Interphase Announces 2006 Fourth Quarter and Full Year Financial Results.Product Leadership Fuels Profitable Year with 8% Revenue Growth PLANO, Texas Plano (IPA: /ˈpleɪnoʊ/) is a wealthy suburb of Dallas, Texas, located to the north, mainly within Collin County, but also extending into Denton County. According to the 2000 U.S. -- Interphase interphase /in·ter·phase/ (in´ter-faz) the interval between two successive cell divisions, during which the chromosomes are not individually distinguishable. in·ter·phase n. Corporation (Nasdaq:INPH), a leading international supplier of next-generation networking technologies, today reported financial results for its fourth quarter and full year ended December 31, 2006. Revenues for the fourth quarter of 2006 were $8.1 million, representing an 8% increase over revenues for the fourth quarter of 2005 of $7.6 million. Fourth quarter 2006 revenues increased 5% compared to revenues of $7.8 million in the third quarter of 2006. The fourth quarter revenues included a one time project cancellation Project cancellation hits around half of U.S. software development projects, whether developed for in-house corporate use or for sale as retail software. When a project is cancelled early on, it has little financial impact but if project sponsors wait until the project has gone fee of $575,000 for unique customer requirements for product development work that was discontinued. Interphase continues to invest in the development of GA (general availability) versions of the cancelled products and expects to generate revenues through sale of these products to other customers. Interphase revenues continue to be driven by the strength in our broadband telecom product portfolio, which rose 30% to $6.4 million in the fourth quarter of 2006 compared to $4.9 million for the fourth quarter of 2005, and as expected, our SlotOptimizer[TM] product line revenues declined to $600,000 compared to $1.9 million on a year to year basis. Gross margin for the fourth quarter of 2006 was 56% compared to 50% for the fourth quarter of 2005. The company recorded a fourth quarter 2006 net income of $458,000, or $0.07 per share, compared to a loss of $(1.1) million, or $(0.19) per share in the fourth quarter of 2005. Full Year 2006 Financial Performance For the full year 2006, revenues were $33.4 million compared to $30.9 million for the full year 2005 representing 8% year to year growth. Gross margin for the year ended December 31, 2006 was 54% compared to 52% for the year ended December 31, 2005. Net income for 2006 was $2.1 million or $0.33 per share, compared to a net loss of $(2.3) million or $(0.40) per share for 2005. The company's balance sheet continues to be solid with a working capital position of $26.9 million, including an improved cash and marketable securities Marketable Securities Very liquid securities that can be converted into cash quickly at a reasonable price. Notes: Marketable securities are very liquid as they tend to have maturities less than one year, and the rate at which these securities can be bought or sold has position of $22.5 million on December 31, 2006. "Interphase culminates a profitable 2006, with a profitable quarter, well established as a key player in the growing AdvancedTCA[R] and MicroTCA[TM] markets," said Greg Kalush, president and chief executive officer of Interphase Corporation. "While our operating results were essentially break-even for the fourth quarter, they represent roughly a $1 million improvement over the fourth quarter 2005 operating results and a $2.9 million improvement on a full year basis. Our strategy has been to invest in research and development resources aimed at new high-growth market opportunities such as AdvancedTCA and MicroTCA with product solutions to satisfy design win opportunities at our key customer accounts and capitalize on Cap´i`tal`ize on` v. t. 1. To turn (an opportunity) to one's advantage; to take advantage of (a situation); to profit from; as, to capitalize on an opponent's mistakes s>. revenue-generating applications and services, while maintaining operational excellence in serving our current customers with our extensive line of products. In 2006, Interphase enhanced its product portfolio with the addition of a number of AdvancedMC products and also introduced its 1/10 Gigabit Ethernet An Ethernet standard that transmits at 1 Gbps. Used mostly to connect high-end workstations and servers as well as for network backbones, Gigabit Ethernet transmits full duplex from point to point using switches and half duplex in a shared environment (CSMA/CD) using a hub. AdvancedTCA carrier card; during the year Interphase also introduced new PCI-X (PCI eXtended) An enhanced PCI bus technology originally developed by IBM, HP and Compaq that is backward compatible with existing PCI cards. PCI and 32-bit PCI-X slots are physically the same, and PCI cards can plug into PCI-X slots. and PCI-Express products for use in telecommunication server platforms across multiple applications. In addition, we successfully delivered RoHS compatible PMC (1) See Portable Media Center. (2) (PCI Mezzanine Card) A PCI-based mezzanine card that is widely adapted to VMEbus, CompactPCI and PCI cards. and PCI (1) (Payment Card Industry) See PCI DSS. (2) (Peripheral Component Interconnect) The most widely used I/O bus (peripheral bus). products into Europe and Asia in advance of the July 1, 2006 European deadline, earning acclaim from our customers. Interphase also expanded its customer base as well as extended its reach into the marketplace with key alliances and partnerships. At the end of 2006 Interphase is very well positioned to participate successfully in the delivery of products across multiple platform architectures to address the growing needs for intelligent building block solutions in the telecommunications marketplace. Despite the ongoing merger and integration activity facing the industry today, the Interphase team executed effectively to deliver top line and bottom line growth during the year. We are finishing 2006 with a strong product portfolio to address the needs of our customers as they gear up for their next generation of AdvancedTCA and MicroTCA solutions. I am very proud of the performance of this team in 2006, and look forward with anticipation to solid execution in 2007." About Interphase Corporation Interphase Corporation (Nasdaq:INPH) is a leading provider of robust building blocks, highly integrated subsystems and innovative gateway appliances for the converged communications network. Building on a 30-year history of providing advanced I/O (Input/Output) The transfer of data between the CPU and a peripheral device. Every transfer is an output from one device and an input to another. See PC input/output. I/O - Input/Output solutions for telecom and enterprise applications, and addressing the need for high speed connectivity, Interphase has established a key leadership role in delivering next generation AdvancedTCA([R]) (ATCA See AdvancedTCA. ), MicroTCA[TM] and AdvancedMC[TM] (AMC (Advanced Mezzanine Card) See AdvancedTCA. ) solutions to the marketplace. Headquartered in Plano, Texas with sales offices across the globe, Interphase clients include Alcatel-Lucent, Ericsson, Fujitsu Ltd., Hewlett Packard, Motorola Inc., Nokia Networks, Nortel Networks Ltd. and Samsung. Interphase is a contributor member of the Scope Alliance and the Communications Platform Trade Association (CP-TA). Additional information about Interphase and its products is available on the company's Web site at www.interphase.com. Interphase is an Affiliate member of the Intel([R]) Communications Alliance. The Intel Communications Alliance is a member-based program comprised of communications and embedded developers and solution providers. Members are committed to providing a strategic supply of standards-based solutions to the communications and embedded market segments. For more information, please visit: www.intel.com/go/ica. Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. This press release contains forward-looking statements with respect to financial results and certain other matters. These statements are made under the "safe harbor" provisions of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995 and involve a number of risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Such risks and uncertainties include, without limitation, fluctuations in demand, the quality and price of similar or comparable networking products, access to sources of capital, general economic conditions in the company's market areas, and that future sales and growth rates Growth Rates The compounded annualized rate of growth of a company's revenues, earnings, dividends, or other figures. Notes: Remember, historically high growth rates don't always mean a high rate of growth looking into the future. for the industry and the company could be lower than anticipated. Interphase, the Interphase logo, SlotOptimizer and iNAV are trademarks or registered trademarks of Interphase Corporation. All other trademarks are the property of their respective owners. Condensed con·dense v. con·densed, con·dens·ing, con·dens·es v.tr. 1. To reduce the volume or compass of. 2. To make more concise; abridge or shorten. 3. Physics a. Consolidated Financial Statements Consolidated Financial Statements The combined financial statements of a parent company and its subsidiaries. Notes: Because consolidated financial statements present an aggregated look at the financial position of a parent and its subsidiaries, they enable you to gauge [TABLE OMITTED] [TABLE OMITTED] |
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