SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 MARCH 31, 1997
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
FROM _______TO _______
Commission File No. 0-26690
ELANTEC SEMICONDUCTOR, INC.
(Exact Name of registrant as specified in its charter)
Delaware 77-0408929
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
675 Trade Zone Boulevard, Milpitas, California 95035
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (408) 945-1323
- --------------------------------------------------------------------------------
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
----- -----
As of April 27, 1997, 8,957,312 shares of the Registrant's Common Stock, $0.01
par value, were issued and outstanding.
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
PART I FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements . . . . . . . . . . . . . . . . . 3
Notes to Condensed Consolidated Financial Statements . . . . . . . . . . . . . 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations . . . . . . . . . . . . . . . . . . . . . . . . 8
Item 3. Quantitative and Qualitative Disclosures About Market Risk . . . . . . . . . . 11
PART II OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders .. . . . . . . . . . . . . 12
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . 12
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
Item 1. Condensed Consolidated Financial Statements
ELANTEC SEMICONDUCTOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
------------------------ -------------------------
1997 1996 1997 1996
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Net revenues $8,494 $9,597 $16,495 $18,164
Cost of revenues 4,703 4,557 9,514 8,619
------- ------- -------- --------
Gross profit 3,791 5,040 6,981 9,545
Operating expenses:
Research and development 1,653 1,615 2,936 3,159
Marketing, sales, general and administrative 2,177 2,226 4,284 4,076
------- ------- -------- --------
Total operating expenses 3,830 3,841 7,220 7,235
------- ------- -------- --------
Income (loss) from operations (39) 1,199 (238) 2,310
Interest and other, net 116 116 203 221
------- ------- -------- --------
Income (loss) before taxes 77 1,315 (35) 2,531
Provision (credit) for taxes on income 10 102 (4) 197
------- ------- -------- --------
Net income (loss) $ 67 $1,213 $ (31) $ 2,334
======= ======= ======== ========
Net income (loss) per share $ 0.01 $ 0.13 $ 0.00 $ 0.25
======= ======= ======== ========
Shares used in computing per share amounts 9,281 9,389 8,782 9,282
======= ======= ======== ========
</TABLE>
See accompanying notes to the condensed consolidated financial statements.
<PAGE> 4
ELANTEC SEMICONDUCTOR, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
<TABLE>
<CAPTION>
March 31 Sept. 30
1997 1996 (1)
----------- -----------
(Unaudited)
<S> <C> <C>
ASSETS:
Current assets:
Cash and cash equivalents $ 11,239 $ 9,377
Short-term investments 3,478 6,663
Accounts receivable, net 4,538 4,175
Inventories 6,933 6,475
Prepaid expenses and other current assets 666 554
---------- ----------
Total current assets 26,854 27,244
Property and equipment, net 8,571 7,360
Other assets, net 626 642
========== ==========
Total assets $ 36,051 $ 35,246
========== ==========
LIABILITIES AND STOCKHOLDER'S EQUITY:
Current liabilities:
Accounts payable and accrued liabilities $ 5,431 $ 5,335
Deferred revenue 2,998 3,143
Current portion of long-term debt and capital lease obligations 1,356 1,128
---------- ----------
Total current liabilities 9,785 9,606
Long-term debt and capital lease obligations 2,183 1,566
Stockholders' equity 24,083 24,074
========== ==========
Total liabilities and stockholders' equity $ 36,051 $ 35,246
========== ==========
</TABLE>
(1) The information in this column was derived from the Company's audited
consolidated financial statements at September 30, 1996.
See accompanying notes to the condensed consolidated financial statements.
<PAGE> 5
ELANTEC SEMICONDUCTOR, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
March 31,
-------------------------------
1997 1996
------------ ------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income (loss) $ (31) $ 2,334
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 953 788
Changes in operating assets and liabilities:
Accounts receivable (363) (794)
Inventories (458) (1,017)
Prepaid expenses and other current assets (112) 104
Accounts payable and accrued liabilities 96 788
Deferred revenue (145) (199)
------------ ------------
Net cash provided by (used in) operating activities (60) 2,004
INVESTING ACTIVITIES:
Sale/maturity (purchase) of available-for-sale securities 3,185 (7,526)
Purchase of property and equipment (688) (1,748)
Decrease in other assets 16 303
------------ ------------
Net cash provided by (used in) investing activities 2,513 (8,971)
FINANCING ACTIVITIES:
Payments on capital lease and other debt (631) (422)
Issuance of common stock 40 8,413
------------ ------------
Net cash provided by (used in)financing activities (591) 7,991
Increase in cash and cash equivalents 1,862 1,024
Cash and cash equivalents at beginning of period 9,377 6,009
============ ============
Cash and cash equivalents at end of period $ 11,239 $ 7,033
============ ============
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Lease and installment financing for capital equipment $ 1,476 $ 834
Interest paid $ 123 $ 97
Taxes paid $ 25 $ 136
</TABLE>
See accompanying notes to the condensed consolidated financial statements.
<PAGE> 6
ELANTEC SEMICONDUCTOR, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
NOTE 1. BASIS OF PRESENTATION
The unaudited condensed consolidated financial statements included herein have
been prepared by the Company pursuant to the rules and regulations 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 pursuant to such
rules and regulations. In the opinion of management, all adjustments (consisting
of normal recurring items) considered necessary for a fair presentation have
been included. The results of operations for the three months ended March 31,
1997 are not necessarily indicative of the results to be expected for the entire
year. These consolidated financial statements should be read in conjunction with
the consolidated financial statements and the notes thereto included in the
Company's Annual Report on Form 10-K for the year ended September 30, 1996.
The Company's fiscal year end is the Sunday closest to September 30. The
Company's fiscal quarters end on the Sunday closest to the end of the calendar
quarter. For convenience, the Company has indicated that its quarters end on
December 31, March 31, June 30 and September 30.
NOTE 2. CASH AND CASH EQUIVALENTS
The Company considers all highly liquid investments with an original maturity
(at the date of purchase) of three months or less to be the equivalent of cash
for purposes of balance sheet and statement of cash flows presentation. Cash and
cash equivalents are carried at cost, which approximates market value.
NOTE 3. SHORT-TERM INVESTMENTS
The Company's policy is to invest in various short-term instruments with
investment grade credit ratings. Generally such investments have contractual
maturities of less than one year. All of the Company's marketable investments
are classified as "available-for-sale" and the Company classifies its
available-for-sale portfolio as available for use in its current operations. At
March 31, 1997, there was no significant difference between the fair market
value and the underlying cost of such securities.
NOTE 4. INVENTORIES
Inventories are stated at the lower of standard cost (first-in, first-out
method) or market and consist of the following balances in thousands:
<TABLE>
<CAPTION>
March 31, Sept. 30,
1997 1996
--------- ---------
<S> <C> <C>
Raw materials $ 946 $ 800
Work-in-process 4,632 4,266
Finished goods 1,355 1,409
--------- ---------
$ 6,933 $ 6,475
--------- ---------
</TABLE>
<PAGE> 7
NOTE 5. NET INCOME (LOSS) PER SHARE
Net income per share is calculated based on the weighted average number of
common and dilutive common share equivalents outstanding using the treasury
stock method. Common share equivalents reflect the dilutive effect of
outstanding stock options. Dilutive securities include options and warrants.
Loss per share excludes common equivalent shares, as the effect on net loss per
share is antidilutive.
In February 1997, the Financial Accounting standards Board issued Statement No.
128, Earning 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. The impact is not expected to result in an
increase in primary earnings per share for the second quarter ended March 31,
1997 and is expected to increase primary earnings per share for the second
quarter ended March 31, 1996 by $0.01 per share. The impact of Statement No. 128
on fully diluted earnings per share for these quarters is not expected to be
material.
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Except for the historical information contained herein, matters discussed in the
Form 10-Q may contain forward-looking statements that involve risks and
uncertainties. The Company's actual future results could differ materially from
those discussed here. Factors that could cause or contribute to such differences
include, but are not limited to, those discussed in this section, as well as in
the section entitled "Business" in the Company's 1996 Form 10-K filed with the
Securities and Exchange Commission.
The table below states the income statement items for the three and six months
ended March 31, 1997 and 1996 as a percentage of net revenues and provides the
percentage change in absolute dollars from the previous year:
<TABLE>
<CAPTION>
Three Months Three Months Dollar % Six Months Six Months Dollar %
Ended Ended Change Ended Ended Change
--------------------------------------------- ----------------------------------------------
March 31,1997 March 31,1996 March 31,1997 March 31,1996
---------------- ---------------- ------------------- ---------------
<S> <C> <C> <C> <C> <C> <C>
Net revenues 100.0% 100.0% -11% 100.0% 100.0% -9%
Cost of revenues 55.4% 47.5% 3% 57.7% 47.5% 10%
Gross profit 44.6% 52.5% -25% 42.3% 52.5% 27%
Operating expenses:
Research and development 19.5% 16.8% 2% 17.8% 17.4% 8%
Marketing, sales, general
and administrative 25.6% 23.2% 2% 26.0% 22.4% 5%
</TABLE>
Results of Operations - During the second fiscal quarter of 1997, Elantec
generated net revenues of $8.5 million, a decrease of 11% from the $9.6 million
reported in the same quarter of the previous year. For the first six months of
fiscal 1997 net revenues were $16.5 million, a decrease of 9% from the $18.0
million reported in the corresponding period of fiscal 1996. This decrease is
attributed to a shift in sales mix to lower priced products and overall lower
average selling prices due to competitive market pressures, offset in part by
slightly higher unit sales volumes.
Cost of goods sold increased to approximately 55% of net sales for the second
quarter of fiscal 1997 compared to 48% for the second quarter of fiscal 1996.
During the first six months of fiscal 1997, cost of goods sold increased to
approximately 58% from 48% reported for the corresponding period of fiscal 1996.
The resulting increase in cost and corresponding decrease in gross margins for
each comparable period is primarily due to increased unfavorable overhead
variances, increased reserves for potentially excess or obsolete inventory and
lower average selling prices due to a more competitive market environment.
As a percentage of net revenues, research and development expenses, in absolute
dollars, was flat in the second quarter of 1997 when compared to the comparable
quarter of 1996, but increased to approximately 20% during the first six months
of 1997 from approximately 17% during the first six months of 1996. This
increase is a result of lower net revenues in the second quarter and first half
of fiscal 1997. As the Company moves to the "SOI" technology (see discussion
below), absolute dollar research and development expenses are expected to
increase. However, there can be no assurance that net revenues will increase at
the same rate as anticipated research and development expenses.
Marketing, sales, general and administrative expenses for the second quarter and
first six months of fiscal 1997 were relatively flat compared to the dollar
amounts reported in the same periods in fiscal 1996. As a percentage of net
revenues, marketing, selling and general and administrative expenses increased
to 26% for both the second quarter and first six months of fiscal 1997, from
approximately 23% and 22% of net sales in the second quarter and first six
months of fiscal 1996, respectively. The increase as a percentage of net sales
reflects the lower net revenues in the second quarter and first half of fiscal
1997.
The Company's provision for income taxes for the second quarter of fiscal 1997
is lower than the statutory rate, principally due to the benefit of net
operating loss carryforwards offset by alternative minimum taxes and foreign
withholding taxes.
<PAGE> 9
Factors Affecting Future Results - Elantec's operating results have been, and in
the future may be, subject to fluctuations due to a wide variety of factors
including the timing of or delays in new product and process technology
announcements and product introductions by the Company or its competitors,
competitive pricing pressures, fluctuations in manufacturing yields, changes in
the mix of product sold, availability and costs of raw materials, the cyclical
nature of the semiconductor industry, industry-wide wafer processing capacity,
economic and political conditions in various geographic areas, and costs
associated with other events, such as underutilization or expansion of
production capacity, intellectual property disputes, litigation, or
environmental regulation.
The semiconductor industry is highly cyclical and has been subject to
significant economic fluctuations at various times that have been characterized
by rapidly fluctuating product demand, periods of over and under capacity, and
accelerated erosion of average selling prices. The semiconductor industry is
currently experiencing softened demand, excess capacity and continued pricing
pressures brought about by increased competition. A material change in
industry-wide production capacity, shift in industry capacity toward products
competitive with the Company's products, rapidly fluctuating demand, or other
factors could result in a rapid decline in product pricing or unit volumes which
could adversely affect the Company's operating results.
To address future capacity requirements, the Company plans to complete an
extensive production expansion at its primary manufacturing facility in
Milpitas, California. This expansion program is expected to be complete during
the second quarter of fiscal 1998 and faces a number of substantial risks
including, but not limited to, delays in construction, cost overruns, equipment
delays or shortages, manufacturing start-up or process problems, or difficulties
in hiring key managers and technical personnel. From time to time, the Company
has experienced production difficulties that have caused delivery delays and
quality problems. There can be no assurance that the Company will not experience
manufacturing problems and product delivery delays in the future as a result of,
among other things, changes to its process technologies, ramping production,
installing new equipment at its facilities and constructing new facilities in
California.
The Company's manufacturing expansion will result in a significant increase in
fixed and operating expenses. As commercial production at the new fabrication
facility commences, the operating costs will be classified as cost of revenues,
and the Company will begin to recognize depreciation expense relating to the
facility. Accordingly, although the Company expects the Milpitas fabrication
facility to contribute to revenues in fiscal 1998 and thereafter, the Company
will recognize substantial operating expenses associated with the facility in
1997, which could reduce gross margins. Specifically, as commercial production
begins in fiscal 1998, the Company anticipates incurring substantial operating
costs and depreciation expense relating to the facility before production of
substantial volume is achieved. Accordingly, if revenue levels do not increase
sufficiently to offset these additional expense levels, or if the Company is
unable to achieve gross margin comparable to the Company's current products, the
Company's future results of operations could be adversely impacted.
New products, process technology and start-up costs associated with the Milpitas
wafer fabrication facility will require significant research and development
expenditures. However, there can be no assurance that the Company will be able
to develop and introduce new products in a timely manner, that new products will
gain market acceptance or that new process technologies can be successfully
implemented. If the Company is unable to develop new products in a timely
manner, and to sell them at gross margins comparable to the Company's current
products, the future results of operations could be adversely impacted.
<PAGE> 10
Part of the Company's future bipolar product development strategy includes the
development of an alternative form of silicon-on-insulator ("SOI") technology
called bonded wafers. The Company believes that, if successful, the bonded wafer
technology could provide technologically advanced products at a lower cost than
the current dielectric isolation complementary bipolar technology. However,
there can be no assurance that the development of the bonded wafer technology
can be successfully accomplished in a timely manner or that it will provide the
desired improvements over the Company's current technology. Significant delays
in the development of the bonded wafer technology or manufacturing problems
associated with transferring the Company's current product line to this
technology would have a material adverse affect on the Company's business and
results of operations. In addition, delays in the development of this technology
would adversely affect the Company's new product development program.
The semiconductor industry is extremely capital intensive. To remain
competitive, the Company must continue to invest in advanced manufacturing and
test equipment. The Company expects to expend approximately $4.0 million in
capital expenditures in the second half of fiscal 1997 and anticipates
significant continuing capital expenditures in the next several years. There can
be no assurance that the Company will not be required to seek financing to
satisfy its cash and capital needs or that such financing will be available on
terms satisfactory to the Company. If such financing is required and if such
financing were not available on terms satisfactory to the Company, its
operations would be materially adversely affected.
The semiconductor industry is characterized by vigorous protection and pursuit
of intellectual property rights or positions, which have resulted in significant
and often protracted and expensive litigation. In recent years, there has been a
growing trend of companies to resort to litigation to protect their
semiconductor technology from unauthorized use by others. The Company believes
its products do not infringe upon any valid patents. However, there can be no
assurance that the Company's position in these matters will prevail. There can
be no assurance that additional future claims alleging infringement of
intellectual property rights will not be asserted against the Company. The
intellectual property claims that have been made, or may be asserted against the
Company in the future, could require that the Company discontinue the use of
certain processes or cease the manufacture, use and sale of infringing products.
Additionally, the Company may incur significant litigation costs and damages to
develop noninfringing technology. There can be no assurance that the Company
would be able to obtain such licenses on acceptable terms or to develop
noninfringing technology without a material adverse effect on the Company.
The Company is subject to a variety of regulations related to hazardous
materials used in its manufacturing process. Any failure by the Company to
control the use of, or to restrict adequately the discharge of, hazardous
materials under present or future regulations could subject it to substantial
liability or could cause its manufacturing operations to be suspended.
The Company's Common Stock has experienced substantial price volatility and such
volatility may occur in the future, particularly as a result of
quarter-to-quarter variations in the actual or anticipated financial results of
the Company, the companies in the semiconductor industry or in the markets
served by the Company, or announcements by the Company or its competitors
regarding new product introductions. In addition, the stock market has
experienced extreme price and volume fluctuations that have affected the market
price of many technology companies' stock in particular. These factors may
adversely affect the price of the Common Stock.
<PAGE> 11
Liquidity and Capital Resources - During the first six months of fiscal 1997,
the Company financed its operations primarily from existing cash balances and
short-term investments. At March 31, 1997, the Company had approximately $14.7
million of cash and short-term investments.
Net cash used in operating activities was $60,000 for the six months ended March
31, 1997, and consisted primarily of increases in inventory and accounts
receivable offset by depreciation expense and amortization.
Net sales/maturities of available-for-sale securities were $3.2 million during
the six-month period ended March 31, 1997 and consisted primarily of commercial
paper and short-term corporate notes.
Capital expenditures were $2.2 million during the six-month period ended March
31, 1997 of which $1.5 million was leased using the Company's nonrevolving lease
line of credit. The Company expects to purchase an additional $4.0 million of
capital in the second half of fiscal 1997. Of the total $6.2 million in capital
acquisitions expected in fiscal 1997, the Company plans to finance approximately
$4.5 million using its existing credit facilities.
At March 31, 1997 there was approximately $2.7 million available under this
nonrevolving lease line. The Company is currently negotiating additional
financing arrangements to facilitate the aforementioned manufacturing expansion.
There were outstanding commitments to purchase capital assets of approximately
$1.4 million at March 31, 1997.
Historically, the Company has generated cash through operations and financing
activities in an amount sufficient to fund its requirements. The Company
believes that cash on hand, cash anticipated to be generated from operations and
cash obtained through borrowing or leasing arrangements will be sufficient to
meet the Company's working capital and capital expenditure requirements at least
through the end of fiscal 1997. Any major change in the nature of the Company's
business, such as those mentioned in the previous section, could change the
Company's capital requirements. To the extent the Company requires additional
cash, there can be no assurance that the Company will be able to obtain such
financing on terms favorable to the Company, or at all.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable
<PAGE> 12
PART II - OTHER INFORMATION
ITEM 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Shareholders of the Company (Annual Shareholder Meeting)
was held on February 21, 1997, in Milpitas, California. At the Annual
Shareholder Meeting the shareholders elected members of the Company's Board of
Directors, amended the 1995 Equity Incentive Plan to increase the number of
shares of Common Stock reserved for issuance by 400,000 shares, and ratified the
Company's appointment of Ernst & Young LLP as independent auditors.
The vote for nominated directors was as follows:
<TABLE>
<CAPTION>
Nominee In Favor Withheld
- --------------------- ------------------ --------------
<S> <C> <C>
C.K. Chan 7,122,332 64,206
J.V. Diller 7,125,490 61,048
B.Y. Kamath 7,088,990 97,548
D. O'Brien 7,126,821 59,717
D.T. Valentine 7,126,190 60,348
</TABLE>
The results of voting for approval of an amendment to the 1995 Equity Incentive
Plan to increase the number of shares reserved for issuance by 400,000 shares:
<TABLE>
<CAPTION>
Broker
For Against Abstain Non-Votes
- ------------------- ----------------- -------------- ---------------
<S> <C> <C> <C> <C>
5,685,938 1,200,704 28,398 271,498
</TABLE>
The results of voting for ratification of appointment of Ernst & Young LLP as
independent auditors for the company for the next fiscal year:
<TABLE>
<CAPTION>
For Against Abstain
- ------------------- ----------------- --------------
<S> <C> <C> <C>
7,149,465 17,600 19,473
</TABLE>
ITEM 6. - EXHIBITS AND REPORTS ON FORM 8-K
(a) The following exhibits are filed as part of this report:
Exhibit 11.1 - Statement re Computation of Per Share Earnings (Loss)
Exhibit 27.1 - Financial Data Schedule
(b) Reports on Form 8-K:
The Company filed no reports on Form 8-K during the quarter ended March
31, 1997.
<PAGE> 13
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.
ELANTEC SEMICONDUCTOR, INC.
(Registrant)
Date: May 13, 1997 By: /s/ Terrence W. Plette
----------------------------------
Terrence W. Plette
Chief Financial Officer
(Duly authorized officer and principal
financial officer)
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
<S> <C>
11.1 Statement re Computation of Per Share Earnings (Loss)
27.1 Financial Data Schedule
</TABLE>
<PAGE> 1
Exhibit 11.1
ELANTEC SEMICONDUCTOR, INC.
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS (LOSS)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
March 31, March 31,
-------------------------- --------------------------
1997 1996 1997 (1) 1996
------------ ------------- ------------ -------------
<S> <C> <C> <C> <C>
Net income (loss) $ 67 $ 1,213 $ (31) $ 2,334
========== ========== ========== ==========
Common and common equivalent shares outstanding:
Common stock 8,804 8,496 8,782 8,319
Common stock options 477 893 - 963
---------- ---------- ---------- ----------
Common and common equivalent shares used in
computing per share amounts 9,281 9,389 8,782 9,282
========== ========== ========== ==========
Net income (loss) per share $ 0.01 $ 0.13 $ 0.00 $ 0.25
========== ========== =========== ==========
</TABLE>
(1) Effect of common stock options is excluded for the six months ended March
31, 1997, as their effect is antidilutive
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 11,239
<SECURITIES> 3,478
<RECEIVABLES> 5,031
<ALLOWANCES> 493
<INVENTORY> 6,933
<CURRENT-ASSETS> 26,854
<PP&E> 17,890
<DEPRECIATION> 9,319
<TOTAL-ASSETS> 36,051
<CURRENT-LIABILITIES> 9,785
<BONDS> 2,183
0
0
<COMMON> 88
<OTHER-SE> 23,995
<TOTAL-LIABILITY-AND-EQUITY> 24,083
<SALES> 7,822
<TOTAL-REVENUES> 8,494
<CGS> 4,703
<TOTAL-COSTS> 4,703
<OTHER-EXPENSES> 3,830
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 128
<INCOME-PRETAX> 77
<INCOME-TAX> 10
<INCOME-CONTINUING> 67
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 67
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
</TABLE>
