<PAGE>
- --------------------------------------------------------------------------------
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
for the quarterly period ended August 2, 1997
Commission File Number 0-19558
CENTIGRAM COMMUNICATIONS CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 94-2418021
(STATE OF INCORPORATION) (I.R.S. EMPLOYER
IDENTIFICATION NUMBER)
91 East Tasman Drive
San Jose, California 95134
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
Registrant's telephone number, including area code: (408) 944-0250
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 outstanding shares of the Registrant's Common Stock as of August
29, 1997 was 7,109,000.
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<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
Centigram Communications Corporation
Consolidated Balance Sheets
<TABLE>
<CAPTION>
August 2, November 2,
(In thousands, except share and per share data) 1997 1996
- --------------------------------------------------- ----------- -----------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 21,324 $ 12,668
Short-term investments 25,403 29,408
Trade receivables, net 24,928 27,741
Inventories 9,923 11,467
Deferred tax assets 1,424 1,424
Other current assets 2,437 3,108
--------- ---------
Total current assets 85,439 85,816
Property and equipment, net 14,206 15,249
Intangible assets, net 1,945 2,004
Deposits and other assets 1,008 940
--------- ---------
$ 102,598 $ 104,009
--------- ---------
--------- ---------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 8,881 $ 9,739
Accrued compensation 4,123 4,202
Accrued expenses and other liabilities 9,264 6,424
Current portion of capital lease obligations 118 154
--------- ---------
Total current liabilities 22,386 20,519
Capital lease obligations - 78
Commitments and contingencies
Stockholders' equity:
Preferred stock, $.001 par value, 1,000,000
authorized; none outstanding
Common stock, $.001 par value, 25,000,000
authorized; 7,108,000 and 6,908,000
outstanding 7 7
Treasury stock, at cost; 243,000 shares (2,958) -
Additional paid-in capital 90,758 88,767
Accumulated deficit (7,467) (4,992)
Unrealized loss on investments (23) (36)
Cumulative translation adjustments (105) (34)
Note receivable from officer - (300)
--------- ---------
Total stockholders' equity 80,212 83,412
--------- ---------
$ 102,598 $ 104,009
--------- ---------
--------- ---------
</TABLE>
See accompanying notes.
2
<PAGE>
Centigram Communications Corporation
Consolidated Statements of Operations
(In thousands, except per share amounts - unaudited)
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
August 2, July 27, August 2, July 27,
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net revenue $ 27,010 $ 26,500 $ 79,822 $ 75,046
Cost and expenses:
Costs of goods sold 11,549 10,786 33,731 31,247
Research and development 4,959 5,114 16,103 14,649
Selling, general and administrative 11,640 10,500 34,175 30,869
Other expenses - - 3,563 -
--------- --------- --------- ---------
28,148 26,400 87,572 76,765
--------- --------- --------- ---------
Operating income (loss) (1,138) 100 (7,750) (1,719)
Other income, net 4,437 610 5,501 1,681
--------- --------- --------- ---------
Income (loss) before income taxes 3,299 710 (2,249) (38)
Provision for income taxes 150 - 226 56
--------- --------- --------- ---------
Net income (loss) $ 3,149 $ 710 $ (2,475) $ (94)
--------- --------- --------- ---------
--------- --------- --------- ---------
Net income (loss) per share $ .45 $ .10 $ (.36) $ (.01)
--------- --------- --------- ---------
--------- --------- --------- ---------
Common and common equivalent
shares used in computing per share
amounts 7,019 6,958 6,963 6,800
--------- --------- --------- ---------
--------- --------- --------- ---------
</TABLE>
See accompanying notes.
3
<PAGE>
Centigram Communications Corporation
Consolidated Statements of Cash Flows
(In thousands - unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
August 2, July 27,
1997 1996
--------- ---------
<S> <C> <C>
Cash and equivalents, beginning of period $ 12,668 $ 10,633
--------- ---------
Cash flows from operations:
Net loss (2,475) (94)
Gain on sale of business (3,598) -
Depreciation and amortization 6,943 5,500
Trade receivables 2,713 (8,955)
Inventories 1,544 (4,415)
Other assets 703 (704)
Accounts payable (858) 1,411
Accrued expenses and other liabilities 2,435 (1,357)
--------- ---------
7,407 (8,614)
--------- ---------
Cash flows from investing:
Purchase of short-term investments (101,043) (62,134)
Proceeds from sales and maturities of
short-term investments 110,061 75,650
Purchase of property and equipment (5,783) (7,501)
Purchase of other assets (905) -
--------- ---------
2,330 6,015
--------- ---------
Cash flows from financing:
Proceeds from sale of common stock 1,991 2,158
Note receivable from officer - (300)
Principal payments on capital leases (114) (140)
Acquisition of treasury stock (2,958) -
--------- ---------
(1,081) 1,718
--------- ---------
Net change in cash and equivalents 8,656 (881)
--------- ---------
Cash and equivalents, end of period $ 21,324 $ 9,752
--------- ---------
--------- ---------
</TABLE>
See accompanying notes.
4
<PAGE>
Centigram Communications Corporation
Notes to Consolidated Financial Statements
(unaudited)
BASIS OF PRESENTATION
The accompanying consolidated financial statements have been prepared by the
Company without audit and reflect all adjustments (consisting of normal
recurring adjustments) which are, in the opinion of management, necessary to
reflect a fair statement of the results for the interim periods. For further
information, refer to the audited Consolidated Financial Statements and
footnotes thereto incorporated by reference in the Company's Annual Report on
Form 10-K for the fiscal year ended November 2, 1996. The results of operations
for the quarter and nine months ended August 2, 1997 may not necessarily be
indicative of the results for the fiscal year ending November 1, 1997 or any
future period.
INVENTORIES
Inventories consisted of (in thousands):
August 2, November 2,
1997 1996
--------- -----------
Raw materials $ 3,643 $ 4,603
Work-in-process 3,260 2,898
Finished goods 3,020 3,966
-------- ---------
$ 9,923 $ 11,467
-------- ---------
-------- ---------
OTHER EXPENSES
During the second quarter ended May 3, 1997 the Company recorded other operating
expenses of approximately $3.6 million, consisting of $2.4 million in
restructuring charges and $1.2 million in expenses associated with the
termination of acquisition discussions with Voice-Tel Enterprises and Voice-Tel
Network ("Voice-Tel"). The restructuring charges noted above represent
termination benefits for approximately 35 employees from all functions of the
Company and costs associated with the resignation of the Company's president.
OTHER INCOME, NET
On June 29, 1997, the Company sold it's Text-to-Speech business to Learnout &
Hauspie Speech Products ("L&H") for $5.0 million in L&H common stock. The
Company recorded a pre-tax gain, computed as the difference between the fair
market value of the shares received at closing and the net carrying value of
related Text-to-Speech tangible and intangible assets, of approximately $3.6
million during the third quarter and subsequently sold this L&H stock for an
additional gain of approximately $.3 million.
FASB STATEMENT NO. 128, EARNINGS PER SHARE
In February 1997, the Financial Accounting Standards Board issued Statement No.
128, Earnings per Share, which is required to be adopted on December 31, 1997.
At that time, the Company will be required to change the method currently used
to compute earnings per share and to restate all prior periods. Under the new
requirements for calculating primary earnings per share, the dilutive effect of
stock options will be excluded. Statement No. 128 is not expected to change the
Company's calculations of income (loss) per share for the third quarter and nine
months ended August 2, 1997 and July 27, 1996, respectively.
5
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The following discussion contains forward-looking statements regarding
future events or the future financial performance of Centigram Communications
Corporation ("Centigram" or the "Company") that involve risks and
uncertainties. These statements include but are not limited to statements
related to changes in Centigram's research and development and selling,
general and administrative expenses, Centigram's investments in receivables
and inventories, Centigram's expenditures for capital equipment and
sufficiency of Centigram's cash reserves. Actual results could differ
materially from those anticipated in these forward-looking statements as a
result of certain factors, including but not limited to those set forth in
this Management's Discussion and Analysis of Financial Condition and Results
of Operations under "Certain Trends and Uncertainties".
Centigram designs, manufactures and markets wireless and wireline messaging
and communication systems that integrate voice, data and facsimile on the
Company's communications server and provide access to this multimedia
information through a telephone or a PC. Centigram's applications all operate on
a common hardware and software platform based on industry-standard hardware and
software which is the Company's implementation of its modular expandable system
architecture. Centigram's system architecture enables a user generally to expand
the capacity of a system in cost-effective increments from the Company's
smallest to its largest system configuration.
The Company's systems are based on industry-standard computer hardware and
operating system software. This enables the Company to bring additional product
features and applications to market more quickly, to utilize low-cost, commonly
available components and to capitalize on third party technological
developments. Centigram's systems can be integrated with central office, mobile
switch and paging terminal systems as well as with most telephone PBX systems.
Such systems are used for switching telephone calls in a variety of customer
premises equipment (CPE) and service provider environments. The Company's
products can also connect with a broad range of host and local area network
(LAN) - based computer systems, including systems based on widely-used
mainframes and minicomputers and personal computers in LANs. In addition,
Centigram systems located at different sites can be linked together in a digital
network.
RESULTS OF OPERATIONS
Net revenue for the third quarter of fiscal 1997 was $27.0 million which
was 2% higher than net revenue for the corresponding quarter of fiscal 1996 and
8% higher than the second quarter of fiscal 1997. The increase in net revenue
from the third quarter of 1996 reflects higher sales of large systems and
MobileManager products offset in part by lower sales of upgrade and expansion
products and small systems. The increase in revenue from the second quarter of
1997 generally reflects greater sales of large system products. Sales to
international customers were 47% of revenues for the third quarter as compared
to 33% in the similar period of 1996. Increased large system orders from Latin
America and Asia contributed to this increase in the international business.
Sales to Service Provider customers increased in the third quarter over the
similar prior year period because of increased sales to certain international
customers as noted
6
<PAGE>
above. CPE sales decreased 23% in the third quarter as compared to the prior
year third quarter due to reduced orders from the Company's distributors.
This reduction in orders resulted from a general softness in this CPE
business sector and to a lessor extent increased competition from PC based
systems providers whose products compete with the Company's small system
products.
Net revenue for the first nine months of fiscal 1997 was $79.8 million
which was 6% higher than net revenue for the comparable 1996 period. This
increase in revenue is attributable to higher sales of large system products to
Service Provider customers offset in part by lower sales of systems and upgrade
products and small system sales. Sales to international customers were 49% of
revenues for the nine months of fiscal 1997 as compared to 31% for the similar
period of fiscal 1996 due to increased large system orders from Latin America
and Asia. CPE sales decreased 2% for the first nine months of fiscal 1997 as
compared to the prior year nine month period due to reduced orders from the
Company's distributors as noted above.
There can be no assurance that the market for voice processing products
will grow in future periods at its historical percentage rate or that certain
market segments will not decline. Further, there can be no assurance that the
Company will be able to increase or maintain its market share in the future or
to achieve historical growth rates. See "Certain Trends and Uncertainties."
Gross margin was 57.2%, 59.3%, and 56.5% of net revenue in the third
quarter of fiscal 1997, the third quarter of 1996, and the second quarter of
1997, respectively. The 2.1% decrease in gross margin from the prior year's
third quarter reflects reduced sales of and lower margins in the Company's
upgrade and expansion products partially offset by a favorable mix of increased
sales of large system products and lower provisions for product retrofit
obligations and inventory obsolescence. The slightly higher gross margin in the
third quarter of 1997 as compared to the second quarter of 1997 reflects greater
sales of large system products in the third quarter as a percentage of sales and
lower warranty costs during the third quarter.
For the first nine months of fiscal 1997 the gross margin was 57.7% of net
revenue as compared to 58.4% for the first nine months of fiscal 1996. This .7%
decrease in gross margins reflects the same factors as noted above in the
comparison of the third quarter of fiscal 1997 to the third quarter of fiscal
1996. See "Certain Trends and Uncertainties."
Research and development (R&D) expenses decreased 3% in the third quarter
of fiscal 1997 as compared to the corresponding quarter of 1996 and were 9%
below the R&D expenses for the second quarter of fiscal 1997. These reductions
in R&D expenses reflect savings resulting from lower R&D staffing levels offset
in part by higher travel and supplies costs. R&D expenses represented 18%, 19%,
and 22% of net revenue in the third quarter of 1997, the third quarter of 1996,
and the second quarter of 1997, respectively.
For the first nine months of fiscal 1997 R&D spending was up 10% over the
comparable period in fiscal 1996 and represented 20% of net revenues for both
periods. These increases reflect higher payroll expenses resulting from higher
staffing levels and increased travel and supplies expenses. The Company believes
that ongoing development of new products and features
7
<PAGE>
is required to maintain and enhance its competitive position. The Company
expects to continue to invest in R&D and therefore R&D expenses should
increase in future periods, notwithstanding the level of sales realized in
future quarters. Accordingly, while the Company expects to control expenses
where possible in forthcoming quarters, its R&D expenses may increase.
Selling, general and administrative (SG&A) expenses for the third quarter
of fiscal 1997 were 11% above the SG&A expenses for the third quarter of fiscal
1996. These increases reflect primarily increased sales and marketing expenses,
including increases in salaries and commissions. SG&A expenses for the third
quarter of fiscal 1997 were down 2% or $.3 million from the second quarter of
fiscal 1997. SG&A expenses represented 43%, 40%, and 48% of net revenue,
respectively, in the third quarter of 1997, the third quarter of 1996, and the
second quarter of fiscal 1997.
SG&A expenses for the first nine months of fiscal 1997 were up 11% over the
prior year and represented 43% and 41% of net revenues for 1997 and 1996,
respectively. This increase reflects primarily increases in the sales and
marketing expenses. The Company believes continued investments in sales and
customer support, particularly in export markets, are essential to maintaining
its competitive position and that the dollar amount of SG&A expenses will
increase in future periods.
Other expenses were $3.6 million and zero for the first nine months of
fiscal 1997 and 1996, respectively. These operating expenses consisted of $2.4
million in restructuring charges and $1.2 million in expenses associated with
the termination of acquisition discussions with Voice-Tel Enterprises and
Voice-Tel Network ("Voice-Tel"). The restructuring charges represented
termination benefits for approximately 35 employees from all functions of the
Company and costs associated with the resignation of the Company's president.
The Company recorded a provision for income taxes for the third quarter and
first nine months of fiscal 1997 for anticipated foreign income tax liabilities.
No income tax benefit has been recorded for the losses incurred in the first
nine months of fiscal 1997 and 1996, respectively, because realization of the
deferred tax assets arising as a result of the losses sustained are dependent
upon future taxable income, the amount and timing of which are uncertain.
Accordingly, a valuation allowance has been established to fully offset the
deferred tax assets resulting from the losses incurred.
LIQUIDITY AND CAPITAL RESOURCES
Cash and cash equivalents and short-term investments at August 2, 1997 were
$46.7 million, increasing $6.2 million from the second quarter balance of $40.5
million and increasing $4.6 million from the year end balance of $42.1 million.
For the first nine months ended August 2, 1997 the net cash generated from
operating activities was $7.4 million. Trade receivables at the end of the third
fiscal quarter decreased $2.7 million from the year end balance primarily due to
reduced revenues in the third quarter as compared to the last quarter in fiscal
1996. Days sales outstanding (computed using quarterly revenues) were 83 days in
the third quarter as compared to 85 days at end of fiscal 1996. This
8
<PAGE>
decrease in days sales outstanding was primarily due to improved collections
from domestic customers including the collection of outstanding overdue
balances. Inventory levels at August 2, 1997 were $1.5 million lower than the
year end balance due to improved management of the Company's inventory
stocking levels and reduced purchases. The Company expects investments in
receivables and inventories will continue to represent a significant portion
of working capital.
During the first nine months ended August 2, 1997, the Company made capital
expenditures of approximately $5.7 million. These expenditures consisted
primarily of purchases of computer equipment, software, and engineering lab
equipment. The Company currently expects to spend approximately $8.0 million for
capital equipment during fiscal 1997. On April 15, 1997 the Company's Board of
Directors authorized a stock repurchase program whereby up to 1 million shares
of its Common Stock may be repurchased in the open market from time-to-time.
During the third quarter the Company purchased under this repurchase program
243,000 shares at a cost of $3.0 million. The Company presently believes,
notwithstanding its accumulated deficit, that its existing cash and short-term
investments and amounts available under its line of credit and lease credit
arrangements, will be sufficient to support the Company's working capital,
capital equipment purchase requirements, and stock repurchase program at least
through fiscal 1997.
The Company's principal sources of liquidity as of August 2, 1997 consisted
of $46.7 million of cash and cash equivalents and short-term investments and
$20.0 million available under the Company's bank line of credit which expires
April 29, 1998. This bank line requires the Company to maintain certain
financial ratios, minimum working capital, minimum tangible net worth, and
financial performance, and requires the bank's consent for the payment of cash
dividends. There were no borrowings outstanding under the bank line as of August
2, 1997.
CERTAIN TRENDS AND UNCERTAINTIES
The Company has in the past experienced and will likely in the future
experience substantial fluctuations in quarterly operating results. The Company
generally has no long-term order commitments from its customers, and a
significant portion of bookings and shipments in any quarter have historically
occurred near the end of the quarter. Accordingly, the Company has historically
operated with very little backlog, and net revenue has been difficult to
predict. In addition, the portion of backlog shippable in the next quarter
varies over time. As a result, revenue in future quarters will depend largely on
the level of orders received during such quarters.
If new order bookings do not meet expected levels, or if the Company
experiences delays in shipments at the end of a quarter, operating results
will be adversely affected, and these developments may not become apparent to
the Company until near or at the end of a quarter. Net revenue can also be
affected by product sales mix, distribution mix, the size and timing of
customer orders and shipments, customer returns and reserves provided
therefor, competitive pricing pressures, the effectiveness of key
distributors in selling the Company's products, changes in distributor
inventory levels, the timing of new product introductions by the Company and
its competitors, regulatory approvals, and the availability of components for
the Company's products, each of which is difficult to predict accurately.
Each of such factors has in the past affected the Company's revenue.
9
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A significant portion of the Company's net revenue is attributable to a
limited number of customers. The Company's top five customers, representing a
combination of major distributors and service providers, accounted for
approximately 34% and 27% for the third quarter and nine months of fiscal
1997 and 36% and 37% for the similar periods in fiscal 1996, although the
five largest customers were not the same in these periods. The Company has no
long-term order commitments from any of its customers. Any material reduction
in orders from one or more of such customers or the cancellation or deferral
of any significant portion of backlog could have an adverse effect on net
revenue and operating results. Such concentration of sales typically results
in a corresponding concentration of accounts receivable. Although the Company
has established reserves for uncollectible accounts, the inability of any
large customer to pay the Company could have a material adverse impact on the
Company's financial position, results of operations and cash flows.
Approximately 47% of the Company's sales in the third fiscal quarter ended
August 2, 1997 consisted of sales outside of the United States. The Company's
international sales are subject to a number of additional risks generally
associated with international sales, including the effect on demand for the
Company's products in international markets as the results of any strengthening
or weakening of the U.S. dollar, the effect of currency fluctuations on
consolidated multinational financial results, state imposed restrictions on the
repatriation of funds, import and export duties and restrictions, the need to
modify products for local markets, and the logical difficulties of managing
multinational operations.
The Company's gross margin can be affected by a number of factors,
including changes in product, distribution channel and customer mix, cost and
availability of parts and components, royalty obligations to suppliers of
licensed software, provisions for warranty, retrofits, and excess and obsolete
inventory, customer returns, and competitive pressures on pricing. The Company
has experienced increasing competitive pricing pressure in its international
service provider markets and expects this pricing pressure to continue. Further,
distributors purchase products at discounts, and the Company's margins can
therefore vary depending upon the mix of distributor and direct end user sales
in any particular fiscal period. The Company anticipates that its sales mix will
continue to fluctuate in future periods. In addition, the market for the
Company's products has recently experienced and may continue to experience
significant consolidation as certain of the Company's competitors have acquired
other of the Company's competitors. Many of the Company's competitors possess
greater financial and other resources than the Company and there can be no
assurance that the Company will compete successfully in the future.
The Company's future success will depend in part upon the ability of the
Company to continue to introduce new features and products as the Company's
markets evolve, new technologies become available, and customers demand
additional functionality. The Company's competitors continue to add
functionality to their products, and any failure by the Company to introduce in
a timely manner new products and features that meet customer requirements would
adversely affect the Company's operating results and cash flows. The Company's
ability to develop such new products and features depends in large measure on
its ability to hire and retain qualified technical talent and outside
contractors in highly competitive markets for such services. There can be no
assurance that the Company's product development efforts will be successful, or
10
<PAGE>
that it will be able to introduce new products in a timely manner. Any
material additional delays in the introduction and market acceptance of such
products would be adverse to the Company's business. Moreover, customers'
expectations of the introduction of new products by the Company or its
competitors can adversely affect sales of current products. In addition, upon
the introduction of new products, the Company could be subject to higher
customer returns with respect to prior generations of products, which could
adversely affect the Company's financial position, operating results and cash
flows.
The Company presently uses third parties to perform printed circuit
board and subsystem assembly. In addition, although the Company has not
experienced significant problems with third-party manufacturers in the past,
there can be no assurance that such problems will not develop in the future.
Although the Company generally uses standard parts and components for its
products, certain microprocessors, line cards, application cards and other
semiconductor devices and other components are available from sole sources.
Other components, including power supplies, disk drives, certain other
semiconductor devices and subcontracted line card assemblies, are presently
available or acquired from a single source or from limited sources. The
Company has been notified by suppliers that certain components will no longer
be manufactured. To date, the Company has been able to obtain adequate
supplies of these components in a timely manner from existing sources or,
when necessary, from alternative sources of supply although such alternatives
have resulted in increased costs to the Company. However, the inability to
develop such alternative sources if and as required in the future, to obtain
sufficient sole or limited source components as required, or to locate
alternatives to discontinued parts would have a material adverse affect on
the Company's operating results and cash flows. In addition, the Company's
products are dependent on the QNX software operating system, a multitasking,
real-time operating system for Intel microprocessor-based computers. In
future periods, the Company's products may become increasingly dependent on
software licensed from third party suppliers. There can be no assurance such
licenses will continue to be available to the Company as needed or at
commercially reasonable prices.
In recent years, stock markets have experienced extreme price and volume
trading volatility. This volatility has had a substantial effect on the
market prices of securities of many high technology companies for reasons
frequently unrelated to the operating performance of the specific companies.
These broad markets fluctuations may adversely affect the market price of the
Company's common stock. In addition, the trading price of the Company's
common stock could be subject to wide fluctuations in response to
quarter-to-quarter variations in operating results, announcements of new
products or technological innovations by the Company or its competitors, and
general conditions in the computer and communications industries.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
11.1 Statement of Computation of Net Income (Loss) Per Share.
27.1 Financial Data Schedule.
(b) Reports on Form 8-K
There were no reports filed on Form 8-K during the quarter ended
August 2, 1997.
12
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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.
CENTIGRAM COMMUNICATIONS CORPORATION
(Registrant)
Date: September 10, 1997 By: /s/ Dennis P. Wolf
------------------------------
Dennis P. Wolf
Sr. Vice President and
Chief Financial Officer
13
<PAGE>
EXHIBIT 11.1
Centigram Communications Corporation
Statement of Computation of Net Income (Loss) Per Share
(In thousands, except per share data - unaudited)
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
August 2, July 27, August 2, July 27,
1997 1996 1997 1996
---------- -------- ----------- --------
<S> <C> <C> <C> <C>
Net income (loss) $ 3,149 $ 710 $ (2,475) $ (94)
-------- ------ --------- ------
-------- ------ --------- ------
Computation of common and common
equivalent shares outstanding:
Common stock 6,934 6,866 6,963 6,800
Stock options 85 92 - -
-------- ------ --------- ------
Common and common equivalent shares
used in computing per share amounts 7,019 6,958 6,963 6,800
-------- ------ --------- ------
-------- ------ --------- ------
Net income (loss) per share $ .45 $ .10 $ (.36) $ (.01)
-------- ------ --------- ------
-------- ------ --------- ------
</TABLE>
- -------------------
Fully diluted computation not presented since such amount differs by less than
3% of the net per share amounts shown above.
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S THIRD FISCAL QUARTER 10-Q AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> NOV-01-1997
<PERIOD-START> NOV-03-1996
<PERIOD-END> AUG-02-1997
<CASH> 21,324
<SECURITIES> 25,403
<RECEIVABLES> 25,667
<ALLOWANCES> 739
<INVENTORY> 9,923
<CURRENT-ASSETS> 85,439
<PP&E> 42,393
<DEPRECIATION> 28,187
<TOTAL-ASSETS> 102,598
<CURRENT-LIABILITIES> 22,386
<BONDS> 0
0
0
<COMMON> 7
<OTHER-SE> 80,205
<TOTAL-LIABILITY-AND-EQUITY> 102,598
<SALES> 79,822
<TOTAL-REVENUES> 79,822
<CGS> 33,731
<TOTAL-COSTS> 33,731
<OTHER-EXPENSES> 53,841
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (2,249)
<INCOME-TAX> 226
<INCOME-CONTINUING> (2,475)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,475)
<EPS-PRIMARY> (0.36)
<EPS-DILUTED> (0.36)
</TABLE>
