- --------------------------------------------------------------------------------
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 September 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 7,261,825
as of November 5, 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 September 30, 1997
(unaudited) and December 31, 1996 3
Consolidated Statements of Income For The Three and Nine
Months Ended September 30, 1997 and 1996 (unaudited) 4
Consolidated Statements of Cash Flows For The Nine
Months Ended September 30, 1997 and 1996 (unaudited) 5
Notes to Consolidated Financial Statements For The Nine
Months Ended September 30, 1997 (unaudited) 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7
Part II. Other Information
Item 2. Changes in Securities and Use of Proceeds 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>
September 30, December 31,
1997 1996
(unaudited)
------------- -------------
Current assets:
Cash and cash equivalents $ 6,638,000 $ 10,027,000
Marketable securities 12,614,000 6,102,000
Accounts receivable, net 4,847,000 3,234,000
Inventories, net - Note C 3,470,000 4,032,000
Prepaid expenses and other 536,000 284,000
Deferred taxes 419,000 419,000
------------- -------------
Total current assets 28,524,000 24,098,000
Equipment and improvements, net 1,062,000 1,267,000
Software development, net 668,000 549,000
Other assets 134,000 175,000
------------- -------------
Total assets $ 30,388,000 $ 26,089,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $ 12,000 $ 26,000
Accounts payable 1,173,000 953,000
Income taxes payable 327,000 23,000
Accrued expenses 2,150,000 2,131,000
------------- -------------
Total current liabilities 3,662,000 3,133,000
Long term debt, less current portion 21,000 30,000
Deferred taxes 219,000 219,000
------------- -------------
Total liabilities 3,902,000 3,382,000
------------- -------------
Stockholders' equity
Preferred stock
Common stock - Note B 73,000 49,000
Additional paid-in capital - Note B 12,927,000 12,885,000
Retained earnings 13,644,000 9,930,000
Treasury stock (158,000) (157,000)
------------- -------------
Total stockholders' equity 26,486,000 22,707,000
------------- -------------
Total liabilities and stockholders' equity $ 30,388,000 $ 26,089,000
============= =============
</TABLE>
3
<PAGE>
PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
------------ ------------ ------------ ------------
Sales $ 7,606,000 $ 6,412,000 $ 22,579,000 $ 18,412,000
Cost of goods sold 3,263,000 2,906,000 9,620,000 8,011,000
------------ ------------ ------------ ------------
Gross profit 4,343,000 3,506,000 12,959,000 10,401,000
------------ ------------ ------------ ------------
Operating expenses:
Selling and marketing 1,004,000 732,000 3,015,000 2,300,000
Research and development 791,000 801,000 2,705,000 2,124,000
General and administrative 552,000 719,000 1,980,000 2,112,000
------------ ------------ ------------ ------------
Total operating expenses 2,347,000 2,252,000 7,700,000 6,536,000
------------ ------------ ------------ ------------
Income from operations 1,996,000 1,254,000 5,259,000 3,865,000
Other income, net 266,000 202,000 733,000 509,000
------------ ------------ ------------ ------------
Income before taxes and minority interest 2,262,000 1,456,000 5,992,000 4,374,000
Provision for income taxes 860,000 544,000 2,278,000 1,631,000
------------ ------------ ------------ ------------
Income before minority interest 1,402,000 912,000 3,714,000 2,743,000
Minority interest (24,000)
------------ ------------ ------------ ------------
Net income $ 1,402,000 $ 912,000 $ 3,714,000 $ 2,719,000
============ ============ ============ ============
Earnings per share - Note B $ .18 $ .12 $ .50 $ .37
=========== =========== =========== ===========
Weighted average common and common
equivalent shares - Note B 7,625,000 7,417,000 7,418,000 7,375,000
=========== =========== =========== ===========
</TABLE>
4
<PAGE>
PERFORMANCE TECHNOLOGIES, INCORPORATED AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
Nine Months Ended
September 30,
1997 1996
------------- ------------
Cash flows from operating activities
Net income $ 3,714,000 $ 2,719,000
Non-cash adjustments:
Depreciation and amortization 1,119,000 589,000
Other 168,000 466,000
Changes in operating assets and liabilities:
Accounts receivable (1,628,000) (1,032,000)
Inventories 409,000 (1,190,000)
Prepaid expenses and other (251,000) 92,000
Accounts payable 220,000 23,000
Accrued expenses 19,000 682,000
Income taxes payable 304,000 412,000
------------- ------------
Net cash provided by operating activities 4,074,000 2,761,000
------------- ------------
Cash flows from investing activities
Cash purchases of equipment and improvements, net (456,000) (674,000)
Capitalized software development (537,000) (232,000)
Purchase of marketable securities (6,512,000)
Purchase of remaining shares in subsidiary (93,000)
------------- ------------
Net cash used in investing activities (7,505,000) (999,000)
------------- ------------
Cash flows from financing activities
Payments on capital lease obligations (15,000) (46,000)
Repayment of notes payable (8,000) (23,000)
Proceeds from issuance of common stock 65,000 11,453,000
------------- ------------
Net cash provided by financing activities 42,000 11,384,000
------------- ------------
Net (decrease) increase in cash (3,389,000) 13,146,000
Cash and cash equivalents at beginning of period 10,027,000 2,466,000
------------- ------------
Cash and cash equivalents at end of period $ 6,638,000 $ 15,612,000
============= ============
</TABLE>
5
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Notes to Consolidated Financial Statements
For The Nine Months Ended September 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 A three-for-two stock split on the Company's Common stock was effected
in the form of a stock dividend on September 15, 1997. Common stock and
Additional paid-in capital as of September 30, 1997 and all share and per share
data have been restated to reflect this split.
There were 7,244,710 and 4,801,301 shares (pre-split) issued
and outstanding (net of treasury shares held) at September 30, 1997 and December
31, 1996, respectively, of the Company's $.01 par value Common Stock. During the
nine months ended September 30, 1997, 28,514 common shares (pre-split) were
issued upon the exercise of stock options.
Note - C Inventories consisted of the following at September 30, 1997
and December 31, 1996:
<TABLE>
<CAPTION>
<S> <C> <C>
September 30, December 31,
1997 1996
(unaudited)
Purchased parts and components ...... $ 1,134,000 $ 1,601,000
Work in process ..................... 2,551,000 2,641,000
Finished goods ...................... 284,000 292,000
----------- -----------
3,969,000 4,534,000
Less: reserve for inventory obsolescence (499,000) (502,000)
----------- -----------
Net ............................... $ 3,470,000 $ 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 for the third quarter and
nine months ended September 30, 1997, respectively, and $.01 for each the third
quarter and nine months ended September 30, 1996, respectively.
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 third quarter and for
the nine months ended September 30, 1997. Net income for the third quarter 1997
increased by 54% to $1,402,000 and net income for the nine months ended
September 30, 1997 increased 37% to $3,714,000 as compared to the respective
1996 periods. At September 30, 1997, the Company had approximately $19.3 million
in cash and marketable securities, no significant debt and generated income from
operations excluding depreciation and amortization (EBITDA) for the nine months
ended September 30, 1997 of approximately $6.4 million as compared to
approximately $4.5 million for the same period in 1996.
On September 15, 1997, the Company effected a three-for-two stock split in the
form of a 50% stock dividend which increased the number of shares outstanding to
7.2 million shares. Management believes that increasing the number of shares
available in the financial market will benefit the Company's stockholders and is
part of an active program to broaden the Company's stockholder base. By the end
of the third quarter, the Company's market capitalization had exceeded $100
million. Management believes this is significant to the investment community and
ultimately to its stockholders as many institutional investors are unwilling to
invest in companies with a market capitalization of less than $100 million.
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, Solaris(TM), SunOS(TM), Windows NT(TM), VxWorks and
LINUX. During the third quarter of 1997, the Company has introduced PCI-based
LAN, WAN and Mass Storage products that support the new PCI-based Ultra 30
workstations introduced by Sun Microsystems, Inc.; Mass Storage Ultra SCSI
Adapters and three new fast Ethernet network switch products. These new switch
products have not only expanded the Nebula(TM) product line with the next
generation of fast Ethernet products but also incorporate features for high
reliability and fault tolerance. These products were launched in early October
at the Networld+InterOp trade show in Atlanta and are designed specifically for
business and mission critical environments. Beta units of these new switching
products are expected to be shipped by year-end with production units shipping
in March or April of next year.
7
<PAGE>
In September, the Company's Controller Products Group presented its new PCIbus
WAN and LAN communications and mass storage products at the IT Forum in New York
City. In addition, in mid-October the Company announced three new products for
the new emerging Compact PCI market. These products are a WAN Communications
Controller, T1/E1 Primary Rate WAN Communication Controller, and WAN Protocol
Engine. Availability of these products is scheduled for December 1997 and
January 1998.
The Company has recently been featured in a number of publications including an
article in the Investor's Business Daily on September 10th titled "Finding
Growth in Ultra-High-Tech Markets". For the second consecutive year, Performance
Technologies was recognized on the Forbes Magazine list of the "Best 200 Small
Companies in America."
Quarter and Nine Months Ended September 30, 1997, compared with
the Quarter and Nine Months Ended September 30, 1996
SALES. Sales for the third quarter of 1997 increased by $1,194,000
(18.6%) to $7,606,000, from $6,412,000 for the third quarter of 1996. Sales for
the nine months ended September 30, 1997 increased by $4,167,000 (22.6%) to
$22,579,000, from $18,412,000 for the nine months ended September 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 47% of sales during the third
quarter of 1997, compared to 41% for the same period in 1996. Shipments were 47%
of sales for the nine months ended September 30, 1997 and were 43% of sales for
the comparable 1996 period. Sales of WAN products increased 35% for the third
quarter and 33% year-to-date in 1997, over the respective 1996 periods. This
increase is attributable to introductions over the last twelve to eighteen
months of several new WAN products and several new OEM customers integrating
these products into their product applications.
Shipments of LAN Adapter products for the third quarter of 1997 amounted to 15%
of sales, compared to 18% for the third quarter of 1996, and were 17% of sales
for the nine months ended September 30, 1997, compared to 22% for the first nine
months of 1996. The largest share of the Company's LAN business is generated
from Commercial Off-the-Shelf (COTS) Defense applications. This project-oriented
business is difficult to predict on a quarterly basis. Management expects the
dollar volume of this business to meet or slightly exceed last year's level of
sales.
Shipments of Network Systems products represented 11% of total sales in the
third quarter of 1997 and 15% for same period in 1996. Network Systems shipments
were 11% of total sales for each of the nine months ended September 30, 1997 and
1996. For the third quarter of 1997, revenues from Network Systems products
increased from the second quarter level because a component design change was
successfully resolved. However, the Radar protocol software business in the
Company's UCONx subsidiary was less than forecast. The Radar protocol business
is typically project-oriented and can fluctuate from quarter to quarter.
Shipments of Mass Storage Interface products for the third quarter of 1997
amounted to 14% of sales, compared to 16% in the third quarter of 1996. For the
nine months ended September 30, 1997, Mass Storage products were 16% of total
sales compared to 15% for the same 1996 period. Sales of Mass Storage Interface
products increased 26% for the nine months ended September 30, 1997 over the
respective 1996 period. The increase in sales volume is primarily attributable
to the Company's Ultra SCSI interface product introduced in mid 1996.
Shipments of Inter-system Connectivity products represented 13% of sales for the
third quarter of 1997 and 9% of total sales for the nine months ended September
30, 1997, compared to 10% and 9%, respectively for the 1996 periods. The Company
is not investing in this group of products and a decline in these revenues is
expected from last year's levels.
International sales amounted to 10% of total sales for the first nine months
of 1997, compared to 11% of sales for all of 1996.
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 57.1% of sales for the third
quarter, from 54.7% in the third quarter of 1996. For the first nine months of
1997 gross margin improved to 57.4% of sales as compared to 56.5% for the same
period in 1996. The improved margin is primarily attributable to the mix of
product shipments for the quarter and manufacturing and purchasing efficiencies
attributable to higher volumes.
OPERATING EXPENSES. Total operating expenses increased to $2,347,000,
or 30.9% of sales for the third quarter 1997, from $2,252,000, or 35.1% of sales
for the comparable 1996 quarter. Total operating expenses increased to
$7,700,000, or 34.1% of sales for the first nine months of 1997, from
$6,536,000, or 35.5% of sales for the nine months ended September 30, 1996.
Selling and marketing expenses increased to $1,004,000, or 13.2% of sales for
the third quarter 1997, from $732,000, or 11.4% of sales for the same quarter in
1996. Selling and marketing expenses increased to $3,015,000, or 13.4% of sales
for the nine months ended September 30, 1997, from $2,300,000, or 12.5% of sales
for the first nine months of 1996. Beginning in late 1996, the Company increased
spending in its marketing program for industry trade shows, etc. in order to
promote its new product introductions.
Research and development expenses were $791,000, or 10.4% of sales for the third
quarter of 1997, compared to $801,000, or 12.5% of sales for the comparable 1996
quarter. Research and development expenses were $2,705,000, or 12.0% of sales
for the nine months ended September 30, 1997, compared to $2,124,000, or 11.5%
of sales for the nine months ended September 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. The net benefit
derived from the capitalization of certain software development costs, less
applicable amortization, amounted to $119,000 for the nine months ended
September 30, 1997, compared to $38,000 for the nine months ended September 30,
1996. The increase of research and development expenses for the nine months
ended September 30, 1997 compared to the same period in 1996 is attributable to
hiring engineers needed to accelerate the development of new products and the
development of a new network ASIC developed in connection with the new switch
products. As expected, research and development expenses declined in the third
quarter 1997 from the second quarter, because development on certain new
products was completed early in the third quarter.
General and administrative expenses were $552,000, or 7.3% of sales for the
third quarter 1997, compared to $719,000, or 11.2% of sales for the third
quarter 1996. General and administrative expenses were $1,980,000, or 8.8% of
sales for the nine months ended September 30, 1997, compared to $2,112,000, or
11.5% of sales for the first nine months of 1996. The decrease in general and
administrative expenses for the third quarter 1997, compared to 1996 is
primarily attributable to the Company recognizing a benefit of approximately
$130,000 as a result of a state sales tax audit.
INCOME TAXES. The provision for income taxes was $860,000 in the third
quarter of 1997, compared to $544,000 for the same quarter in 1996. The
effective corporate income tax rate for the third quarter of 1997 was 38.0%,
compared to 37.4% for the third quarter of 1996. For the nine months ended
September 30, 1997, the provision for income taxes amounted to $2,278,000,
compared to $1,631,000 for the first nine months of 1996. The effective
corporate income tax rate was 38.0%, compared to 37.3% for the first nine months
of 1996.
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1997, the Company's primary source of liquidity included cash
and cash equivalents of $6,638,000, marketable securities with a maturity of
less than one year of $12,614,000 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 September 30, 1997. The Company had working capital of
$24,862,000 at September 30, 1997, as compared to $23,223,000 at June 30, 1997
and $20,965,000 at December 31, 1996.
9
<PAGE>
Cash provided by operating activities for the nine months ended September 30,
1997 was $4,074,000, compared to $2,761,000 for the same period in 1996. Cash
used in investing activities was $7,505,000 for the nine months ended September
30, 1997, compared to $999,000 for the nine months ended September 30, 1996.
During the nine months ended September 30, 1997, investing activities included
the purchase of marketable securities of $6,512,000 and capital equipment
purchases of $456,000. Capital equipment purchases consist primarily of
manufacturing equipment, office equipment and computer and related equipment
used in engineering . During the nine months ended September 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 nine months ended September 30,
1997 was $42,000 as compared to $11,384,000 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.
Many companies are facing a potential issue regarding the ability of information
systems to accommodate the coming year 2000. The Company is evaluating its
information systems and believes that all critical systems can, or will be able
to accommodate the coming century without material adverse effect on the
Company's financial condition, results of operations, capital spending or
competitive position.
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 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 2. Changes in Securities and Use of Proceeds
The following table summarizes the proceeds from the sale of securities and use
of proceeds therefrom in connection with the Registrant's Initial Public
Offering on January 24, 1996. Amounts reported represent an estimate of the
amount of these expenditures.
<TABLE>
<CAPTION>
<S> <C>
Proceeds from the sale of securities:
Gross proceeds ........................................... $12,800,000
Less: Underwriter's commission 896,000
Finder's fees ................................... 0
Underwriter's expenses .......................... 27,000
Payments to Directors, Officers, General Partners 0
Other ........................................... 461,000
-----------
Net proceeds ............................................. $11,416,000
===========
Use of Proceeds:
Construction of facilities ............................... $ 0
Purchase of machinery .................................... 1,563,000
Purchase of real estate .................................. 0
Acquisition of other business(es) ........................ 0
Repayment of debt ........................................ 0
General working capital purposes ......................... 0
Temporary investments .................................... 3,471,000
Inventory for new products ............................... 1,265,000
Software development ..................................... 917,000
Product development ...................................... 4,200,000
-----------
Total use of proceeds .................................... $11,416,000
===========
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 11 - Computation of earnings per share.
B. Reports on Form 8-K
Report on Form 8-K dated July 30, 1997 was filed
during the three month period ended September 30, 1997. Item 5 - Other items;
reported the declaration of the three-for-two stock split in the form of a stock
dividend and distribution on shares of the Registrant's Common Stock.
11
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Exhibit 11 - Computation of Earnings Per Share
For the Three and Nine Months Ending September 30, 1997 and 1996
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1996 1997 1996
---------- ---------- ---------- ----------
Weighted average common and common
share equivalents (1):
Weighted average common shares
outstanding during the period . 7,238,000 7,182,000 7,170,000 7,128,000
Weighted average common share equivalents .. 387,000 235,000 248,000 247,000
---------- ---------- ---------- ----------
7,625,000 7,417,000 7,418,000 7,375,000
========== ========== ========== ==========
Net Income ... .......................... $1,402,000 $ 912,000 $3,714,000 $2,719,000
========== ========== ========== ==========
Earnings per share (1) ............ $ .18 $ .12 $ .50 $ .37
========== ========== ========== ==========
(1) All share and per share data have been restated to reflect a three-for-two
stock split effected on September 15, 1997.
</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
November 14, 1997 By: s/ Donald L. Turrell
------------------------
Donald L. Turrell
President and
Chief Executive Officer
November 14, 1997 By: s/ Dorrance W. Lamb
-----------------------
Dorrance W. Lamb
Chief Financial Officer and
Vice President, Finance
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE SEPTEMBER 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> 9-mos
<FISCAL-YEAR-END> Dec-31-1997
<PERIOD-START> Jan-01-1997
<PERIOD-END> Sep-30-1997
<EXCHANGE-RATE> 1
<CASH> 6,638
<SECURITIES> 12,614
<RECEIVABLES> 4,847
<ALLOWANCES> 0
<INVENTORY> 3,470
<CURRENT-ASSETS> 28,524
<PP&E> 3,745
<DEPRECIATION> 2,683
<TOTAL-ASSETS> 30,388
<CURRENT-LIABILITIES> 3,662
<BONDS> 21
0
0
<COMMON> 73
<OTHER-SE> 26,413
<TOTAL-LIABILITY-AND-EQUITY> 30,388
<SALES> 22,579
<TOTAL-REVENUES> 22,579
<CGS> 9,620
<TOTAL-COSTS> 7,700
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 5,992
<INCOME-TAX> 2,278
<INCOME-CONTINUING> 3,714
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 3,714
<EPS-PRIMARY> 0.5
<EPS-DILUTED> 0.5
</TABLE>
