<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
_X_ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 for the quarterly period ended SEPTEMBER 30, 1996 or
___ Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
COMMISSION FILE NUMBER 1-10981
SBS TECHNOLOGIES, INC.
New Mexico 85-0359415
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
2400 Louisiana Blvd. NE
AFC Building 5, Suite 600
Albuquerque, New Mexico 87110
(505) 875-0600
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 and (2) has been subject to such filing requirements for
the past 90 days.
YES _X_ NO ___
As of November 1, 1996, the Registrant had 3,433,657 shares of its common stock
outstanding.
<PAGE>
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS SEPTEMBER 30, 1996 JUNE 30, 1996
------ ------------------ -------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 2,101,573 1,130,030
Receivables, net (note 2) 7,716,642 6,421,224
Inventories (note 3) 6,425,247 5,160,962
Deferred income tax 343,600 317,100
Prepaid expenses 223,970 303,846
Other current assets 138,768 104,249
----------- ----------
Total current assets 16,949,800 13,437,411
----------- ----------
Property and equipment, at cost 3,532,581 2,389,289
Less accumulated depreciation 1,768,649 1,041,719
----------- ----------
Net property and equipment 1,763,932 1,347,570
----------- ----------
Intangible assets, net 5,351,764 5,571,135
Deferred income taxes 55,900 55,900
Other assets 31,656 31,656
----------- ----------
Total assets $24,153,052 20,443,672
----------- ----------
----------- ----------
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current liabilities:
Current portion of long-term debt $ 1,477,112 1,458,976
Accounts payable 1,995,098 1,243,748
Accrued representative commissions 503,614 353,278
Accrued salaries 931,188 1,077,121
Accrued compensated absences 438,203 340,342
Accrued software license fees 48,000 33,000
Income taxes 790,960 223,381
Other current liabilities 556,593 425,033
Reserve for discontinued operations 62,910 49,553
----------- ----------
Total current liabilities 6,803,678 5,204,432
Long-term liabilities:
Long-term debt, excluding current installments 4,914,949 5,188,320
----------- ----------
Total long-term liabilities 4,914,949 5,188,320
----------- ----------
Total liabilities 11,718,627 10,392,752
----------- ----------
Stockholders' equity:
Common stock, no par value; 30,000,000 shares authorized,
3,430,657 issued and outstanding at September 30, 1996;
3,178,133 issued and outstanding at June 30, 1996 4,998,049 4,690,786
Common stock warrants 180,000 180,000
Retained earnings 7,256,376 5,180,134
----------- ----------
Total stockholders' equity 12,434,425 10,050,920
----------- ----------
Total liabilities and stockholders' equity $24,153,052 20,443,672
----------- ----------
----------- ----------
</TABLE>
See accompanying notes to consolidated financial statements
Page 2
<PAGE>
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30
-------------------------------
1996 1995
---- ----
<S> <C> <C>
Sales $11,263,466 7,574,885
Cost of sales 5,245,753 3,580,472
----------- ---------
Gross profit 6,017,713 3,994,413
Selling, general and administrative expense 2,673,646 1,549,477
Research and development expense 654,946 684,724
Amortization of intangible assets 219,372 233,376
----------- ---------
Operating income from continuing operations 2,469,749 1,526,836
----------- ---------
Interest income 14,844 959
Interest expense (163,980) (281,360)
----------- ---------
(149,136) (280,401)
----------- ---------
Income from continuing operations before
income taxes 2,320,613 1,246,435
Income taxes 928,200 524,000
----------- ---------
Net income $ 1,392,413 722,435
----------- ---------
----------- ---------
Net income per common and
common equivalent share $ 0.33 0.23
----------- ---------
----------- ---------
</TABLE>
See accompanying notes to consolidated financial statements
Page 3
<PAGE>
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
COMMON TOTAL
STOCK COMMON STOCK-
------------- STOCK RETAINED HOLDERS'
SHARES AMOUNT WARRANTS EARNINGS EQUITY
------ ------ -------- -------- --------
<S> <C> <C> <C> <C> <C>
Balance at June 30, 1995 2,893,654 $3,375,021 $ 75,000 $1,599,227 $ 5,049,248
Exercise of stock options 257,618 1,295,765 - - 1,295,765
Warrants issued for business
acquisition - - 125,000 - 125,000
Exercise of warrants 26,861 20,000 (20,000) - -
Net income - - - 3,580,907 3,580,907
--------- --------- ------- --------- ----------
Balance at June 30, 1996 3,178,133 4,690,786 180,000 5,180,134 10,050,920
--------- --------- ------- --------- ----------
Exercise of stock options 52,524 239,263 - - 239,263
Acquisition of Logical Design
Group Inc. 200,000 68,000 - 683,829 751,829
Net income - - - 1,392,413 1,392,413
--------- --------- ------- --------- ----------
Balance at September 30, 1996 3,430,657 $4,998,049 $180,000 $7,256,376 $12,434,425
--------- --------- ------- --------- ----------
--------- --------- ------- --------- ----------
</TABLE>
See accompanying notes to consolidated financial statements
Page 4
<PAGE>
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SEPTEMBER 30
-------------------------------
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 1,392,413 722,435
----------- ---------
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 117,608 67,192
Amortization of intangible assets 219,372 233,378
Bad debt expense 167,501 25,000
Loss on disposition of assets - (6,203)
Changes in assets and liabilities:
Receivables (1,021,640) (15,656)
Inventories (443,144) (162,566)
Prepaids and other assets 51,386 189,576
Accounts payable 494,366 88,338
Accrued representative commissions 133,096 134,352
Accrued salaries (165,933) 55,707
Accrued compensated absences 31,426 27,899
Accrued software license fees 15,000 3,000
Income taxes 569,131 243,783
Other current liabilities 108,542 (491,900)
----------- ---------
Net adjustments 276,711 391,900
----------- ---------
Net cash provided by operating activities 1,669,124 1,114,335
----------- ---------
Cash flow from investing activities:
Business acquisition (note 4) 1,351 -
Acquisition of property and equipment (207,949) (88,143)
----------- ---------
Net cash used by investing activities (206,598) (88,143)
----------- ---------
</TABLE>
Page 5
<PAGE>
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(CONTINUED)
<TABLE>
<CAPTION>
<S> <C> <C>
Cash flows from financing activities:
Proceeds from notes payable to bank - 1,395,000
Payments on notes payable to bank - (1,845,782)
Payments on liability to stockholder (25,000) (25,000)
Payments on long-term borrowings (705,246) (1,471,804)
Proceeds from exercise of stock options 239,263 362,990
----------- ----------
Net cash provided (used) by financing activities (490,983) (1,584,596)
----------- ----------
Net increase (decrease) in cash and cash equivalents 971,543 (558,404)
Cash and cash equivalents at beginning of period 1,130,030 883,804
----------- ----------
Cash and cash equivalents at end of period $2,101,573 325,400
----------- ----------
----------- ----------
Supplemental disclosure of cash flow information:
Interest paid $ 165,738 274,682
Income taxes paid 352,624 280,217
Noncash financing and investing activities:
Assets acquired through capital leases $ 70,733 -
Summary of assets, liabilities, and equity
acquired through acquisition (note 4):
Cash and cash equivalents $ 1,351
Receivables 441,279
Inventories 821,141
Deferred income tax 26,500
Prepaid expenses 6,029
Net property and equipment 255,288
Accounts payable (256,984)
Accrued representative commissions (17,240)
Accrued salaries (20,000)
Accrued compensated absences (66,435)
Debt (404,277)
Income taxes 1,552
Other current liabilities (36,375)
Common stock (68,000)
Retained Earnings $ (683,829) $ -
----------- ----------
----------- ----------
</TABLE>
See accompanying notes to consolidated financial statements
Page 6
<PAGE>
SBS TECHNOLOGIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
(UNAUDITED)
1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accounting policies as set forth in SBS Technologies, Inc.'s Annual
Report on Form 10-K dated September 23, 1996 have been adhered to in
preparing the accompanying interim consolidated financial statements.
These statements are unaudited but include all adjustments, consisting of
normal recurring adjustments, that the Company considers necessary for a
fair presentation of the results for such interim period. Results for an
interim period are not necessarily indicative of results for a full year.
Certain amounts in the September 30, 1995 financial statements have been
reclassified to conform with the September 30, 1996 presentation.
2) RECEIVABLES, NET
Receivables, net consisted of the following:
SEPTEMBER 30, 1996 JUNE 30, 1996
------------------ -------------
Accounts receivable $6,963,662 5,527,620
Contract receivables:
Amounts billed 641,834 721,803
Recoverable costs and accrued profit
on progress completed - not billed 348,884 242,038
---------- ---------
990,718 963,841
---------- ---------
7,954,380 6,491,461
---------- ---------
Less: allowance for doubtful accounts (237,738) (70,237)
---------- ---------
$7,716,642 6,421,224
---------- ---------
---------- ---------
Recoverable costs and accrued profit not billed are comprised principally
of amounts of revenue recognized on contracts for which billings had not
been presented to the contract owners since the amounts were not billable
at the balance sheet date, because contract specified milestones had not
yet been reached or because progress billings are restricted by the
contract to a percentage of costs incurred.
3) INVENTORIES
Inventories are valued at average cost which does not exceed market.
SEPTEMBER 30, 1996 JUNE 30, 1996
------------------ -------------
Raw materials $3,082,497 2,254,788
Work in process 2,131,551 1,546,800
Finished goods 1,211,199 1,359,374
---------- ---------
$6,425,247 5,160,962
---------- ---------
---------- ---------
Page 7
<PAGE>
SBS TECHNOLOGIES, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1996
(CONTINUED)
4) BUSINESS ACQUISITIONS
On August 19, 1996, the Company acquired Logical Design Group, Inc.
("LDG"), a Raleigh, North Carolina based designer and manufacturer of
Intel-based VME central processing unit boards. The acquisition qualified
as a pooling of interests for accounting purposes and constituted a tax
free reorganization for federal income tax purposes. Under the terms of
the agreement, LDG shareholders exchanged all outstanding shares of LDG
stock for 200,000 shares of the Company's stock.
The financial position and results of operations of the Company and LDG are
combined in fiscal 1997 on a prospective basis. LDG's historical results
do not have a material affect on combined financial position or results of
operations.
5) SUBSEQUENT EVENT
On October 8, 1996, the Company entered an agreement to acquire all of the
outstanding shares of Bit 3 Computer Corporation for a total cash purchase
price of $24 million, subject to the successful completion of a public
offering of 1,500,000 shares of the Company's common stock with estimated
net proceeds to the Company of approximately $34 million. In connection
with the acquisition, the Company has made an assessment, in conjunction
with an independent valuation firm, of purchased assets and technology.
The assessment determined that $11 million of the purchase price
represents technology that does not meet the accounting definitions of
"completed technology," and thus should be charged to earnings under
generally accepted accounting principles. Had the acquisition and the
offering of stock occurred at July 1, 1995, reported net income and net
income per common and common equivalent share for the year ended June 30,
1996 and the quarter ended September 30, 1996 would have been
approximately $503,000 and $0.10, and $2,313,000 and $0.41, respectively.
Page 8
<PAGE>
SBS TECHNOLOGIES, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF CONSOLIDATED
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
THE FOLLOWING DISCUSSION AND ANALYSIS SHOULD BE READ IN CONJUNCTION WITH THE
COMPANY'S FINANCIAL STATEMENTS AND NOTES THERETO. INFORMATION DISCUSSED HEREIN
MAY INCLUDE FORWARD-LOOKING STATEMENTS REGARDING FUTURE EVENTS OR THE
FINANCIAL PERFORMANCE OF THE COMPANY, AND ARE SUBJECT TO A NUMBER OF RISKS AND
OTHER FACTORS WHICH COULD CAUSE THE ACTUAL RESULTS TO DIFFER MATERIALLY FROM
THOSE CONTAINED IN ANY FORWARD LOOKING STATEMENTS. AMONG SUCH FACTORS ARE:
GENERAL BUSINESS AND ECONOMIC CONDITIONS; CUSTOMER ACCEPTANCE AND DEMAND FOR
THE COMPANY'S PRODUCTS; THE COMPANY'S OVERALL ABILITY TO DESIGN, TEST AND
INTRODUCE NEW PRODUCTS ON A TIMELY BASIS; THE NATURE OF THE MARKETS ADDRESSED
BY THE COMPANY'S PRODUCTS; AND OTHER RISK FACTORS LISTED FROM TIME TO TIME IN
DOCUMENTS FILED BY THE COMPANY WITH THE SEC.
RECENT ACQUISITION
On August 19, 1996, the Company completed a pooling of interest transaction
with LDG. LDG manufactures Intel processor-based CPU boards for the standard
bus embedded computer market. The financial results of LDG are not included in
the Company's Consolidated Financial Statements for the periods prior to July
1, 1996 as historical results did not have a material effect on combined
consolidated results of operations. For its fiscal year ended March 31, 1996,
LDG recorded sales of approximately $4.0 million and income from continuing
operations of approximately $103,000.
RESULTS OF OPERATIONS
SALES. For the three month period ended September 30, 1996, sales
increased 48.7% or $3.7 million, from $7.6 million in the three months ended
September 30, 1995 to $11.3 million. This increase was primarily attributable
to the additional sales contributed by LDG which was acquired on August 19,
1996, and pooled effective July 1, 1996, as well as increases from the
Company's avionics and telemetry products. During the three month period ended
September 30, 1996 , prices for the Company's products remained firm and unit
shipments increased.
GROSS PROFIT. For the three month period ended September 30, 1996,
gross profit increased 50.0%, or $2.0 million from $4.0 million, in the three
months ended September 30, 1995 to $6.0 million. For the three month period
ended September 30, 1996, gross margin increased 53.4% of sales from 52.7% in
the three months ended September 30, 1995. This increase was primarily due to
the effects of additional sales volume and reductions in component material
costs.
SELLING, GENERAL AND ADMINISTRATION. For the three month period ended
September 30, 1996, selling, general and administration expense increased
80.0%, or $1.2 million, from $1.5 million in the three months ended September
30, 1995 to $2.7 million and as a percentage of sales increased to 23.7% from
20.7% in the three months ended September 30, 1995. This increase was
primarily the result of the inclusion of the results of LDG, management's
decision to increase reserves and accruals due to the higher level of business
activity and costs associated with acquisitions.
Page 9
<PAGE>
RESEARCH AND DEVELOPMENT. For the three month period ended September
30, 1996, research and development expense decreased 4.3%, or $30,000, from
$685,000 in the three months ended September 30, 1995 to $655,000 and as a
percentage of sales decreased to 5.8% from 9.0% in the three months ended
September 30, 1995. This increase was a result of expenditures relating to the
completion of certain development programs during the 1996 fiscal year.
AMORTIZATION OF INTANGIBLE ASSETS. For the period ended September 30,
1996, amortization of intangible assets decreased 6.0%, or $14,000, from
$233,000 in the three months ended September 30, 1995 to $219,000. This
decrease was a result of completing the amortization of intangible assets
relating to the acquisition of Berg Systems International during the first
quarter of fiscal 1996.
INTEREST EXPENSE, NET OF INTEREST INCOME. For the period ended
September 30, 1996, interest expense, net of interest income decreased 46.8%,
or $131,000, from $280,000 in the three months ended September 30, 1995 to
$149,000. This decrease was the result of the reduction in debt to finance the
acquisition of GreenSpring Computers, Inc.
INCOME TAXES. For the period ended September 30, 1996, income taxes
increased $404,000, or 77.1%, from $524,000 in the three months ended September
30, 1995 to $928,000, representing effective tax rates of 40% and 42%,
respectively.
LIQUIDITY AND CAPITAL RESOURCES
The Company uses a combination of the sale of equity securities, internally
generated funds and bank borrowings to finance its acquisitions, working
capital requirements, capital expenses and operations.
Cash totaled $2.1 million at September 30, 1996, an increase of $972,000 from
June 30, 1996. Net cash provided by operating activities for the three months
ended September 30, 1996 was $1.7 million. Increases in sales volume and
demand for semiconductor parts during the three months ended September 30, 1996
have caused the Company to increase accounts receivable and inventory. In
addition, liabilities increased in line with the current level of business
activity. Net cash used in investing activities for the three months ended
September 30, 1996 of $207,000 was primarily for the purchase of equipment.
The Company utilized cash in financing activities of $491,000 primarily to
repay portions of bank debt.
On April 26, 1996, the Company amended its bank financing agreement with
NationsBank of Texas, N.A. ("NationsBank"), originally entered into in April
1995, to provide the Company with a $6.8 million term loan and a $2.5 million
revolving line of credit. The term loan is a three year note with a five year
amortization maturing on October 30, 1999. This not refinanced a majority of
the Company's outstanding debt, including the $1.0 million not previously
payable to the former shareholders and option holders of GreenSpring entered
into April 1995 at the time the Company acquired GreenSpring. The revolving
line of credit matures on October 30, 1997. The interest rate on the term loan
is NationsBank's prime rate plus 0.25% or LIBOR plus 2.5% in 30, 60, or 90 day
options. The interest rate of the revolving line of credit is NationsBank's
prime rate or LIBOR plus 2.25% in 30, 60, or 90 day options. The amended
financing agreement provides for a security interest by NationsBank in the
Company's receivables, inventories, and equipment and imposes certain
performance ratios on the Company. These ratios include a current maturities
ratio which requires that the Company's net earnings, plus depreciation and
amortization expense for the preceding four quarters from time of measurement
compared to the Company's current portion of its long-term debt, will not be
less than a ratio of 2 to 1, a senior funded debt to EBITDA ratio which
requires that the Company's total debt evidenced by promissory notes, loan
agreements, bonds or similar instruments, but excluding subordinated debt, will
not be greater than a ratio of 1.5 to 1 when compared to the Company's profit
before tax plus interest, depreciation, and amortization expense for the
Page 10
<PAGE>
preceding four quarters from time measurement; and a fixed charge coverage
ratio requiring that the Company's income before tax plus interest expense and
operating lease expense for the preceding four quarters from time of
measurement will not be less than a ratio of 2 to 1 when compared to the
Company's interest expense plus operating lease expense for the same preceding
four quarters. The Company is also prohibited from disposing of or acquiring
certain assets and businesses without the consent of the lender.
At September 30, 1996, the Company was in compliance with all of the covenants
of the amended financing agreement. The outstanding balance on the term loan
with NationsBank at September 30, 1996 was $6.2 million, of which $5.0 million
bears interest at LIBOR plus 2.5% (8.1% at September 30, 1996) and $1.2 million
was at NationsBank's base rate plus 0.25% (8.5% at September 30, 1996). The
term loan is payable in monthly installments of $112,500. As of September 30,
1996, there were no borrowings drawn on the revolving line of credit.
Management believes that financial resources, including its internally
generated funds, available bank borrowings and the net proceeds from this
offering, will be sufficient to finance the Company's current operations and
capital expenditures, excluding acquisitions, for the next twelve months.
SUBSEQUENT EVENT
On October 8, 1996, the Company entered an agreement to acquire all of the
outstanding shares of Bit 3 Computer Corporation for a total cash purchase
price of $24 million, subject to the successful completion of a public offering
of 1,500,000 shares of the Company's common stock with estimated net proceeds
to the Company of approximately $34 million. In connection with the
acquisition, the Company has made an assessment, in conjunction with an
independent valuation firm, of purchased assets and technology. The assessment
determined that $11 million of the purchase price represents technology that
does not meet the accounting definitions of "completed technology," and thus
should be charged to earnings under generally accepted accounting principles.
Had the acquisition and the offering of stock occurred at July 1, 1995,
reported net income and net income per common and common equivalent share for
the year ended June 30, 1996 and the quarter ended September 30, 1996 would
have been approximately $503,000 and $0.10, and $2,313,000 and $0.41,
respectively.
Page 11
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings - None
Item 2. Changes in Securities - None
Item 3. Defaults by the Company upon its Senior Securities - None
Item 4. Submission of Matters to a Vote of Security Holders - None
Item 5. Other Information
On October 8, 1996, the Company entered an agreement to acquire all of
the outstanding shares of Bit 3 Computer Corporation for a total cash
purchase price of $24 million, subject to the successful completion of
a public offering of 1,500,000 shares of the Company's common stock with
estimated net proceeds to the Company of approximately $34 million. In
connection with the acquisition, the Company has made an assessment, in
conjunction with an independent valuation firm, of purchased assets and
technology. The assessment determined that $11 million of the purchase
price represents technology that does not meet the accounting
definitions of "completed technology," and thus should be charged to
earnings under generally accepted accounting principles. Had the
acquisition and the offering of stock occurred at July 1, 1995, reported
net income and net income per common and common equivalent share for the
year ended June 30, 1996 and the quarter ended September 30, 1996 would
have been approximately $503,000 and $0.10, and $2,313,000 and $0.41,
respectively.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits (exhibit reference numbers refer to Item 601 of
Regulation S-K)
10.1 Pooling Agreement dated August 19, 1996 between the
Registrant and Logical Design Group, Ltd. et al, filed as
Exhibit 10(y) of the Registrant's Annual Report on Form 10-K
for the fiscal year ended June 30, 1996 and incorporated
herein by reference.
11. Statement re computation of per-share income
27. Financial data schedule
(b) Reports on Form 8-K - None
Page 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.
SBS TECHNOLOGIES, INC.
Date: November 11, 1996 /s/ Christopher J. Amenson
President and Chief Executive Officer
Date: November 11, 1996 /s/ James E. Dixon, Jr.
Vice President of Finance & Administration
Page 13
<PAGE>
SBS TECHNOLOGIES, INC.
EXHIBIT INDEX
<TABLE>
EXHIBIT NUMBER DESCRIPTION METHOD OF FILING
- -------------- --------------------------------------------- -----------------------
<S> <C> <C>
03.i(1) Articles of Incorporation, as amended. --
03.ii(1) Bylaws, as amended. --
10.1 Pooling Agreement dated August 19, 1996 between the Registrant
and Logical Design Group, Ltd. et al, filed as Exhibit 10(y) of
the Registrant's Annual Report on Form 10-K for the fiscal year
ended June 30, 1996 and incorporated herein by reference.
11. Statement Re Computation of Per-Share Income Filed herewith electronically
27. Financial Data Schedules Filed herewith electronically
</TABLE>
(1) Incorporated by reference to Exhibits 3.1 and 3.2 of the Registrant's
Quarterly Report on Form 10-Q for the quarter ended December 31, 1995.
Page 14
<PAGE>
EXHIBIT 11
SBS TECHNOLOGIES, INC. AND SUBSIDIARIES
COMPUTATION OF PER-SHARE INCOME
TREASURY STOCK METHOD
AS MODIFIED FOR 20% TEST
<TABLE>
<CAPTION>
Three Months Ended
September 30, 1996
------------------
<S> <C>
Proceeds upon exercise of
options and warrants outstanding
(1,503,132 shares at a weighted average exercise price of $6.896) $10,365,598
-----------
-----------
Weighted average number of shares outstanding 3,393,578
Issued shares - exercise of options and warrants 1,503,132
Shares assumed to be repurchased with proceeds from exercise
subject to 20% of average shares outstanding maximum (678,719)
-----------
Total common and common equivalent shares 4,217,994
-----------
-----------
Net income for the year $ 1,392,413
Add: After-tax reduction in interest expense from
the assumed repayment of debt 11,544 (1)
-----------
Adjusted net income $ 1,403,957
-----------
-----------
Total common and common equivalent shares $ 4,217,994
-----------
-----------
Income per common and common equivalent shares $ 0.33
-----------
-----------
Income adjustment:
Proceeds upon exercise $10,365,598
Price of shares assumed repurchased:
Number of shares 678,716
Average market value based on average monthly market
close information as published by NASDAQ 13.855
-----------
9,403,605
-----------
Repayment of debt 961,994
Interest Rate (estimated average interest rate on debt for year) 8%
After tax effect (1 - 40%) 60%
Portion of year 25%
-----------
$ 11,544 (1)
-----------
-----------
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEETS AND CONSOLIDATED STATEMENTS OF OPERATIONS FOUND IN
THE COMPANY'S 10-Q FOR THE YEAR-TO-DATE, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-END> SEP-30-1996
<CASH> 2,101,573
<SECURITIES> 0
<RECEIVABLES> 7,716,642
<ALLOWANCES> (237,738)
<INVENTORY> 6,425,247
<CURRENT-ASSETS> 16,949,800
<PP&E> 3,532,581
<DEPRECIATION> 1,768,649
<TOTAL-ASSETS> 24,153,052
<CURRENT-LIABILITIES> 6,803,678
<BONDS> 0
0
0
<COMMON> 4,998,049
<OTHER-SE> 7,436,376
<TOTAL-LIABILITY-AND-EQUITY> 24,153,052
<SALES> 11,263,466
<TOTAL-REVENUES> 11,263,466
<CGS> 5,245,753
<TOTAL-COSTS> 8,793,717
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 167,501
<INTEREST-EXPENSE> 163,980
<INCOME-PRETAX> 2,320,613
<INCOME-TAX> 928,200
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<NET-INCOME> 1,392,413
<EPS-PRIMARY> .33
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