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 June 30,1997 or
[ ] Transition report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the transition period from ________ to _________.
Commission file number: 33-59598
DIALOGIC CORPORATION
(Exact name of registrant as specified in its charter)
New Jersey 22-2476114
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1515 Route 10
Parsippany, New Jersey 07054
(Address of principal executive office, including zip code)
201-993-3000
(Registrant's telephone number, including area code)
-------------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since last
report)
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___
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
At June 30,1997, there were 15,901,366 shares of Common Stock, no par value,
outstanding.
<PAGE>
DIALOGIC CORPORATION
INDEX
Page Number
Part I. Financial Information
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30,1997 (unaudited) 3
and December 31, 1996
Consolidated Statements of Income for the Three and Six 4
Months Ended June 30,1997 and 1996 (unaudited)
Consolidated Statements of Cash Flows for the Six Months 5
Ended June 30,1997 and 1996 (unaudited)
Notes to Consolidated Financial Statements (unaudited) 6
Item 2. Management's Discussion and Analysis of Financial 8
Condition and Results of Operations
Part II. Other Information
Item 1. Legal Proceedings 12
Item 4. Results of Votes of Security Holders 12-13
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 14
<PAGE>
<TABLE>
PART I. Financial Information
Item 1. Financial Statements
DIALOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
<CAPTION>
June 30, December 31,
1997 1996
(Unaudited)
ASSETS
CURRENT ASSETS:
<S> <C> <C>
Cash and cash equivalents $17,115 $ 11,848
Marketable securities 34,510 37,473
Accounts receivable (net of allowance for doubtful
accounts of $1,109 in 1997 and $829 in 1996) 36,674 34,706
Inventory - net 30,029 27,762
Deferred income tax 1,093 ---
Other current assets 10,571 8,884
------ -------
Total current assets 129,992 120,673
PROPERTY AND EQUIPMENT - net 22,448 20,408
EXCESS COST OF NET ASSETS ACQUIRED 3,933 4,434
OTHER ASSETS 2,900 2,661
----- -------
TOTAL ASSETS $159,273 $148,176
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $8,618 $ 7,043
Accrued expenses 11,957 7,911
Income taxes payable 3,903 4,143
Deferred income taxes --- 752
Current maturities of long-term liabilities 534 559
-------- --------
Total current liabilities 25,012 20,408
------ ------
LONG-TERM LIABILITIES 2,724 2,926
------- -------
SHAREHOLDERS' EQUITY:
Preferred stock, no par value--10,000,000 shares authorized;
none issued
Common stock, no par value--60,000,000 shares authorized;
15,901,366 and 15,774,222 shares outstanding, respectively 204 203
Additional paid-in capital 48,502 46,740
Retained earnings 80,276 72,271
Net unrealized gains on available for sale securities 2,802 5,614
Cumulative translation adjustments (247) 14
-------- ----------
Total shareholders' equity 131,537 124,842
--------- ---------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $159,273 $148,176
======== ========
See Notes to Unaudited Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
DIALOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30, June 30,
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES $63,196 $50,054 $120,285 $98,786
------- ------- -------- -------
COSTS AND EXPENSES:
Cost of goods sold 23,370 19,908 45,139 39,659
Research and development expenses 12,595 9,366 24,849 18,243
Selling, general and administrative expenses 19,873 13,909 38,002 27,392
Goodwill amortization 245 --- 490 ---
Interest expense (25) (66) (57) (69)
Interest income 379 422 765 1,179
Net realized (losses) gains on available
for sale securities --- (25) (4) 9,219
---------- --------- --------- -------
Total costs and expenses 55,729 42,852 107,776 74,965
------- ------- ------- ------
INCOME BEFORE PROVISION FOR
INCOME TAXES 7,467 7,202 12,509 23,821
PROVISION FOR INCOME TAXES 2,688 2,636 4,503 8,643
------ ------- ----- -----
NET INCOME $4,779 $ 4,566 $8,006 $15,178
====== ======== ====== =======
Net income per share $ 0.29 $ 0.28 $ .49 $ .93
======== ======== ======== =======
Weighted average shares outstanding 16,375 16,489 16,437 16,369
======= ====== ====== =======
</TABLE>
See Notes to Unaudited Consolidated Financial Statements
<PAGE>
DIALOGIC CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1997 1996
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $8,006 $15,178
Adjustments to reconcile net income to net cash provided by (used in)
operating activities:
Depreciation and amortization 4,523 2,549
Provision for bad debts 351 211
Deferred income taxes (332) (263)
Changes in operating assets and liabilities (892) (13,649)
Other 223 (8,042)
--------- ----------
Net cash provided by (used in) operating activities 11,879 (4,016)
------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (6,062) (4,856)
Purchases of available for sale securities (4,609) (40,945)
Proceeds from available for sale securities sold 3,237 50,862
Acquisition of business --- ( 820)
---------- ---------
Net cash (used in) provided by investing activities (7,434) 4,241
---------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments under capital lease obligations (25) (60)
Payments of current maturities of long term liabilities (375) (375)
Repayment of notes payable (42) ---
Proceeds from short-term borrowings --- 11,150
Payments on short-term borrowings --- (11,150)
Exercise of stock options 422 451
Issuance of common stock 842 589
---------- --------
Net cash provided by financing activities 822 605
---------- --------
NET INCREASE IN CASH AND CASH EQUIVALENTS 5,267 830
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 11,848 5,987
-------- -------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 17,115 $ 6,817
======= =======
SUPPLEMENTAL DISCLOSURES OF CASH FLOW
INFORMATION:
Cash paid during the period for:
Interest $ 57 $ 66
Income taxes $ 3,557 $ 9,631
SUPPLEMENTAL INFORMATION OF NON CASH INVESTING
AND FINANCING ACTIVITIES:
Change in net unrealized gains on available for sale securities $(2,812) $ (1,966)
Stock and options issued for acquisition of business --- $ 3,795
See Notes to Unaudited Consolidated Financial Statements
</TABLE>
<PAGE>
DIALOGIC CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Unaudited Condensed Consolidated Financial Statements
In the opinion of management, the unaudited condensed consolidated
balance sheet at June 30,1997, and the unaudited consolidated statements
of income and unaudited consolidated condensed statements of cash flows
for the interim periods ended June 30,1997 and 1996 include all
adjustments (including normal recurring adjustments) necessary to present
fairly in accordance with GAAP these financial statements.
In accordance with the rules of the Securities and Exchange Commission,
certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. The year-end
balance sheet data was derived from audited financial statements, but
does not include disclosures required by generally accepted accounting
principles. It is suggested that these condensed statements be read in
conjunction with the Company's most recent Annual Report on Form 10-K for
the fiscal year ended December 31, 1996.
Certain reclassifications were made to the 1996 financial statements to
conform to the 1997 presentation.
2. Accounting Policies
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards (SFAS) No. 128, "Earnings per
share," which is effective for the Company beginning December 15, 1997.
This statement establishes standards for computing and presenting
earnings per share (EPS), and replaces the presentation of primary EPS
(previously defined in Accounting Principles Board (APB), No. 15), with a
presentation of basic EPS. The Company does not expect the adoption of
this statement will have a material effect on its consolidated earnings
per share.
In June 1997, the Financial Accounting Standards Board issued SFAS No.
130, "Reporting Comprehensive Income," which is effective for the Company
beginning January 1, 1998. This statement establishes standards for
reporting and display of comprehensive income and its components
(revenues, expenses, gains and losses) in a full set of general-purpose
financial statements. The Company believes that the information to be
included in deriving comprehensive income, although not currently
presented in a separate financial statement, is disclosed as a part of
these financial statements.
In June 1997, the Financial Accounting Standards Board issued SFAS No.
131, "Disclosures about Segments of an Enterprise and Related
Information" which is effective for the Company beginning January 1,
1998. This statement establishes standards for the way that public
business enterprises report information about operating segments in
annual financial statements and requires that these enterprises report
selected information about operating segments in interim financial
reports issued to shareholders. This Statement supercedes SFAS No. 14 and
amends SFAS No. 94. The Company is currently evaluating the impact to its
current financial statements of the implementation of SFAS 131.
<PAGE>
3. Inventory
Inventory consisted of the following (in thousands):
<TABLE>
<CAPTION>
June 30,1997 December 31,1996
<S> <C> <C>
Raw materials $10,679 $ 10,399
Work-in process 6,277 4,607
Finished goods 13,073 12,756
-------- ------
$30,029 $ 27,762
======= ========
</TABLE>
4. Available for Sale Securities
The following is a summary of the available for sale securities as of June
30,1997 and December 31, 1996 ($000's):
<TABLE>
<CAPTION>
June 30,1997 Cost Gross Gross Estimated
Unrealized Unrealized Fair Value
Gains Losses
<S> <C> <C> <C>
Municipal bonds $27,761 100 --- $27,861
Equity investments 1,954 4,844 (149) 6,649
- --------------------------------------------------------------------------------------------------
Total marketable securities $29,715 4,944 (149) $34,510
- --------------------------------------------------------------------------------------------------
December 31, 1996 Cost Gross Gross Estimated
Unrealized Unrealized Fair Value
Gains Losses
Municipal bonds $26,395 48 26,443
Convertible note; options 1,954 9,083 (7) 11,030
- --------------------------------------------------------------------------------------------------
Total marketable securities $28,349 9,131 (7) $37,473
- --------------------------------------------------------------------------------------------------
</TABLE>
On January 1, 1997 the Company converted its note with Voice Control Systems
Inc. into 1,264,474 shares of capital stock of VCS, after which the Company's
total holdings in VCS amounted to 1,399,715 shares of capital stock. The shares
were classified as available for sale under (SFAS) No. 115. The fair value of
the Company's investment in VCS has been determined by reference to the market
price for VCS stock as quoted on publicly traded exchanges on the representative
valuation dates.
The price per share of VCS stock had declined to $4.75 at June 30,1997 as
compared to $7.88 at December 31, 1996. The decline has been reported net of tax
in the equity section of the Company's balance sheet per (SFAS) No. 115.
<PAGE>
Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITION
A. General
The following discussion and analysis should be read in conjunction with the
Consolidated Financial Statements, the related Notes to Consolidated Financial
Statements and Management's Discussion and Analysis of Results of Operations and
Financial Condition incorporated by reference in the Company's Annual Report on
Form 10-K for the year ended December 31, 1996 and the Unaudited Consolidated
Financial Statements and related Notes to Consolidated Financial Statements
included in Item 1 of Part 1 of this Quarterly Report on Form 10-Q. This Form
10-Q contains forward-looking statements made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
("Forward-Looking Statements"), which involve risks and uncertainties. The
Company's actual results may differ significantly from the results discussed in
the forward-looking statements. Factors that might cause such a difference
include, but are not limited to, product demand and market acceptance risks, the
effect of economic conditions, the impact of competitive products and pricing,
product development, effects of competitive forces and pace of deregulation in
the telecommunications industry, commercialization and technological
difficulties, capacity and supply constraints or difficulties, consolidating of
capital resources, general business and economic conditions, the effect of the
Company's accounting policies, and other risks detailed in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996. Such factors may also
cause substantial volatility in the market price of the Company's common stock.
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make certain estimates and
assumptions that affect the reported amount of costs and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reported
period. Significant estimates in the Company's financial statements include
allowances for accounts receivable and net realizable values of inventories.
Actual results could differ from these estimates.
B. Results of Operations
The following table sets forth, for the periods indicated, the percentage
relationship to net sales of certain items included in the Company's
consolidated statements of income.
<TABLE>
<CAPTION>
Three Months Ended Six Month Ended
June 30, June 30
1997 1996 1997 1996
----- ----
<S> <C> <C> <C> <C>
Revenues 100.0% 100.0% 100.0% 100.0%
Cost and expenses:
Cost of goods sold 37.0 39.8 37.5 40.1
Research and development expenses 19.9 18.7 20.7 18.5
Selling, general and administrative expenses 31.4 27.8 31.6 27.7
Goodwill amortization 0.4 --- 0.4 ---
Net interest income 0.6 0.7 0.6 1.1
Net realized gains on available
for sale securities - net --- --- --- 9.3
------- -------- ------ ------
Income before provision for income taxes 11.9 14.4 10.4 24.1
Provision for income taxes 4.3 5.3 3.7 8.7
------ ------- ------- -------
Net income 7.6% 9.1% 6.7% 15.4%
====== ======= ======= ========
</TABLE>
<PAGE>
The following table sets forth, for the periods indicated, the percentage
increase (decrease) of certain items included in the Company's consolidated
statements of income.
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1997 June 30, 1997
Compared With Compared With
Three Months Ended Six Months Ended
June 30, 1996 June 30, 1996
<S> <C> <C>
Revenues 26.3% 21.8%
Cost and expenses:
Cost of goods sold 17.4 13.8
Research and development expenses 34.5 36.2
Selling, general and administrative expenses 42.9 38.7
Goodwill amortization (1) (1)
Net interest income (1) (1)
Net realized gains on available
for sale securities (1) (1)
Income before provision for income taxes 3.7 (47.5)
Provision for income taxes 2.0 (47.9)
Net income 4.7 (47.3)
_______________________________
(1) Not statistically meaningful
The Company's revenues increased by 26% during the second quarter of 1997 and
by 22% during the first six months of 1997, as compared with the equivalent
periods in 1996. Domestic revenue increased 17% and 12% for the three and six
months ended June 30,1997 as compared to prior periods. Dialogic's products
for large telco and network service applications continue to lead the domestic
growth. International revenues continue to be strong, increasing 50% and 44%
for the three and six month periods ended June 30,1997, as compared with the
equivalent periods in 1996. International revenue growth was particularly
strong in the Company's Asia/Pacific and Latin American markets for the six
month period ended June 30, 1997. Korea and China were the largest areas of
international growth. The following table reflects the Company's revenues
segregated between domestic and international markets for the periods
presented.
</TABLE>
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30, 1997
------------------------ ------------------
1997 1996 1997 1996
---- ---- ---- ----
(Dollars in millions) (Dollars in millions)
Domestic:
<S> <C> <C> <C> <C>
Amount $42.1 $36.0 $79.0 $70.2
Percentage of total revenues 66.6% 71.8% 65.7% 71.0%
International:
Amount $21.1 $14.1 $41.3 $28.6
Percentage of total revenues 33.4% 28.2% 34.3% 29.0%
</TABLE>
Gross margins increased for the three and six months ended June 30, 1997, to
63.0% and 62.5%, as compared to 60.2%and 59.9% for both the three and six months
ended June 30, 1997. The increase in margins reflects the continued effects of
Dialogic's cost reduction efforts across all product lines and general component
cost reductions. The Company anticipates continued cost reductions for the
balance of 1997, through moving a larger proportion of production to a selected
turnkey manufacturing subcontractor. The move is anticipated to be substantially
complete by the end of the fourth quarter 1997. These statements regarding the
timing and cost-savings of the move represent Forward-Looking Statements. The
actual efficiencies and cost savings could differ materially from the Company's
expectations as a result of a variety of factors, including the time required to
complete such transactions, the Company's relationship with the manufacturer,
the manufacturing process, component availability, or the effect of issues
internal to the manufacturer.
Research and development expenditures increased as compared to the three months
ended June 30, 1996 by 34% to $12.6 million for the three month period ended
June 30,1997 and by 36% to $24.8 million for the six months ended June 30,1997.
Research and development expenses as a percentage of sales represented 20% and
21% for the three and six month period ended June 30,1997 as compared to 19% and
18% for the preceding year. The increase in research and development
expenditures as compared to June 30,1996 in significant part reflects the
continued substantial investment of engineering resources related to Dialogic's
DM3 Mediastream Resource Architecture ("DM3") announced in the first quarter of
1997. The Company believes that investment in research and development is
critical to future growth and anticipates investing at current levels throughout
the remainder of 1997 in an effort to enable the Company to maintain its
technological leadership in the market place. This estimate regarding future
research and development as a percentage of revenue represents a Forward-Looking
Statement and could differ materially from the Company's expectations as a
result of a variety of factors including variations in revenue, product market
and competitive conditions and the availability of required resources.
Selling, general and administrative expenses increased as compared to the three
and six months ended June 30, 1996 by 43% to $19.8 million and 39% to $38.0
million for the three and six month periods ended June 30,1997. The increase in
selling, general and administrative expenses is partially attributable to the
continuing growth of domestic and international sales and marketing efforts and
costs associated with the hiring and relocation of senior executive staff
members. In addition during the six months ended June 30,1997 the Company
recognized amortization expense of goodwill associated with the acquisition of
Dianatel Corporation on June 27,1996. Amortization will continue to be expensed
over the useful life not to exceed sixty months.
Net interest income for the six month period decreased $414,000 over the
comparable period ended June 30, 1996. The decrease reflects the loss of
interest income due to the conversion of the VCS (Voice Control Systems Inc.)
note into capital stock of VCS in January of 1997. Dialogic will no longer
receive interest income benefits for this transaction as the Company no longer
holds an interest bearing obligation from VCS. Future gains or losses will be
realized on disposition of the VCS equity. During the first quarter of 1996, the
Company realized a pretax gain of $ 9.1 million on the sale of VCS stock.
Net income for the second quarter of 1997 was $4.8 million or $.29 per share,
and $8.0 million or $.49 per share for the six month period ended June 30, 1997.
For the comparable three and six month periods ended June 30, 1996, excluding
the after tax effect of realized gains on available for sale securities, net
income was $4.6 million or $.28 per share and $9.4 million or $.58 per share,
respectively. Earnings for the six months ended June 30,1996 including the above
mentioned item were $15.2 million or $.93 per share. Management believes that
this additional measurement of earnings is useful and meaningful to an
understanding of the operating performance of the Company. However, this
measurement of earnings should not be considered by the reader as an alternative
to net income as an indicator of the Company's operations, performance, or to
cash flows as an indicator of liquidity. Weighted average shares outstanding
represented 16.4 million at June 30,1997 and 1996.
C. Financial Condition
As of June 30,1997 and December 31, 1996, Dialogic had working capital of $105
million and $100 million respectively, and a current ratio (i.e., the ratio of
current assets to current liabilities) of 5.2 to 1 and 5.9 to 1, respectively.
For the six months ended June 30,1997, Dialogic's cash and cash equivalents
increased by $3.9 million (net of unsettled security transactions of $1.4
million). Cash flows provided by operating activities amounted to $11.9 million
including $8.0 million from net income and $4.5 million from depreciation and
amortization. Cash flow used in investing activities was $7.4 million primarily
for capital expenditures. Capital expenditures reflect the expansion of the
Company's headquarters and costs associated with Dialogic's move of its
GammaLink and Dianatel operations from Sunnyvale to Santa Clara, California.
Cash provided by financing activities was $.8 million, consisting primarily of
proceeds from the exercise of stock options and the issuance of common stock,
offset by debt repayments. Dialogic believes that its current liquidity, coupled
with cash generated from operations and credit available under its credit lines,
will be sufficient to meet its liquidity and capital requirements for at least
the next twelve months. This statement constitutes a Forward-Looking Statement.
The actual sufficiency of such capital resources could differ materially from
the Company's expectations, depending among other things upon the extent to
which unanticipated capital requirements may arise and the extent to which
unanticipated events may have a materially adverse effect on the Company's
profitability.
<PAGE>
PART II. Other Information
Item 1. Legal Proceedings
For information regarding certain pending legal proceedings, see Item
3 of the Company's Annual Report on Form 10-K for the year ended
December 31, 1996.
Item 4. Results of Votes of Security Holders
The Annual Meeting of Stockholders was held on April 29, 1997, in
Whippany, New Jersey. A class of two directors was nominated by the
Board of Directors to serve for a three-year term and was elected at
the meeting. At such meeting, 15,829,032 shares were entitled to vote
and a plurality of the votes was needed for election. The Table below
discloses the vote which was recorded for each nominee for office.
In favor Withheld
Masao Konomi 12,218,482 280,239
James J. Shinn 12,218,482 280,239
The results of the voting on the additional items were as follows:
a) To adopt the Company's 1997 Incentive Benefit Plan (as set forth in
the Board's Proxy Statement).
For Against Abstain Broker non-vote
7,685,101 1,838,393 75,986 6,229,552
b) To approve the Amendment of the Company's 1988 Incentive
Compensation Plan (as set forth in the Board Proxy Statement).
For Against Abstain Broker non-vote
11,961,145 278,432 50,691 3,538,764
c) To adopt the Amendment and Restated 1993 Non-Employee Director
Stock Option Plan (as set forth in the Board's Proxy Statement).
For Against Abstain Broker non-vote
11,987,716 278,802 23,750 3,538,764
d) To adopt the Director Stock Election/Deferral Plan (as set forth
in the Board's Proxy Statement)
For Against Abstain Broker non-vote
12,103,612 114,256 74,000 3,537,164
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
11.1 - Calculation of net income per share June 30,1997
11.2 - Calculation of net income per share June 30, 1996
27.1 - Financial Data Schedule
(b) A Current Report on Form 8-K was filed on May 1, 1997
disclosing (under Item 5) the appointment of Thomas G.
Amato as Vice President and Chief Financial Officer.
<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.
DIALOGIC CORPORATION
By: /s/Thomas G. Amato
Thomas G. Amato
Vice President,
Chief Financial Officer
Dated: August 14, 1997
<PAGE>
EXHIBIT INDEX
Exhibit No. Exhibit Page
11.1 Calculation of Net Income Per Share E-1
11.2 Calculation of Net Income Per Share E-2
27.1 Financial Data Schedule E-3
<TABLE>
<CAPTION>
Exhibit 11.1
DIALOGIC CORPORATION AND SUBSIDIARIES
CALCULATION OF NET INCOME PER SHARE
(In thousands, except per share amounts)
Three Months Ended Six Months Ended
June 30,1997 June 30, 1997
<S> <C> <C>
Net income applicable to shares used in
calculation of net income per share $4,779 $8,006
====== ======
Shares used in calculation of net income per share:
Weighted average shares outstanding 15,889 15,839
Dilutive effect of stock options after
application of treasury stock method 486 598
-------- ----------
Number of shares used in calculation
of net income per share 16,375 16.437
====== ======
Net income per share $ .29 $ .49
======== ========
</TABLE>
<TABLE>
Exhibit 11.2
DIALOGIC CORPORATION AND SUBSIDIARIES
CALCULATION OF NET INCOME PER SHARE
(In thousands, except per share amounts)
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1996 June 30, 1996
-------------- -------------
<S> <C> <C>
Net income applicable to shares used in
calculation of net income per share $ 4,566 15,178
======= ==========
Shares used in calculation of net income per share:
Weighted average shares outstanding 15,601 15,557
Dilutive effect of stock options after
application of treasury stock method 888 812
-------- ----------
Number of shares used in calculation
of net income per share 16,489 16,369
======== ==========
Net income per share $ .28 $ .93
========= ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> This financial data schedule contains summary financial information
extracted from Dialogic Corporation's financial statements and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 17,115
<SECURITIES> 34,510
<RECEIVABLES> 36,674
<ALLOWANCES> 1,109
<INVENTORY> 30,029
<CURRENT-ASSETS> 133,146
<PP&E> 42,293
<DEPRECIATION> (19,845)
<TOTAL-ASSETS> 162,427
<CURRENT-LIABILITIES> 28,166
<BONDS> 0
0
0
<COMMON> 204
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 162,427
<SALES> 0
<TOTAL-REVENUES> 120,285
<CGS> 45,139
<TOTAL-COSTS> 45,139
<OTHER-EXPENSES> 63,341
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 58
<INCOME-PRETAX> 12,509
<INCOME-TAX> 4,503
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 8,006
<EPS-PRIMARY> 0
<EPS-DILUTED> .49
</TABLE>
