UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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 quarterly period ended September 24, 1995, or
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period ended ______________ or ______________
Commission File Number 0-15323
NETWORK EQUIPMENT TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
Delaware 94-2904044
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification Number)
organization)
800 Saginaw Drive
Redwood City, CA 94063
(415) 366-4400
(Address, including zip code, and telephone number
including area code, of registrant's
principal executive offices)
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,
$.01 par value, on September 24, 1995 was 19,660,650.
This document consists of 13 pages of which this is page 1.
<Page 2>
NETWORK EQUIPMENT TECHNOLOGIES, INC.
INDEX
Page
Number
------
PART I. Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheet -
September 24, 1995 and March 31, 1995 ....................... 3
Condensed Consolidated Statement of Income -quarter and
six months ended September 24, 1995 and September 25, 1994... 4
Condensed Consolidated Statement of Cash Flows -six months
ended September 24, 1995 and September 25, 1994 ............. 5
Notes to Condensed Consolidated Financial Statements ........ 6
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition ........... 7
PART II. Other Information
Item 4. Submission of Matters to a Vote of Security Holders ..... 11
Item 5. Other Information ....................................... 11
Item 6. Exhibits and Reports on Form 8-K ........................ 11
SIGNATURE .......................................................... 12
EXHIBIT 11 Computation of Primary and Fully Diluted
Earnings Per Share ..................................... 13
<Page 3>
NETWORK EQUIPMENT TECHNOLOGIES, INC.
Condensed Consolidated Balance Sheet
(dollars in thousands)
<TABLE>
<CAPTION>
September 24, March 31,
1995 1995
(unaudited)
--------- ---------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents $ 33,301 $ 33,886
Temporary cash investments 69,798 52,734
Accounts receivable, net of allowances of $3,582 at
September 24 and $2,514 at March 31 69,163 56,983
Inventories 30,096 32,314
Deferred income taxes 9,900 9,900
Prepaid expenses and other assets 6,329 4,625
-------- --------
Total current assets 218,587 190,442
Property and equipment, net of accumulated depreciation and
amortization of $95,124 at September 24 and $90,618 at March 31 26,351 27,149
Software production costs, net of accumulated amortization of
$22,206 at September 24 and $20,838 at March 31 3,930 4,691
Other assets 9,159 9,764
-------- --------
$258,027 $232,046
-------- --------
-------- --------
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 19,622 $ 18,315
Accrued liabilities 46,326 43,444
-------- --------
Total current liabilities 65,948 61,759
7-1/4% convertible subordinated debentures 68,625 68,625
Stockholders' equity:
Preferred stock, $.01 par value
Authorized: 5,000,000 shares,
Outstanding: none - -
Common stock to be issued - 32
Common stock, $.01 par value
Authorized: 50,000,000 shares
Outstanding: 19,661,000 shares at September 24 and
18,714,000 shares at March 31 197 187
Additional paid-in capital 121,880 113,846
Unrealized gain (loss) on available-for-sale securities 56 (10)
Accumulated translation adjustment (950) (794)
Retained earnings (deficit) 2,271 (11,599)
-------- --------
Total stockholders' equity 123,454 101,662
-------- --------
$258,027 $232,046
-------- --------
-------- --------
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
<Page 4>
NETWORK EQUIPMENT TECHNOLOGIES, INC.
Condensed Consolidated Statement of Income
(in thousands, except per share amounts - unaudited)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
Sept. 24, Sept. 25, Sept. 24, Sept. 25,
1995 1994 1995 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Revenue:
Product revenue $ 53,483 $ 44,030 $102,981 $ 84,660
Service and other revenue 29,475 22,821 59,586 43,729
-------- -------- -------- --------
Total revenue 82,958 66,851 162,567 128,389
-------- -------- -------- --------
Cost of sales:
Cost of product revenue 21,449 18,117 41,310 35,200
Cost of service and other revenue 19,943 16,330 40,969 30,704
-------- -------- -------- --------
Total cost of sales 41,392 34,447 82,279 65,904
-------- -------- -------- --------
Gross margin 41,566 32,404 80,288 62,485
Operating expenses:
Sales and marketing 18,379 17,113 36,108 34,017
Research and development 8,767 8,439 16,867 16,544
General and administrative 3,101 2,821 6,040 5,346
-------- -------- -------- --------
Total operating expenses 30,247 28,373 59,015 55,907
Income from operations 11,319 4,031 21,273 6,578
Other income (expense):
Interest income 1,455 476 2,820 770
Interest expense (1,365) (1,306) (2,657) (2,602)
Other 49 (282) (98) (400)
-------- -------- -------- --------
Income before income taxes 11,458 2,919 21,338 4,346
Income tax provision 4,010 - 7,468 -
-------- -------- -------- --------
Net income $ 7,448 $ 2,919 $ 13,870 $ 4,346
-------- -------- -------- --------
-------- -------- -------- --------
Net income per share:
Primary $ .36 $ .16 $ .68 $ .25
-------- -------- -------- --------
-------- -------- -------- --------
Fully diluted $ .36 $ .16 $ .68 $ .23
-------- -------- -------- --------
-------- -------- -------- --------
Shares used in computation:
Primary 20,578 18,243 20,281 17,988
-------- -------- -------- --------
-------- -------- -------- --------
Fully diluted 20,693 18,725 20,532 18,608
-------- -------- -------- --------
-------- -------- -------- --------
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
<Page 5>
NETWORK EQUIPMENT TECHNOLOGIES, INC.
Condensed Consolidated Statement of Cash Flows
(in thousands - unaudited)
<TABLE>
<CAPTION>
Six Months Ended
Sept. 24, Sept. 25,
1995 1994
-------- --------
<S> <C> <C>
Cash and Cash Equivalents at Beginning of Period $33,886 $23,854
Net Cash Flows from Operating Activities:
Net income 13,870 4,346
Adjustments to reconcile net income to cash
provided by operations:
Depreciation and amortization 7,814 9,072
Restricted stock compensation 170 -
Changes in assets and liabilities:
Accounts receivable (12,590) 6,354
Inventories 2,164 3,815
Prepaid expenses and other assets (1,758) (166)
Accounts payable 1,358 (6,323)
Accrued liabilities 2,980 (5,063)
------- -------
Net cash provided by operations 14,008 12,035
------- -------
Cash Flows from Investing Activities:
Purchases of temporary cash investments (53,322) (18,352)
Proceeds from maturities of temporary cash investments 36,324 9,602
Additions to property and equipment (5,741) (2,849)
Additions to software production costs (607) (1,371)
Other 548 299
------- -------
Net cash used for investing activities (22,798) (12,671)
------- -------
Cash Flows from Financing Activities:
Sale of common stock 7,842 3,814
Repayments of borrowings - (12)
------- -------
Net cash provided by financing activities 7,842 3,802
------- -------
Effect of exchange rate changes on cash 363 (902)
------- -------
Net increase (decrease) in cash and cash equivalents (585) 2,264
------- -------
Cash and Cash Equivalents at End of Period $33,301 $26,118
------- -------
------- -------
Other Cash Flow Information:
Cash paid for:
Interest $ 2,577 $ 2,552
Income taxes $ 2,572 $ 421
Non-cash investing and financing activities:
Net unrealized (gain) loss on available-for-sale securities $ (66) $ 44
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
<Page 6>
NETWORK EQUIPMENT TECHNOLOGIES, INC.
Notes to Condensed Consolidated Financial Statements
1. Basis of Presentation
The consolidated financial statements include the accounts of the Company
and its subsidiaries. Intercompany accounts and transactions have been
eliminated.
In the opinion of management, the accompanying unaudited condensed
consolidated financial statements contain all adjustments (consisting
only of normal recurring adjustments) necessary to present fairly the
financial position as of September 24, 1995, and the results of
operations and cash flows for the quarter and six months ended September
24, 1995 and September 25, 1994. These statements should be read in
conjunction with the March 31, 1995 consolidated financial statements and
notes thereto. The results of operations for the six months ended
September 24, 1995 are not necessarily indicative of the results to be
expected for the fiscal year ending March 31, 1996.
2. Reclassification
Certain fiscal 1995 amounts have been reclassified to conform with fiscal
1996 presentation.
3. Inventories
Inventories consist of (in thousands):
September 25, March 31,
1995 1995
(unaudited)
-------- --------
Purchased components $ 11,840 $ 11,498
Work-in-process 15,949 17,175
Finished goods 2,307 3,641
-------- --------
$ 30,096 $ 32,314
-------- --------
-------- --------
4. Earnings Per Share
Net income per share has been computed based upon the weighted average
number of common and common equivalent shares outstanding. For primary
earnings per share, common equivalent shares consist of the incremental
shares issuable upon the assumed exercise of dilutive stock options. For
fully diluted earnings per share, common equivalent shares also include,
if dilutive, the effect of incremental shares issuable upon the
conversion of the 7-1/4% convertible subordinated debentures, and net
income will be adjusted for the interest expense (net of income taxes)
related to the debentures.
<Page 7>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
This discussion and analysis should be read in conjunction with Management's
Discussion and Analysis in the Company's 1995 Annual Report to Shareholders
and Part I of the Company's Form 10-K for the fiscal year ended March 31,
1995.
RESULTS OF OPERATIONS
The following table depicts selected data derived from the consolidated
statement of operations expressed as a percentage of revenue for the periods
presented:
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
Sept. 24, Sept. 25, Sept. 24, Sept. 25,
Percent of Revenue 1995 1994 1995 1994
------- ------- ------- -------
<S> <C> <C> <C> <C>
Product revenue 64.5 65.9 63.3 65.9
Service and other revenue 35.5 34.1 36.7 34.1
----- ----- ----- -----
Total revenue 100.0 100.0 100.0 100.0
----- ----- ----- -----
Product revenue gross margin 59.9 58.9 59.9 58.4
Service and other revenue gross margin 32.3 28.4 31.2 29.8
----- ----- ----- -----
Total gross margin 50.1 48.5 49.4 48.7
----- ----- ----- -----
Sales and marketing 22.2 25.6 22.2 26.5
Research and development 10.6 12.7 10.4 12.9
General and administrative 3.7 4.2 3.7 4.2
----- ----- ----- -----
Total operating expenses 36.5 42.5 36.3 43.6
----- ----- ----- -----
Income from operations 13.6 6.0 13.1 5.1
----- ----- ----- -----
Net income 9.0 4.4 8.5 3.4
----- ----- ----- -----
----- ----- ----- -----
</TABLE>
Revenue
Total revenue for the second quarter and first six months of fiscal 1996
increased 24.1% and 26.6%, respectively, from the comparable periods of fiscal
1995. Product revenue for the second quarter and first six months of fiscal
1996 increased $9.5 million, or 21.5%, and $18.3 million, or 21.6%,
respectively, from the comparable periods of the prior year. The quarter-
over-quarter increase in product revenue is a result of an increase in sales
across all sales channels, most significantly in international sales in
Europe. An increase in international sales, as well as an increase in sales
to network service providers, are the primary drivers for the year-to-date
increase in product revenue as well. International product sales increased
19.8% to 37.6% of product revenue for the quarter and 24.4% to 35.0% of
product revenue year-to-date.
Service and other revenue for the second quarter and first six months of
fiscal 1996 increased $6.7 million and $15.9 million, respectively. This
increase is primarily attributable to systems integration services in support
of product sales to the U.S. government. On a year-to-date basis, systems
integration revenue increased by $11.1 million over the prior year.
<Page 8>
Gross Margin
Total gross margin as a percentage of total revenue increased to 50.1% and
49.4% in the second quarter and first six months of fiscal 1996 from 48.5% and
48.7%, respectively, in the comparable periods of fiscal 1995. These
increases are a result of increases in both product and service and other
gross margins. Product gross margin increased to 59.9% for both the second
quarter and first six months of fiscal 1996 from 58.9% and 58.4%,
respectively, for the comparable periods of fiscal 1995. These increases
resulted primarily from a favorable product mix and a higher revenue base over
which to spread manufacturing costs.
Service and other gross margin increased to 32.3% and 31.2% for the second
quarter and first six months of fiscal 1996 from 28.4% and 29.8%,
respectively, in the comparable periods of the prior year. These margins
increased despite a significantly higher mix of lower margin systems
integration services provided under a U.S. government contract. The increase
is attributable to an increase in gross margin on these services to 16.0% and
13.8% for the second quarter and first six months of fiscal 1996 from 10.5%
and 10.8%, respectively, for the comparable periods of fiscal 1995 as well as
increased service margins. Management expects service and other gross margin
to continue to fluctuate as a result of the changes in mix between systems
integration services and other service revenue.
Operating Expenses
Operating expenses in the second quarter and first six months of fiscal 1996
increased $1.9 million and $3.1 million from the comparable periods of fiscal
1995, but decreased as a percentage of total revenue to 36.5% and 36.3% from
42.5% and 43.6%, respectively, as a result of higher revenue levels.
Management expects the relationship of operating expenses as a percentage of
total revenue to continue to trend downward during the remainder of fiscal
1996 as planned revenue growth exceeds that of operating expenses.
Sales and marketing expense in the second quarter and first six months of
fiscal 1996 increased $1.3 million and $2.1 million, respectively, from the
comparable periods of fiscal 1995, but decreased as a percentage of total
revenue to 22.2% for both periods from 25.6% and 26.5%, respectively. The
increase in spending is primarily the result of the addition of personnel to
support expansion of the sales infrastructure. Management expects sales and
marketing expenses to increase during the remainder of fiscal 1996 while
decreasing as a percentage of planned revenue.
Research and development expense increased slightly in the second quarter and
first six months of fiscal 1996 from the comparable periods of fiscal 1995,
but decreased as a percentage of total revenue to 10.6% and 10.4%,
respectively, from 12.7% and 12.9% in the comparable periods of fiscal 1995.
Management plans to continue funding research and development efforts at
levels necessary to advance product programs. While it is management's
intention to continue to focus these development efforts, research and
development spending is expected to increase during the remainder of fiscal
1996 while remaining relatively constant as a percentage of planned revenue.
General and administrative expense increased $.3 million and $.7 million in
the second quarter and first six months of fiscal 1996 as compared to the
prior year, but decreased as a percentage of total revenue, to 3.7% from 4.2%,
respectively, for both quarter and year-to-date periods
Other Income (Expense)
Interest income for the first six months of fiscal 1996 increased $2.1 million
from the comparable period of fiscal 1995 due to higher cash balances and
higher interest rates. Interest expense, primarily related to the 7-1/4%
convertible subordinated debentures, remained flat at approximately $2.6
million.
<Page 9>
Income Taxes
The second quarter and first six months of fiscal 1996 include a provision for
income tax expense of $4.0 million and $7.5 million, respectively, at an
effective rate of 35%. No tax expense was recorded in the comparable periods
of fiscal 1995 due to the utilization of net operating loss carryforwards.
BUSINESS ENVIRONMENT AND RISK FACTORS
Historically, the majority of the Company's revenues in each quarter results
from orders received and shipped in that quarter. Because of these ordering
patterns and potential delivery schedule changes, the Company does not believe
that backlog is indicative of future revenue levels. Furthermore, if large
orders do not close when forecasted or if near term demand for the Company's
products weakens, the Company's operating results for that or subsequent
quarters would be adversely affected.
Expense levels are relatively fixed and are set based on expectations
regarding future revenue and margin levels. These expectations involve making
judgments on issues such as future competitive conditions and customer
requirements, a process that involves evaluation of information that is often
unclear and in conflict. All markets for the Company's products are very
competitive and dynamic. The Company has limited visibility into factors that
could influence its revenue and margins, particularly in international markets
that are served primarily by non-exclusive resellers. Moreover, the Company
believes that future operating results will depend on successful development
or introduction of new products and enhancements to existing products and
service offerings, and there can be no guarantee that the Company will succeed
in such efforts.
The Company's products include components, assemblies and subassemblies that
are currently available from single sources. Testing and manufacturing is
performed at the Company's Redwood City, California facility. Availability
limitations, price increases or business interruptions could adversely impact
revenue, margins and earnings. In addition, price competition could adversely
impact margins and earnings.
Because of the factors described above, as well as others that may affect the
Company's operating results, past financial results may not be an accurate
indicator of future performance.
LIQUIDITY AND CAPITAL RESOURCES
As of September 24, 1995, the Company had cash, cash equivalents and temporary
cash investments of $103.1 million, as compared to $86.6 million as of March
31, 1995. Cash provided by operations was $14.0 million during the first six
months of fiscal 1996, which was a $2.0 million increase in cash provided by
operations from the comparable period of the prior year.
Net cash used for investing activities of $22.8 million for the first six
months of fiscal 1996 primarily consisted of $17.0 million in net purchases of
temporary cash investments and $5.7 million in property and equipment
purchases.
Net cash provided by financing activities of $7.8 million for the first six
months of fiscal 1996 results from the issuance of Common Stock relating to
the employee stock benefit plans.
As of September 24, 1995 the Company had available an unsecured $10.0 million
line of credit. Borrowings under this committed facility are available
through May 1996 and would bear interest at the bank's base rate (which
approximates prime). At September 24, 1995, there were no outstanding
borrowings under this facility.
<Page 10>
On October 12, 1995, the Company called for the redemption of $35.0 million of
its outstanding 7-1/4% Convertible Subordinated Debentures due May 15, 2014.
The debentures may be redeemed at 102.9% of the principal amount or may be
converted into shares of Common Stock at a conversion rate of 31.746 shares
for each $1,000 principal amount of Debentures by November 13, 1995. In the
event that 100 percent of the Debentures are redeemed, the Company would be
required to pay $36.0 million in cash to certain bondholders.
The Company believes that current cash and cash equivalents, temporary cash
investments and cash flows from operations will be sufficient to fund
operations, redemption of the called Convertible Debentures, purchases of
capital equipment and research and development programs currently planned at
least through the next twelve months.
<Page 11>
PART II
OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
On August 8, 1995, the Company held its Annual Meeting of
Stockholders. At this meeting, the stockholders voted to
(1) elect Dixon R. Doll and Hans A. Wolf as directors.
Dixon R. Doll received 16,249,410 votes in favor and 391,287
votes against and Hans A. Wolf received 16,254,518 votes in
favor and 386,179 votes against. Continuing as directors
are John B. Arnold, Joseph J. Francesconi, Walter J. Gill
and Frank S. Vigilante; and (2) approve amendments to the
Company's 1993 Stock Option Plan to increase the number of
shares available for issuance by 2,000,000 and to limit the
number of shares that may be granted to any participant in
any one year to 350,000 as follows: 7,532,166 votes in
favor, 4,635,255 votes against, and 106,998 votes
abstaining.
Item 5. Other Information
On October 18, 1995, James K. Dutton was elected as a Class
II Director and was appointed to the Compensation and
Finance Committees of the Board of Directors.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 11: Statement re: Computation of Primary and
Fully Diluted Earnings Per Share.
(b) Reports on Form 8-K
No report on Form 8-K was filed by the Company during
its fiscal quarter ended September 24, 1995.
<Page 12>
SIGNATURE
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.
(REGISTRANT) NETWORK EQUIPMENT TECHNOLOGIES, INC.
BY (SIGNATURE) /s/ Craig M. Gentner
(NAME AND TITLE) Craig M. Gentner
Senior Vice President and
Chief Financial Officer and Secretary
(Principal Financial and Accounting
Officer)
(DATE) November 8, 1995
<PAGE>
EXHIBIT 11
NETWORK EQUIPMENT TECHNOLOGIES, INC.
Computation of Primary and Fully Diluted Earnings Per Share
(in thousands, except per share amounts - unaudited)
<TABLE>
<CAPTION>
Quarter Ended Six Months Ended
Sept. 24, Sept. 25, Sept. 24, Sept. 25,
1995 1994 1995 1994
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Primary
Earnings:
Net income $ 7,448 $ 2,919 $ 13,870 $ 4,346
Interest expense during the period on convertible
subordinated debentures, net of tax (1) - - - 84
-------- -------- -------- --------
$ 7,448 $ 2,919 $ 13,870 $ 4,430
-------- -------- -------- --------
-------- -------- -------- --------
Shares:
Weighted average number of common shares
outstanding 19,430 17,398 19,161 17,265
Number of common equivalent shares assuming
exercise of dilutive stock options 1,148 845 1,120 723
-------- -------- -------- --------
20,578 18,243 20,281 17,988
-------- -------- -------- --------
-------- -------- -------- --------
Primary earnings per share $ .36 $ .16 $ .68 $ .25
-------- -------- -------- --------
-------- -------- -------- --------
Fully Diluted
Earnings:
Net income $ 7,448 $ 2,919 $ 13,870 $ 4,346
-------- -------- -------- --------
-------- -------- -------- --------
Shares:
Weighted average number of common shares
outstanding 19,430 17,398 19,161 17,265
Number of common equivalent shares assuming
exercise of dilutive stock options 1,263 1,327 1,371 1,343
Number of common equivalent shares assuming
conversion of convertible securities (2) - - - -
-------- -------- -------- --------
20,693 18,725 20,532 18,608
-------- -------- -------- --------
-------- -------- -------- --------
Fully diluted earnings per share $ .36 $ .16 $ .68 $ .23
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
- ------------
(1) This amount represents interest on the assumed repurchase of debentures
resulting from the 20% limitation of common stock repurchases under the
modified treasury stock method.
(2) The assumed exercise of these common stock equivalents was excluded as
they were anti-dilutive.
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-END> SEP-24-1995
<CASH> 33,301
<SECURITIES> 69,798
<RECEIVABLES> 69,163
<ALLOWANCES> 3,582
<INVENTORY> 30,096
<CURRENT-ASSETS> 218,587
<PP&E> 26,351
<DEPRECIATION> 95,124
<TOTAL-ASSETS> 258,027
<CURRENT-LIABILITIES> 65,948
<BONDS> 68,625
<COMMON> 197
0
0
<OTHER-SE> 123,257
<TOTAL-LIABILITY-AND-EQUITY> 123,454
<SALES> 102,981
<TOTAL-REVENUES> 162,567
<CGS> 41,310
<TOTAL-COSTS> 82,279
<OTHER-EXPENSES> 59,015
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,657
<INCOME-PRETAX> 21,338
<INCOME-TAX> 7,468
<INCOME-CONTINUING> 13,870
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,870
<EPS-PRIMARY> .68
<EPS-DILUTED> .68
</TABLE>
