<SEC-DOCUMENT>0000356037-11-000009.txt : 20110803
<SEC-HEADER>0000356037-11-000009.hdr.sgml : 20110803
<ACCEPTANCE-DATETIME>20110803092217
ACCESSION NUMBER:		0000356037-11-000009
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20110803
ITEM INFORMATION:		Results of Operations and Financial Condition
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20110803
DATE AS OF CHANGE:		20110803

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CSP INC /MA/
		CENTRAL INDEX KEY:			0000356037
		STANDARD INDUSTRIAL CLASSIFICATION:	SERVICES-COMPUTER INTEGRATED SYSTEMS DESIGN [7373]
		IRS NUMBER:				042441294
		STATE OF INCORPORATION:			MA
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-10843
		FILM NUMBER:		111005735

	BUSINESS ADDRESS:	
		STREET 1:		43 MANNING ROAD
		CITY:			BILLERICA
		STATE:			MA
		ZIP:			01821
		BUSINESS PHONE:		9786637598

	MAIL ADDRESS:	
		STREET 1:		43 MANNING ROAD
		CITY:			BILLERICA
		STATE:			MA
		ZIP:			01821
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>form8kpressq38311.htm
<DESCRIPTION>FORM 8K FOR PRESS RELEASE Q3 6/30/11
<TEXT>
<HTML>
<HEAD>
<TITLE>SECURITIES AND EXCHANGE COMMISSION</TITLE>
</HEAD>
<BODY LINK="#0000ff" VLINK="#800080">

<B><FONT SIZE=4><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;UNITED STATES</P>
</B></FONT><P>&#9;&#9;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><FONT SIZE=4>SECURITIES AND EXCHANGE COMMISSION</P>
</B></FONT><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Washington, DC 20549</P>

<B><FONT SIZE=6><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT><FONT SIZE=5>FORM 8-K</P>
</B></FONT>
<B><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Current Report Pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934</P>
</B>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Date of Report (Date of earliest event reported):     August 3, 2011</P>

<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><FONT SIZE=5>CSP Incorporated</P>
</B></FONT><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Exact name of the registrant as specified in its charter)</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>
<B><U><P ALIGN="CENTER">Massachusetts</P>
</B></U><P ALIGN="CENTER">(State or other jurisdiction of incorporation)</P>

<P>&nbsp;</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;    &nbsp;<B><U>000-10843</B></U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;         &#9;<B><U>04-2441294</P>
</B></U><P>                     (Commission File Number)               (IRS Employer Identification No.)</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#9;</P>

<P>&nbsp;</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>43 Manning Road, Billerica, Massachusetts</B></U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;   &nbsp;<B><U>01821-3901</P>
</B></U><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;     (Address of principal executive offices) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Zip Code)</P>

<P>&nbsp;</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B><U>(978) 663-7598</P>
</B></U><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(Registrant's telephone number, including area code)</P>

<P>Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>

<FONT SIZE=4><P>&#9633;  </FONT>Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)</P>
<FONT SIZE=4><P>&#9633;  </FONT>Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)</P>
<FONT SIZE=4><P>&#9633;  </FONT>Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act </P>
<P>    (17 CFR 240.14d-2(b))</P>
<FONT SIZE=4><P>&#9633;  </FONT>Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act </P>
<P>    (17 CFR 240.13e-4(c))</P>

<P>&nbsp;</P>
<B><P>Item 2.02&nbsp;&nbsp;&nbsp;Results of Operations and Financial Condition.</P>
</B>
<P>&#9;On August 3, 2011, CSP Inc. (the &quot;Company&quot;) issued a press release announcing its financial results for the third quarter fiscal year 2011 which ended June 30, 2011.  A copy of the press release relating to such announcement is attached hereto as Exhibit 99.1 and is incorporated herein by reference.</P>

<P>&#9;The information set forth in this Form 8-K, including the exhibits attached hereto, shall not be deemed &quot;filed&quot; for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liability of that Section.  The information in this Form 8-K shall not be deemed incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing, except as shall be expressly set forth by specific reference in such filing.</P>

<B><P>Item 9.01&nbsp;&nbsp;&nbsp;Financial Statements and Exhibits.</P>

<P>(c)&#9;Exhibits</P>
<P>&#9;99.1&#9;Press Release Dated August 3, 2011.</P>

</B><P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</P>

<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P ALIGN="CENTER">SIGNATURE</P>

<P>&nbsp;</P>
<P>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 hereunto duly authorized.</P>

<P>&#9;&#9;&#9;&#9;&#9;&#9;CSP INC.</P>
<P>&#9;&#9;&#9;&#9;&#9;</P>

<P>Date:  <U>August 3, 2011</U>&#9;&#9;&#9;&#9;By:  <U>/s/Gary W. Levine</P><DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>
<DIR>

</U><P>           Gary W. Levine</P>
<P>           Vice President Finance and </P>
<P>           Chief Financial Officer</P>
</B><U><FONT FACE="Courier"><P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
</U><P>&nbsp;</P>
<P>&nbsp;</P>
</FONT><U><P>&nbsp;</P>
<P>&nbsp;</P>
</U><P>&nbsp;</P>
<P>&nbsp;</P>
<FONT FACE="Courier"><P>&nbsp;</P></DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>
</DIR>

</FONT><U><P>Contact:&#9;Gary Levine&#9;&#9;&#9;&#9;&#9;&#9;&#9;</P>
</U><P>&#9;&#9;Chief Financial Officer</P>
<P>&#9;&#9;CSP Inc.</P>
<P>&#9;&#9;Tel:  978.663.7598 ext. 1200&#9;&#9;&#9;</P>
<P>&#9;&#9;Fax: 978.663.0150</P>
<B><FONT FACE="Courier"><P ALIGN="CENTER"></P>
<P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
</FONT><P ALIGN="CENTER">CSP Inc. Reports Third-Quarter Fiscal 2011 Financial Results<BR>
</P>
</B><P>BILLERICA, MA, August 3, 2011 - CSP Inc. (NASDAQ: CSPI), a provider of IT solutions, systems integration services and dense cluster computing systems, today reported financial results for the third quarter of fiscal 2011 ended June 30, 2011.</P>

<P><A NAME="OLE_LINK1"><A NAME="OLE_LINK2">For the third quarter of fiscal 2011, total sales were $19.7 million compared with $28.6 million for the third quarter of 2010.  For the first nine months of 2011, sales were $61.0 million compared with $71.2 million in the year-earlier period.  </P>

<P>Gross profit for the third quarter of fiscal 2011 was 18.0% compared with 17.0% in the third quarter a year ago.  For the first nine months of fiscal 2011, gross profit was 20.0% compared with 18.0% in the same period of fiscal 2010.  </P>

<P>Net loss for the third quarter of fiscal 2011 was $0.2 million, or $0.06 per share, compared with net income of $0.6 million, or $0.17 per diluted share, in the third quarter of fiscal 2010.</A></A>  For the first nine months of fiscal 2011, net income was $0.5 million, or $0.13 per diluted share, compared with net income of $0.9 million, or $0.24 per diluted share, for the year-earlier period.  </P>

<P>Cash and short-term investments increased by approximately $2.0 million from fiscal year ended September 30, 2010 to $17.5 million as of June 30, 2011.<B>  </B>CSP purchased approximately $60,000 of common stock during the quarter.  CSP's cash position may vary significantly from quarter to quarter due to the high working capital requirements needed to fund large projects at both its Systems and its Services and Systems Integration segments.  </P>
<FONT SIZE=3>
<B><P>Management Comments </P>
</B></FONT><P>&quot;Our top- and bottom-line performance in the third quarter reflects difficult year-over-year comparisons in both our Systems and our Service and Systems Integration businesses,&quot; said CSP Chairman and Chief Executive Officer Alexander R. Lupinetti.  &quot;The lower revenues are primarily attributable to significantly reduced sales to a major hosting customer at our Service and Systems Integration segment. As we reported previously, that customer had acquired one of our largest competitors in 2010.  In addition, in the third quarter of 2010, our Systems business reported $1.6 million in high margin royalty revenues from Lockheed Martin related to the E2D Advanced Hawkeye aircraft compared with only $0.5 million in lower margin parts sales in the third quarter of 2011.&quot;  </P>
<P>&quot;Looking forward, we are optimistic about positive trends on both sides of the business,&quot; said Lupinetti. &quot;At our Systems segment, we are pleased that 10 E2D aircraft have received budget approval as part of phases 3 and 4 of the Low Rate Initial Production Phase, and we expect to benefit from the production of these aircraft beginning in 2012. At our Service and Systems Integration segment, we are making progress on our strategy to attract higher-margin consulting, as well as solutions and managed services business.  As we begin to look toward fiscal 2012, we are bullish about our long-term growth prospects as we are poised to capitalize on exciting trends on both the Systems and Service and Systems Integration segments.&quot;</P>
<FONT FACE="Courier">
<P>&nbsp;</P>
</FONT><P>Conference Call Details</P>
<P>CSP Chairman and Chief Executive Officer Alexander R. Lupinetti, and Chief Financial Officer Gary W. Levine will host a conference call at 10:00 a.m. (ET) today to review CSP's financial results and provide a business update.  To listen to a live webcast of the call, please visit the &quot;Investor Relations&quot; section of the Company's website at www.cspi.com.  Individuals may also listen to the call via telephone, by dialing (877) 709-8155 or (201) 689-8881.  For interested parties unable to participate in the live call, an archived version of the webcast will be available for approximately one year on CSP's website.  </P>

<P>&nbsp;</P>
<P>About CSP Inc.</P>

<P>Based in Billerica, Massachusetts and founded in 1968, CSP Inc. and its subsidiaries develop and market best-of-breed IT solutions, systems integration services, and high-performance computer systems.  CSP's Systems segment includes the MultiComputer Division, which supplies high-performance Linux cluster systems for a broad array of defense applications, including radar, sonar and surveillance signal processing.  The Company's MODCOMP Inc. subsidiary, also part of its Service and Systems Integration segment founded in 1970, is a leading provider of IT solutions and systems integration services for complex IT environments.  MODCOMP works with third parties to develop cutting edge solutions in the global IT markets and has offices in the U.S., U.K. and Germany.  More information about CSP is available on the company's website at www.cspi.com .  To learn more about MODCOMP, Inc., consult www.modcomp.com.</P>

<P>&nbsp;</P>
<P>Safe Harbor </P>
<P>The Company wishes to take advantage of the &quot;Safe Harbor&quot; provisions of the Private Securities Litigation Reform Act of 1995 with respect to statements that may be deemed to be forward-looking under the Act.  Such forward-looking statements may include, but are not limited to, those relating to expectations regarding the build plans for the E2D aircraft, CSP's ability to attract higher-margin consulting, as well as solutions and managed services business, the Company's optimism regarding its long-term growth prospects and its ability to capitalize on exciting trends on both the Systems and Service and Systems Integration segments.  The Company cautions that numerous factors could cause actual results to differ materially from forward-looking statements made by the Company.  Such risks include general economic conditions, market factors, competitive factors and pricing pressures, and others described in the Company's filings with the SEC.  Please refer to the section on forward-looking statements included in the Company's filings with the Securities and Exchange Commission.</P>
<B><FONT FACE="Courier"><P ALIGN="CENTER"></P>
</B><P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P ALIGN="CENTER">&nbsp;</P>
<P ALIGN="CENTER">&nbsp;</P>
</FONT><FONT SIZE=2><P ALIGN="CENTER">CSP INC. AND SUBSIDIARIES<BR>
UNAUDITED CONSOLIDATED BALANCE SHEETS<BR>
(Amounts in thousands)</P></B></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=690 DIR="LTR">
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">June 30,</B></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">September 30,</B></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2011</B></U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2010</B></U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="JUSTIFY">Assets&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Current assets:</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;Cash and short-term investments</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$17,482</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$15,531</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;Accounts receivable, net</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">10,318</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">12,190</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;Inventories</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">5,586</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">5,862</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;Other current assets</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    2,514</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    2,368</U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total current assets</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">35,900</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">35,951</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Property, equipment and improvements, net</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">873</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">873</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Other assets</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    4,657</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    4,555</U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Total assets</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">$41,430</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">$41,379</U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Liabilities and Shareholders' Equity</B></FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>  Current liabilities </FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">    $13,273</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">    $13,948</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Pension and retirement plans</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">9,010</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">8,928</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Non-current liabilities</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">296</FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">24</FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Shareholders' equity</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  18,851</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  18,479</U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Total liabilities and shareholders' equity</FONT></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">$41,430</U></FONT></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">$41,379</U></FONT></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="66%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="18%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="16%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
</TABLE>

<B><FONT SIZE=2>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
</B><P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
</B><P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<B><P>&nbsp;</P>
<P ALIGN="CENTER">CSP INC. AND SUBSIDIARIES<BR>
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS<BR>
(Amounts in thousands, except per share data)<BR>
</P>
</B><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;                        <B>/---Three Months Ended---/      /---Nine Months Ended---/</P></B></FONT>
<TABLE CELLSPACING=0 BORDER=0 CELLPADDING=7 WIDTH=822 DIR="LTR">
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">Jun. 31,</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">Jun. 31,</B></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">Jun. 31,</B></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P ALIGN="CENTER">Jun. 31,</B></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2011</B></U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2010</B></U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2011</B></U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<B><U><FONT SIZE=2><P ALIGN="CENTER">2010</B></U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Sales:</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Product</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$16,416</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$23,753</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$49,566</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">$59,549</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Service</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   3,265</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   4,815</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  11,434</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  11,601</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total sales</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">19,681</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">28,568</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">61,000</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">71,150</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Cost of Sales:</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Product</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">13,690</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">21,153</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">41,440</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">50,729</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Service</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  2,370</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  2,519</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  7,162</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  7,731</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total cost of sales</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">  16,060</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">23,672</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">  48,602</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">58,460</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp; Gross profit</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">3,621</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">4,896</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">12,398</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">12,690</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Operating expenses:</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Engineering and development</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">442</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">498</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,460</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,401</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;Selling, general &amp; administrative</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,450</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> 3,740</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> 10,135</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">10,207</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total operating expenses</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,892</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> 4,238</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> 11,595</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">11,608</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Operating income (loss) </B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(271)</P>
<P ALIGN="RIGHT"></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">658</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">803</P>
<P ALIGN="RIGHT"></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,082</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Other income (loss), net</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   (33)</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   (10)</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    (55)</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   (46)</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Income (loss) before income taxes</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">(304)</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">648</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">748</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P ALIGN="RIGHT">1,036</FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>  Provision (benefit) for income taxes  </FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   (90)</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">     27</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   287</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    168</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Net income (loss)</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> ($214)</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">     $621</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   $461</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   $868</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<B><FONT SIZE=2><P>Net income(loss) attributable to common stockholders</B></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT"> ($211) </U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">     $614</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   $455 </U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   $860</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Income (loss) per share - basic</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">($0.06)</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    $0.17</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  $0.13</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    $0.24</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Weighted average shares outstanding - basic</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,428</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    3,548</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,446</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    3,545</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Income (loss) per share - diluted</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">($0.06)</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">    $0.17</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  $0.13</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   $0.24</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
<TR><TD WIDTH="39%" VALIGN="TOP" HEIGHT=17>
<FONT SIZE=2><P>Weighted average shares outstanding - diluted</FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,475</U></FONT></TD>
<TD WIDTH="10%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,574</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">  3,485</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17>
<U><FONT SIZE=2><P ALIGN="RIGHT">   3,574</U></FONT></TD>
<TD WIDTH="9%" VALIGN="TOP" HEIGHT=17><P></P></TD>
<TD WIDTH="12%" VALIGN="TOP" HEIGHT=17><P></P></TD>
</TR>
</TABLE>

<B><FONT SIZE=3>
</B></FONT><FONT FACE="Courier"><P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
<P>&nbsp;</P>
</FONT><P>&nbsp;</P></BODY>
</HTML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
