- --------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-----------------
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended June 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File Number 0-27460
PERFORMANCE TECHNOLOGIES, INCORPORATED
(Exact name of registrant as specified in its charter)
-------------------
Delaware 16-1158413
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation of organization)
315 Science Parkway, Rochester New York 14620
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (716) 256-0200
-----------------------------
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No .
The number of shares outstanding of the registrant's common stock was 4,821,610
as of August 4, 1997.
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Cover Page of 13 Pages
1
<PAGE>
-
Performance Technologies, Incorporated and Subsidiaries
Index
Page
Part I. Financial Information
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1997
(unaudited) and December 31, 1996 3
Consolidated Statements of Income For The Three and Six
Months Ended June 30, 1997 and 1996 (unaudited) 4
Consolidated Statements of Cash Flows For The Six
Months Ended June 30, 1997 and 1996 (unaudited) 5
Notes to Consolidated Financial Statements For The Six
Months Ended June 30, 1997 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part II. Other Information
Item 4 Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
Signatures 13
2
<PAGE>
PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
<S> <C> <C>
June 30, December 31,
1997 1996
(unaudited)
------------- -------------
Current assets:
Cash and cash equivalents $ 6,312,000 $ 10,027,000
Marketable securities 11,100,000 6,102,000
Accounts receivable, net 3,643,000 3,234,000
Inventories, net - Note C 4,297,000 4,032,000
Prepaid expenses and other 418,000 284,000
Deferred taxes 419,000 419,000
------------- -------------
Total current assets 26,189,000 24,098,000
Equipment and improvements, net 1,141,000 1,267,000
Software development, net 790,000 549,000
Other assets 147,000 175,000
------------- -------------
Total assets $ 28,267,000 $ 26,089,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $ 12,000 $ 26,000
Accounts payable 1,053,000 953,000
Income taxes payable 84,000 23,000
Accrued expenses 1,817,000 2,131,000
------------- -------------
Total current liabilities 2,966,000 3,133,000
Long term debt, less current portion 24,000 30,000
Deferred taxes 219,000 219,000
------------- -------------
Total liabilities 3,209,000 3,382,000
------------- -------------
Stockholders' equity
Preferred stock
Common stock - - Note B 49,000 49,000
Additional paid-in capital 12,924,000 12,885,000
Retained earnings 12,242,000 9,930,000
Treasury stock (157,000) (157,000)
------------- -------------
Total stockholders' equity 25,058,000 22,707,000
------------- -------------
Total liabilities and stockholders' equity $ 28,267,000 $ 26,089,000
============= =============
</TABLE>
3
<PAGE>
PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
------------- ------------- ------------- -------------
Sales $ 7,539,000 $ 6,463,000 $ 14,973,000 $ 12,000,000
Cost of goods sold 3,025,000 2,742,000 6,357,000 5,106,000
------------- ------------- ------------- -------------
Gross profit 4,514,000 3,721,000 8,616,000 6,894,000
------------- ------------- ------------- -------------
Operating expenses:
Selling and marketing 1,102,000 889,000 2,010,000 1,569,000
Research and development 972,000 729,000 1,915,000 1,322,000
General and administrative 740,000 805,000 1,429,000 1,393,000
------------- ------------- ------------- -------------
Total operating expenses 2,814,000 2,423,000 5,354,000 4,284,000
------------- ------------- ------------- -------------
Income from operations 1,700,000 1,298,000 3,262,000 2,610,000
Other income (expense), net 237,000 175,000 467,000 307,000
------------- ------------- ------------- -------------
Income before taxes and minority interest 1,937,000 1,473,000 3,729,000 2,917,000
Provision for income taxes 737,000 558,000 1,417,000 1,086,000
------------- ------------- ------------- -------------
Income before minority interest 1,200,000 915,000 2,312,000 1,831,000
Minority interest (5,000) (24,000)
------------- ------------- ------------- -------------
Net income $ 1,200,000 $ 910,000 $ 2,312,000 $ 1,807,000
============= ============= ============= =============
Earnings per share $ .24 $ .18 $ .47 $ .38
============= ============= ============= =============
Pro forma earnings per share - Note E $ .16 $ .12 $ .31 $ .24
============= ============= ============= =============
Weighted average common and common
equivalent shares 4,939,000 4,968,000 4,928,000 4,721,000
============= ============= ============= =============
Pro forma weighted average common and
common equivalent shares - Note E 7,412,000 7,477,000 7,399,000 7,385,000
============= ============= ============= =============
</TABLE>
4
<PAGE>
PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE SIX MONTHS ENDED JUNE 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
Six Months Ended
June 30,
1997 1996
------------- ------------
Cash flows from operating activities
Net income $ 2,312,000 $ 1,807,000
Non-cash adjustments:
Depreciation and amortization 729,000 352,000
Other 10,000 (63,000)
Changes in operating assets and liabilities:
Accounts receivable (419,000) (684,000)
Inventories (265,000) (1,012,000)
Prepaid expenses and other (134,000) 152,000
Accounts payable 100,000 (248,000)
Accrued expenses (314,000) 332,000
Income taxes payable 61,000 118,000
------------- ------------
Net cash provided by operating activities 2,080,000 754,000
------------- ------------
Cash flows from investing activities
Cash purchases of equipment and improvements, net (416,000) (573,000)
Capitalized software development (400,000) (196,000)
Purchase of marketable securities (4,998,000)
Purchase of remaining shares in subsidiary (93,000)
------------- ------------
Net cash used by investing activities (5,814,000) (862,000)
------------- ------------
Cash flows from financing activities
Payments on capital lease obligations (15,000) (30,000)
Repayment of notes payable (5,000) (12,000)
Proceeds from issuance of common stock 39,000 11,413,000
------------- ------------
Net cash provided by financing activities 19,000 11,371,000
------------- ------------
Net increase (decrease) in cash (3,715,000) 11,263,000
Cash and cash equivalents at beginning of period 10,027,000 2,466,000
------------- ------------
Cash and cash equivalents at end of period $ 6,312,000 $ 13,729,000
============= ============
</TABLE>
5
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Notes to Consolidated Financial Statements
For The Six Months Ended June 30, 1997
(Unaudited)
Note - A The unaudited consolidated financial statements of Performance
Technologies, Incorporated and subsidiaries (the "Company") have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X of the Securities and Exchange Commission. Accordingly, the
consolidated financial statements do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. The results for the
interim periods are not necessarily indicative of the results to be expected for
the year. The accompanying consolidated financial statements should be read in
conjunction with the audited Consolidated Financial Statements of the Company as
of December 31, 1996, as reported in its Annual Report on Form 10-K filed with
the Securities and Exchange Commission.
Note - B There were 4,818,831 and 4,801,301 shares issued and outstanding (net
of treasury shares held) at June 30, 1997 and December 31, 1996, respectively,
of the Company's $.01 par value Common Stock. During the six months ended June
30, 1997, 17,530 common shares were issued upon the exercise of stock options.
Note - C Inventories consisted of the following at June 30, 1997 and
December 31, 1996:
<TABLE>
<CAPTION>
<S> <C> <C>
June 30, December 31,
1997 1996
----------- -----------
Purchased parts and components $ 1,336,000 $ 1,601,000
Work in process 3,078,000 2,641,000
Finished goods 435,000 292,000
----------- -----------
4,849,000 4,534,000
Less: reserve for inventory obsolescence (552,000) (502,000)
----------- -----------
Net $ 4,297,000 $ 4,032,000
=========== ===========
</TABLE>
Note - D The provisions of Statement of Financial Accounting Standards No. 128
("SFAS 128"), "Earnings per Share" are effective for financial statements issued
for interim and annual periods ending after December 15, 1997. SFAS 128
simplifies the standards for computing earnings per share and makes the United
States earnings per share accounting standard comparable to international
standards. The Company believes that the adoption of SFAS 128 would have
increased reported earnings per share by $.01 and $.02.
Note - E On July 31, 1997, the Company's Board of Directors authorized a
three-for-two stock split effected in the form of a 50% stock dividend to be
distributed on September 15, 1997 to stockholders of record and option holders
of record on August 29, 1997 . The effect of the stock split on the balance
sheet is estimated to be an issuance of an additional 2,400,000 shares.
6
<PAGE>
-
Performance Technologies, Incorporated and Subsidiaries
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The Company's operating performance is subject to various risks and
uncertainties. This report on Form 10-Q should be read in conjunction with the
consolidated financial statements, the notes thereto, Management's Discussion
and Analysis of Financial Condition and Results of Operations as of December 31,
1996 and "Risk Factors" as reported in the Company's Annual Report on Form 10-K
filed with the Securities and Exchange Commission.
Matters discussed in Management's Discussion and Analysis of Financial Condition
and Results of Operations in this Form 10-Q include forward looking statements
within the meaning of Section 27A of the Securities Act of 1933, as amended and
Section 21E of the Securities Act of 1934, as amended, and are subject to the
safe harbor provisions of those Sections. The Company's future operating results
could differ materially from those discussed in the forward looking statements
and may be affected by various trends and factors which are beyond the Company's
control. These include, among other factors, general business and economic
conditions, rapid or unexpected changes in technologies, cancellation or delay
of customer orders, changes in the product or customer mix of sales, delays in
new product development, customer acceptance of new products and customer delays
in qualification of products.
Overview
The Company achieved record sales and net income for the second quarter and for
the six months ended June 30, 1997. Net income for the second quarter 1997
increased by 32% to $1,200,000 and net income for the six months ended June 30,
1997 increased 28% to $2,312,000 as compared to 1996 periods. At June 30, 1997,
the Company had approximately $17.4 million in cash and marketable securities,
no significant debt and generated income from operations excluding depreciation
and amortization (EBITDA) for the six months ended June 30, 1997 of
approximately $4.0 million as compared to approximately $3.0 million for the
same period in 1996.
On July 31, 1997, the Company's Board of Directors authorized a three-for-two
stock split effected in the form of a 50% stock dividend to be distributed on
September 15, 1997 to stockholders of record on August 29, 1997. As a result of
the stock split, pro forma earnings per share for the three months ended June
30, 1997 and 1996 were $.16 and $.12, respectively, and pro forma earnings per
share for the six months ended June 30, 1997 and 1996 were $.31 and $.24,
respectively. The stock dividend will result in the issuance of approximately
2,400,000 additional common shares.
The Company's revenues are generated from products designed to enhance the
performance of network systems based on varied computer architectures including
VMEbus, SBus and PCIbus. The Company's products operate on various operating
systems including UNIX, Windows NT(TM), VxWorks and LINUX. During the first half
of 1997, the Company introduced a new family of PCIbus products including its
latest communications controller used for high speed T1/E1 connectivity in
remote access and telecommunications applications; the new ULTRA SCSI Host
Adapter offering up to 40 MBytes/sec SCSI performance; a high performance PCI
FDDI adapter with software for Windows NT(TM) and Solaris 2.X applications, and
a high performance 10/100 Fast Ethernet network interface card with PTI software
to run on Sun Microsystems' SPARCengine ULTRA(TM) 30 line of PCI workstations
and servers. At the present time, the Company offers three WAN, two LAN and two
Mass Storage products for the PCIbus market.
As part of the Company's continuing efforts to introduce new products and to
establish new relationships, the Company recently announced two significant
multi-year agreements. In June, the Company announced a multi-year agreement
with 3Com(TM) and began marketing 3Com's high-performance 10/100 Fast Ethernet
network interface cards with PTI software to its customers.
7
<PAGE>
In July, the Company announced a relationship with Sun Microsystems Inc. to
provide Sun Microsystems with a Wide Area Network connectivity product for
integration into Sun's newly announced line of PCI based UltraSPARC workstations
and servers. This high bandwidth communications adapter will provide Sun's PCI
based workstations and servers with connectivity to the Internet and to other
networks.
Product plans during the second half of 1997 include the introduction of a Fibre
Channel controller for the SBus and PCI markets, several new products for the
emerging CompactPCI market and a new family of network switching products.
Quarter and Six Months Ended June 30, 1997, compared with
the Quarter and Six Months Ended June 30, 1996
SALES. Sales for the second quarter of 1997 increased by $1,076,000
(16.6%) to $7,539,000, from $6,463,000 for the second quarter of 1996. Sales for
the six months ended June 30, 1997 increased by $2,973,000 (24.8%) to
$14,973,000, from $12,000,000 for the six months ended June 30, 1996. The
Company's products are grouped into five categories: WAN Interface Adapter
products, LAN Interface Adapter products, Network Systems products, Mass Storage
Interface products and Inter-system Connectivity products.
Shipments of WAN Adapter products amounted to 43% of sales during the second
quarter of 1997 and 1996. Shipments were 46% of sales for the six months ended
June 30, 1997 and were 44% of sales for the comparable 1996 period. Sales of WAN
products increased 55% during the first six months of 1997 over the respective
1996 period. This increase is attributable to greater acceptance of the
Company's WAN products in the marketplace, the introduction of several new WAN
products during the past year and several new OEM customers integrating these
products into their product applications.
Shipments of LAN Adapter products for the second quarter of 1997 amounted to 23%
of sales as compared to 26% for the second quarter of 1996, and were 19% of
sales for the six months ended June 30, 1997 as compared to 25% for the first
six months of 1996. The largest share of the Company's LAN business is in
connection with Commercial Off-the-Shelf (COTS) Defense applications. This
project-oriented business is difficult to predict on a quarterly basis. LAN
Adapter sales were up sharply in the second quarter from the first quarter and
management expects the volume of this business to meet or exceed last year's
level of sales.
Shipments of Network systems products represented 8% of total sales in the
second quarter of 1997 and 10% for same period in 1996. Network shipments were
12% of total sales for the six months ended June 30, 1997 as compared to 9%
during the period in 1996. For the second quarter of 1997, revenues from Network
Systems products decreased from the first quarter level because of a
customer/supplier design change on the Cray Research contract and a dip in the
Radar business in our UCONx subsidiary. The design change is expected to be
resolved during the third quarter and the Radar business is typically
project-oriented and can fluctuate from quarter to quarter.
Shipments of Mass Storage Interface products for the second quarter of 1997
amounted to 17% of sales as compared to 14% in the second quarter of 1996. For
the six months ended June 30, 1997, Mass Storage products were 16% of total
sales and 15% for the same 1996 period. Sales of Mass Storage Interface products
increased 42% for the six months ended June 30, 1997 over the respective 1996
period. This increase in sales reflects continued market acceptance of the
Company's Ultra SCSI interface product introduced in June 1996.
Shipments of Inter-system Connectivity products represented 9% of sales for the
second quarter of 1997 and 7% of total sales for the six months ended June 30,
1997 as compared to 7% for both of the 1996 periods. The Company is not
investing in this group of products and a modest decline in these revenues is
expected from last year's levels.
International sales amounted to 10% of sales in the first half of 1997 compared
to 11% of sales for all of 1996. Opening a direct sales office in the Pacific
Rim has been deferred until 1998.
8
<PAGE>
GROSS PROFIT. Gross profit consists of sales, less cost of goods sold
including materials costs, manufacturing expenses and amortization of software
development costs. Gross margin improved to 59.9% of sales for the second
quarter, from 57.6% in the second quarter of 1996. The improved margin is
primarily attributable to the mix of product shipments for the quarter. For the
first six months of 1997 and 1996, gross margin was consistent at 57.5% of
sales.
OPERATING EXPENSES. Total operating expenses increased to $2,814,000,
or 37.3% of sales for the second quarter 1997, from $2,423,000, or 37.5% of
sales for the comparable 1996 quarter. Total operating expenses increased to
$5,354,000, or 35.8% of sales for the first half of 1997, from $4,284,000, or
35.7% of sales for the six months ended June 30, 1996.
Selling and marketing expenses increased to $1,102,000, or 14.6% of
sales for the second quarter 1997, from $889,000, or 13.8% of sales for the same
quarter in 1996. Selling and marketing expenses increased to $2,010,000, or
13.4% of sales for the six months ended June 30, 1997, from $1,569,000, or 13.1%
of sales for the first half of 1996. The increase in sales and marketing
expenses for the second quarter 1997, compared to the first quarter, is
primarily due to increased spending on industry trade shows and the Company's
investment in marketing programs associated with new product introductions.
Research and development expenses were $972,000, or 12.9% of sales for
the second quarter of 1997, compared to $729,000, or 11.3% of sales for the
comparable 1996 quarter. Research and development expenses were $1,915,000, or
12.8% of sales for the six months ended June 30, 1997, compared to $1,322,000,
or 11.0% of sales for the six months ended June 30, 1996. Research and
development expenses consist primarily of employee salary and benefit costs,
cost of materials consumed in developing and designing new products and contract
product development. Certain engineering expenses associated with the
development of software are capitalized and amortized to cost of goods sold.
Much of the increased research and development expenses during the first half of
1997 is attributable to the hiring of engineers needed to accelerate development
of new products. In addition, part of this increase is attributable to the
development of a new ASIC required in the Company's new family of network
switching products.
General and administrative expenses were $740,000, or 9.8% of sales for
the second quarter 1997, compared to $805,000, or 12.5% of sales for the second
quarter 1996. General and administrative expenses were $1,429,000, or 9.5% of
sales for the six months ended June 30, 1997, compared to $1,393,000, or 11.6%
of sales for the first half of 1996. The increase in general and administrative
expenses of 2.6% for the first six months of this year as compared to 1996
reflects moderate growth of these expenses relative to sales growth.
INCOME TAXES. The provision for income taxes was $737,000 in the second
quarter of 1997, compared to $558,000 for the same quarter in 1996. The
effective corporate income tax rate for the second quarter of 1997 was 38.0%,
compared to 37.8% for the second quarter of 1996. For the six months ended June
30, 1997, the provision for income taxes amounted to $1,417,000, compared to
$1,086,000 for the first six months of 1996. The effective corporate income tax
rate was 38.0%, compared to 37.2% for the first six months of 1996.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1997, the Company's primary source of liquidity included
cash and cash equivalents of $6,312,000, marketable securities with a maturity
of less than one year of $11,100,000 and available borrowings of $3,000,000
under a revolving credit facility with a bank. No amounts were outstanding under
this credit facility as of June 30, 1997. The Company had working capital of
$23,223,000 at June 30, 1997, compared to $22,281,000 at March 31, 1997, and
$20,965,000 at December 31, 1996.
Cash provided by operating activities for the six months ended June
30, 1997 was $2,080,000, compared to $754,000 for the same period in 1996.
9
<PAGE>
Cash used in investing activities was $5,814,000 for the six months
ended June 30, 1997, compared to $862,000 for the six months ended June 30,
1996. During the six months ended June 30, 1997, investing activities included
the purchase of marketable securities of $4,998,000 and capital equipment
purchases of $416,000. Capital equipment purchases consist primarily of
manufacturing equipment, office equipment and computer and related equipment
used in engineering. In addition, the Company capitalized certain software
development costs amounting to $400,000 for the six months ended June 30, 1997,
compared to $196,000 for the same period in 1996. During the six months ended
June 30, 1996, cash payments of $93,000 were made to purchase the remaining
interest in its subsidiary, UCONx Corporation.
Cash provided by financing activities for the six months ended June 30,
1997 was $19,000 as compared to $11,371,000 of cash provided by financing
activities for the same period in 1996. During the first quarter of 1996, the
Company completed its initial public offering of Common Stock.
Assuming there is no significant change in the Company's business,
management believes that its current cash and marketable securities together
with cash generated from operations and available borrowings under the Company's
loan agreement will be sufficient to meet the Company's anticipated needs,
including working capital and capital expenditure requirements, for at least the
next twelve months. However, it is the Company's intention to continue
aggressive new product introductions for the remainder of 1997 and into 1998 for
a variety of markets served by the Company. Management has also initiated a
strategic acquisition program to further accelerate new product and market
penetration efforts. This program could have an impact on the Company's working
capital requirements, liquidity or capital resources.
10
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Part II. Other Information
Item 4. Submission of Matters to a Vote of Security Holders
The 1997 Annual Meeting of Stockholders was held on June 10, 1997. The
Directors elected at the meeting were as follows:
Votes Cast
Nominees For Abstain
-------- -------------------------
Donald L. Turrell 4,184,916 207,311
Paul L. Smith 4,185,686 206,541
The stockholders voted to ratify the appointment of Price Waterhouse
LLP as independent accountants for 1997. 4,380,864 shares of common stock were
voted in favor of the proposal, 3,300 shares of common stock voted against the
proposal and 8,063 shares of common stock abstained.
The stockholders also voted to approve an amendment to the Performance
Technologies, Incorporated Stock Option Plan increasing the number of shares of
the Company's common stock reserved for issuance under the Option Plan to
1,200,000. 2,842,310 shares of common stock voted in favor of the proposal,
525,970 shares of common stock voted against the proposal and 145,705 shares of
common stock abstained.
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 11 - Computation of earnings per share.
B. Reports on Form 8-K
There were no reports on Form 8-K filed during the
three month period ended June 30, 1997.
11
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Exhibit 11 - Computation of Earnings Per Share
For the Three and Six Months Ending June 30, 1997 and 1996
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
---------- --------- ---------- ----------
Weighted average common and common share equivalents:
Weighted average common shares
outstanding during the period 4,814,000 4,774,000 4,809,000 4,553,000
Weighted average common share equivalents 125,000 194,000 119,000 168,000
---------- --------- ---------- ----------
4,939,000 4,968,000 4,928,000 4,721,000
========== ========== ========== ==========
Net Income $1,200,000 $ 910,000 $2,312,000 $1,807,000
========== ========= ========== ==========
Earnings per share $ .24 $ .18 $ .47 .38
========== ========= ========== ==========
Pro forma weighted average common and common share equivalents:
Pro forma weighted average common shares
outstanding during the period 7,225,000 7,185,000 7,220,000 7,133,000
Pro forma weighted average
common share equivalents 187,000 292,000 179,000 252,000
---------- ---------- ---------- ----------
7,412,000 7,477,000 7,399,000 7,385,000
========== ========= ========== ==========
Net Income $1,200,000 $ 910,000 $2,312,000 $1,807,000
========== ========= ========== ==========
Pro forma earnings per share $ .16 $ .12 $ .31 $ .24
========== ========= ========== ==========
</TABLE>
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PERFORMANCE TECHNOLOGIES, INCORPORATED
August 13, 1997 By: s/ Donald L. Turrell
------------------------
Donald L. Turrell
President and
Chief Executive Officer
August 13, 1997 By: s/ Dorrance W. Lamb
-----------------------
Dorrance W. Lamb
Chief Financial Officer and
Vice President, Finance
<TABLE> <S> <C>
<S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE JUNE 30, 1997 FINANCIAL STATEMENTS OF PERFORMANCE
TECHNOLOGIES, INC. AND SUBSIDIARIES AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001003950
<NAME> PERFORMANCE TECHNOLOGIES, INC.
<MULTIPLIER> 1,000
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-START> Jan-01-1997
<PERIOD-END> Jun-30-1997
<EXCHANGE-RATE> 1
<CASH> 6,312
<SECURITIES> 11,100
<RECEIVABLES> 3,643
<ALLOWANCES> 0
<INVENTORY> 4,297
<CURRENT-ASSETS> 26,189
<PP&E> 3,721
<DEPRECIATION> 2,580
<TOTAL-ASSETS> 28,267
<CURRENT-LIABILITIES> 2,966
<BONDS> 24
0
0
<COMMON> 49
<OTHER-SE> 25,009
<TOTAL-LIABILITY-AND-EQUITY> 28,267
<SALES> 14,973
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<CHANGES> 0
<NET-INCOME> 2,312
<EPS-PRIMARY> 0.47
<EPS-DILUTED> 0.47
</TABLE>
