our temporary production cessation which occurred in the first quarter of fiscal 2011 previously described. These costs adversely impacted the gross margin by 4 percentage points during the three and six months ended July 31, 2010. During the three and six months ended July 31, 2010, our fixed supply chain overhead costs increased by $0.4 million and $0.6 million or 69 percent and 50 percent, respectively, when compared to the fixed supply chain overhead costs in the comparable prior year periods. These increases are due to additional personnel needed to assist with procurement of component inventory that has become increasingly difficult to source at our desired prices and within our desired lead times. We also have added staff to assist with the management of our growing number of contract manufacturers.
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Comarco Inc. has a market cap of $18.24 million; its shares were traded at around $2.49 with and P/S ratio of 0.69. Comarco Inc. had an annual average earning growth of 57.7% over the past 5 years.
Highlight of Business Operations:
Revenue for the three and six months ended July 31, 2010 increased by $5.2 million, or 69 percent, and $10.7 million, or 111 percent, respectively, compared to the corresponding periods of fiscal 2010. The increase is attributable to increases in revenue relating to shipments to Targus during fiscal 2011. As previously discussed, during the latter part of the first quarter of fiscal 2011, Comarco ceased production of its Manhattan product to allow time to verify that the product did not contain defects similar to the one which caused the Recall. Comarco successfully completed its verification process and resumed manufacturing and volume shipping Manhattan units late in the first quarter. This production cessation created a backlog of demand which we filled in the second quarter. Additionally, revenue to Lenovo increased during the three and six months ended July 31, 2010 compared to the corresponding periods of the prior fiscal year. This is due, in part, to the introduction of the Y-cable pairing with the new ultra slim and light product in the current fiscal year. Finally, during the second quarter of fiscal 2011 we began shipments of a 90-watt auto-air DC adapter to Dell.Cost of revenue for the three and six months ended July 31, 2010 increased by $5.0 million, or 88 percent, and $8.6 million, or 107 percent, respectively, compared to the corresponding periods of fiscal 2010. These increases are primarily attributable to the increases in sales for the three and six months ended July 31, 2010 compared to the comparable prior year periods. When expressed as a percentage of revenue, product costs increased to 70 percent for the three month period ended July 31, 2010 compared to 66 percent for the comparable prior year period due to increased sales to OEM customers. The margins for products distributed into retail channels through our exclusive relationship with Targus are higher when compared to products developed for OEM customers due to certain design requirements of our OEM customers. During the three and six months ended July 31, 2010 we incurred freight expedite and other charges of $0.6 million and $0.7 million, respectively. We had no similar costs in the corresponding periods of the prior year. These costs were incurred to expedite delivery of Manhattan units to Targus, primarily as a result of our temporary production cessation which occurred in the first quarter of fiscal 2011 previously described. These costs adversely impacted the gross margin by 4 percentage points during the three and six months ended July 31, 2010. During the three and six months ended July 31, 2010, our fixed supply chain overhead costs increased by $0.4 million and $0.6 million or 69 percent and 50 percent, respectively, when compared to the fixed supply chain overhead costs in the comparable prior year periods. These increases are due to additional personnel needed to assist with procurement of component inventory that has become increasingly difficult to source at our desired prices and within our desired lead times. We also have added staff to assist with the management of our growing number of contract manufacturers.
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