COMARCO Inc. (CMRO, Financial) filed Quarterly Report for the period ended 2009-07-31.
Comarco Inc. provides test and optimization products and services for wireless telephone carriers systems for the wireless transmission of voice and data and advanced technology products for portable wireless appliances such as notebook computers cellular telephones and personal organizers. (press release) Comarco Inc. has a market cap of $20.22 million; its shares were traded at around $2.76 with and P/S ratio of 1.5. Comarco Inc. had an annual average earning growth of 0.9% over the past 5 years.
Revenue for the three and six months ended July 31, 2009 increased by $4.4 million, or 140 percent, and $2.6 million, or 38 percent, respectively, compared to the corresponding periods of fiscal 2009. The increase is attributable to increases in revenue relating to shipments to Targus during the second quarter of fiscal 2010. In June, we began shipping a 90-watt AC adapter to Targus under the Targus Agreement. The number of units shipped to Lenovo decreased during the three and six months ended July 31, 2009 compared to the corresponding periods of the prior fiscal year resulting in declining revenue attributable to Lenovo during the three and six months ended July 31, 2009 compared to the comparable prior year periods. The Lenovo revenue decrease is due to reduced sales quantities of the current 90-watt slim and light product. We are preparing to ship a new product to Lenovo and we believe demand for the legacy slim and light product has declined in expectation of the release of the new product. We currently anticipate selling the new Lenovo product in the second half of the current fiscal year.
Cost of revenue for the three and six months ended July 31, 2009 increased by $2.3 million, or 70 percent, and $0.8 million, or 12 percent, respectively, compared to the corresponding periods of fiscal 2009. These increases are attributable to the increase in sales for the three and six months ended July 31, 2009 compared to the comparable prior year period. Gross margins improved with the introduction of the 90-watt AC product sold to Targus and the Company did not generate a positive gross margin on the sale of its ChargeSource® products until the second quarter of fiscal 2010. 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. Additionally, as revenues increased, combined gross margin improved over the three and six months ended July 31, 2009 compared to the corresponding prior year
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Comarco Inc. provides test and optimization products and services for wireless telephone carriers systems for the wireless transmission of voice and data and advanced technology products for portable wireless appliances such as notebook computers cellular telephones and personal organizers. (press release) Comarco Inc. has a market cap of $20.22 million; its shares were traded at around $2.76 with and P/S ratio of 1.5. Comarco Inc. had an annual average earning growth of 0.9% over the past 5 years.
Highlight of Business Operations:
The Company has experienced pre-tax losses from operations during the three and six months ended July 31, 2009 and 2008 totaling $0.6 million and $3.1 million and $3.5 million and $7.2 million, respectively. Further, the Company did not generate a positive gross margin on the sale of its ChargeSource® products until the second quarter of fiscal 2010. The Companys future is highly dependent on its ability to sell its products at a profit and its ultimate return to overall profitability. To accomplish this, the Company must increase the sales volumes of its current and newly designed ChargeSource® products to appropriately absorb fixed administrative and contract manufacturing overhead. The Company believes that it has begun to address this concern with its recently executed Strategic Product Development and Supply Agreement with Targus Group International, Inc., pursuant to which the Company began shipment of ChargeSource® products to Targus during the second quarter of fiscal 2010. Further, the Company must successfully reduce its unit costs with its third party contract manufacturers, for which negotiations are currently in process. The inability of the Company to successfully achieve these objectives will have a material adverse effect on the Companys operations and financial condition.Revenue for the three and six months ended July 31, 2009 increased by $4.4 million, or 140 percent, and $2.6 million, or 38 percent, respectively, compared to the corresponding periods of fiscal 2009. The increase is attributable to increases in revenue relating to shipments to Targus during the second quarter of fiscal 2010. In June, we began shipping a 90-watt AC adapter to Targus under the Targus Agreement. The number of units shipped to Lenovo decreased during the three and six months ended July 31, 2009 compared to the corresponding periods of the prior fiscal year resulting in declining revenue attributable to Lenovo during the three and six months ended July 31, 2009 compared to the comparable prior year periods. The Lenovo revenue decrease is due to reduced sales quantities of the current 90-watt slim and light product. We are preparing to ship a new product to Lenovo and we believe demand for the legacy slim and light product has declined in expectation of the release of the new product. We currently anticipate selling the new Lenovo product in the second half of the current fiscal year.
Cost of revenue for the three and six months ended July 31, 2009 increased by $2.3 million, or 70 percent, and $0.8 million, or 12 percent, respectively, compared to the corresponding periods of fiscal 2009. These increases are attributable to the increase in sales for the three and six months ended July 31, 2009 compared to the comparable prior year period. Gross margins improved with the introduction of the 90-watt AC product sold to Targus and the Company did not generate a positive gross margin on the sale of its ChargeSource® products until the second quarter of fiscal 2010. 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. Additionally, as revenues increased, combined gross margin improved over the three and six months ended July 31, 2009 compared to the corresponding prior year
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