SUBSCRIBE TO TMCnet
TMCnet - World's Largest Communications and Technology Community

TMCNet:  CUBIC CORP /DE/ - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

[December 14, 2012]

CUBIC CORP /DE/ - 10-Q - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL

(Edgar Glimpses Via Acquire Media NewsEdge) CONDITION AND RESULTS OF OPERATIONS June 30, 2012 Our three primary businesses are in the defense and transportation industries.

These are high technology businesses that design, manufacture and integrate complex systems and provide essential services to meet the needs of various federal and regional government agencies in the U.S. and other nations around the world.


Cubic Transportation Systems (CTS) is the leading delivery, integration and IT service provider of automated fare collection systems and turnkey services for public transit authorities worldwide. We provide hardware, software and multiagency, multimodal transportation integration technologies and a full scope of operational services that allow the agencies to efficiently collect fares, manage their operations, reduce shrinkage and make using public transit a more convenient and attractive option for commuters.

Cubic Defense Systems (CDS) is focused on two primary lines of business: Training Systems and Communications. The segment is a diversified supplier of live and virtual military training systems, and communication systems and products to the U.S. Department of Defense, other government agencies and allied nations. We design instrumented range systems for fighter aircraft, armored vehicles and infantry force-on-force live training; weapons effects simulations; laser-based tactical and communication systems; and precision gunnery solutions.

Our virtual training systems are aimed at marksmanship, armored vehicle, and tactical missile systems. Our communications products are aimed at intelligence, surveillance, and search and rescue markets. Other product lines include multi-band communication tracking devices, and cross domain hardware solutions to address multi-level security requirements.

Mission Support Services (MSS) is a leading provider of highly specialized support services including live, virtual, and constructive training; real-world mission rehearsal exercises; professional military education; information technology, information assurance and related cyber support; development of military doctrine; consequence management, infrastructure protection, and force protection; risk mitigation services, and subject matter and operational expertise for national agency and homeland security clients; as well as support to field operations, force deployment and redeployment, and logistics.

Consolidated Overview Sales for the quarter ended June 30, 2012 increased 13% to $365.4 million from $322.8 million last year. For the first nine months of the fiscal year, sales increased to $1.022 billion compared to $952.6 million last year, an increase of 7%. Sales from CTS increased13% for the quarter and 24% for the nine-month period. CDS sales decreased 1% for the nine-month period but were up by 37% for the quarter. MSS sales decreased slightly for the quarter and the nine-month period. The acquisition of Abraxas added $56.6 million to MSS sales for the nine-month period compared to $30.5 million last year. See the segment discussions following for further analysis of segment sales.

Operating income was $38.6 million in the quarter compared to $27.8 million in the third quarter of last year, an increase of 39%. For the quarter, operating income increased primarily due to a due to a favorable change in estimate on a CDS ground combat training range contract during the quarter. Operating income from CTS increased for the quarter, but decreased from the MSS segment.

Unallocated corporate and other expenses for the third quarter were $1.1 million in 2012 compared to $1.3 million in 2011.

Operating income for the nine-month period increased 5% to $98.9 million from $93.8 million last year. Operating income increased from CTS and CDS, but decreased from MSS for the first nine months. Unallocated corporate and other expenses for the first nine months of the fiscal year were $3.3 million for 2012 and $4.8 million for 2011. The 2011 unallocated corporate and other expenses include costs of $1.0 million for which we have filed an insurance claim.

However, any potential recovery is treated as a contingent gain and not recorded until we are assured of receiving the insurance proceeds. See the segment discussions following for further analysis of segment operating income.

18 -------------------------------------------------------------------------------- Net income attributable to Cubic for the third quarter of fiscal 2012 increased to $26.7 million, or $1.00 per share, compared to $22.1 million, or 82 cents per share last year. For the first nine months of the year, net income increased to $70.8 million, or $2.65 per share, from $69.0 million, or $2.58 per share last year. Net income increased for the quarter and first nine months primarily due to the increase in operating income. Other income (expense) included a net foreign currency exchange gain of $0.9 million for the first nine months of the year compared to a loss of $0.8 million last year, before applicable income taxes. The impact of the increases in operating income and other income on net income were partially offset by the increase in income tax expense described below.

Our gross margin percentage on product sales increased to 32% in the first nine months of fiscal 2012 compared to 31% in 2011. The increase in our gross margin percentage on product sales is primarily due to a favorable change in estimate on a contract in the CDS segment in the third quarter of 2012. Our gross margin percentage on service sales decreased to 18% in the nine-month period ended June 30, 2012 compared to 20% in 2011 due primarily to lower profit margins in the MSS segment.

Selling, general and administrative (SG&A) expenses increased in the third quarter this year to $42.8 million compared to $38.0 million last year. For the nine-month period, SG&A increased to $121.0 million compared to $114.6 million last year. Increases in SG&A reflected general growth of the business and a $2.9 million provision made for a legal claim in the transportation segment during the second quarter of this year. As a percentage of sales, SG&A expenses were 12% for the third quarter and nine-month period in both years. Company funded research and development expenditures, which relate to new transportation and defense technologies we are developing, increased to $8.4 million for the third quarter compared to $6.3 million last year and $21.4 million for the nine-month period this year compared to $17.8 million last year. Amortization of purchased intangibles increased for the nine-month period this year to $11.4 million compared to $10.6 million last year due to the acquisition of Abraxas in December 2010.

As of June 30, 2012, our projected effective tax rate for fiscal 2012 is 29.6% and is reflected in the tax provision for the nine months ended June 30, 2012.

The projected effective rate for fiscal 2012 is higher than last year's effective rate of 27.8% primarily due to the expiration of the U.S. federal research and development (R&D) credit on December 31, 2011. In addition, our projected effective income tax rate for the first half of 2011 benefitted from the retroactive reinstatement of the federal R&D credit, which reduced the tax provision by $1.4 million in that period. The effective rate for fiscal 2012 could be affected by, among other factors, the mix of business between the U.S.

and foreign jurisdictions, our ability to take advantage of available tax credits and audits of our records by taxing authorities.

Transportation Systems Segment (CTS) Nine Months Ended Three Months Ended June 30, June 30, 2012 2011 2012 2011 (in millions) (As Restated) (As Restated) Transportation Systems Segment Sales $ 383.3 $ 309.6 $ 125.8 $ 111.1 Transportation Systems Segment Operating Income $ 60.5 $ 57.7 $ 19.2 $ 17.1 19 -------------------------------------------------------------------------------- CTS sales increased 13% in the third quarter to $125.8 million compared to $111.1 million last year, and increased 24% for the nine-month period to $383.3 million from $309.6 million last year. Sales for the quarter and the nine-month period ended June 30, 2012 were higher from work on contracts in Australia, a contract in Canada, and our contracts in the U.K. Partially offsetting these increases were lower sales from design and build projects in the U.S. compared to the third quarter and nine-month period last year. The average exchange rates between the prevailing currency in our foreign operations and the U.S. dollar resulted in a decrease in sales of $3.3 million for the third quarter and a decrease of $1.7 million for the nine-month period, compared to the same periods last year.

Operating income from CTS increased 12% in the third quarter to $19.2 million compared to $17.1 million last year, and increased 5% for the nine-month period to $60.5 million from $57.7 million last year. Higher sales and operating income from contracts in Canada and the U.K., in addition to improved margins from a service contract in the U.S. contributed toward the increases for the quarter and nine-month periods. The nine month results were impacted by a $2.9 million provision we recorded in the second quarter related to a claim against us, for which we are seeking insurance reimbursement. Any potential insurance recovery is treated as a contingent gain until we are assured of receiving the insurance proceeds. In addition, operating income for the three and nine-month periods in 2012 was impacted by cost growth on contracts in the U.S. and Europe that reduced operating income by $2.0 million for the third quarter and $4.8 million for the nine-month period. We have also increased our research and development expenditures in 2012 to $6.8 million for the first nine months compared to $2.9 million for the first nine months of last year. The average exchange rates between the prevailing currency in our foreign operations and the U.S. dollar reduced operating income by $0.5 million for the quarter and $0.7 million for the nine-month period, compared to the same periods last year.

Defense Systems Segment (CDS) Nine Months Ended Three Months Ended June 30, June 30, 2012 2011 2012 2011 (in millions) (As Restated) (As Restated) Defense Systems Segment Sales Training systems $ 241.8 $ 248.7 $ 106.8 $ 75.8 Communications 31.7 28.7 8.4 6.7 Other 7.4 6.8 1.7 3.1 $ 280.9 $ 284.2 $ 116.9 $ 85.6 Defense Systems Segment Operating Income Training systems $ 32.1 $ 31.4 $ 18.9 $ 7.2 Communications 0.8 3.9 (2.7 ) 2.0 Other (6.2 ) (12.6 ) (1.6 ) (5.2 ) $ 26.7 $ 22.7 $ 14.6 $ 4.0 Training Systems Training systems sales increased 41% in the third quarter this year to $106.8 million compared to $75.8 million last year, and decreased 3% for the nine-month period to $241.8 million compared to $248.7 million last year. Operating income more than doubled for the quarter from $7.2 million last year to $18.9 million this year, and was up by 2% for the nine-month period from $31.4 million last year to $32.1 million this year. Sales were higher for the quarter from two ground combat training ranges we are building in Europe and from sales of small arms training systems. The increase in operating income resulted from a change in estimate during the quarter related to a ground combat training range contract in Europe. We had been working for more than a year under an arrangement without a firm contract price or scope of work and had been recognizing sales equal to costs. We have now reached agreement with the customer on a price and scope of work, resulting in higher operating income in the third quarter because of this favorable change in estimate. Sales were lower for the quarter and nine-month periods from air combat training systems. A delivery of air combat training systems to a U.S. government customer last year had resulted in significant sales and operating income for the nine-month period. Ground combat training sales and operating income in the U.S. and the Far East were also lower this year for the nine-month period, but increased in the third quarter.

20 -------------------------------------------------------------------------------- Communications Communications sales increased 25% in the third quarter of 2012 to $8.4 million compared to $6.7 million in 2011 and increased 10% for the nine-month period to $31.7 million from $28.7 million in the comparable period in 2011. Higher sales for both the quarter and nine-month period came from data links, while power amplifier sales were higher for the nine-month period but lower for the quarter.

Personnel locater systems were lower for both the quarter and nine-month period.

Cost growth of $3.1 million on two data links contracts resulted in an operating loss for the third quarter of $2.7 million compared to operating income of $2.0 million in 2011. Operating income was also lower for the quarter on lower sales of personnel locater systems and power amplifiers. Operating income for the first nine months of the fiscal year decreased 79% to $0.8 million this year from $3.9 million last year, primarily as a result of the cost growth in the third quarter mentioned above. Lower sales of personnel locator systems also contributed to lower operating income from communications for the nine-month period.

Other The "Other" category of the defense systems segment includes businesses that are developing cross domain and global asset tracking products. In the first nine months of 2012 we continued to invest in the development and marketing of these products, resulting in an operating loss for the quarter and nine-month period.

However, increased gross margins on sales of these products reduced the operating losses for the third quarter and nine-month period compared to 2011.

Mission Support Services Segment (MSS) Nine Months Ended Three Months Ended June 30, June 30, 2012 2011 2012 2011 (in millions) (As Restated) (As Restated) Mission Support Services Segment Sales $ 356.8 $ 357.8 $ 122.4 $ 125.9 Mission Support Services Segment Operating Income $ 15.0 $ 18.2 $ 5.9 $ 8.0 Sales from MSS decreased 3% to $122.4 million in the third quarter of 2012, from $125.9 million in 2011, and decreased slightly for the nine-month period to $356.8 million from $357.8 million last year. Results for the nine-month period included sales contributed by Abraxas, acquired in December 2010, amounting to $56.6 million for the nine-month period compared to $30.5 million last year.

Abraxas sales for the third quarter of 2012 were $5.4 million higher than in 2011. Sales decreased for the quarter and nine-month period from training and education contracts due to the migration of certain contracts to small businesses where we are now in a subcontractor role. In addition, earlier in the year we lost a contract in a competitive bid situation, for support of simulation trainers that we had performed for several years.

MSS operating income decreased 26% to $5.9 million in the third quarter this year from $8.0 million last year, and decreased 18% for the nine-month period to $15.0 million this year compared to $18.2 million last year. Lower sales from certain higher margin training and education contracts contributed to the decrease in operating income for the quarter and nine-month period this year.

In addition, the current competitive environment in the government services industry is driving profit margins lower than in recent years. Abraxas incurred an operating loss of $0.3 million for the third quarter of 2012 which is the same as in 2011. Abraxas' operating loss for the nine-month period ended June 30, 2012 decreased to $1.7 million from $1.8 million last year.

21 -------------------------------------------------------------------------------- Abraxas' operating results included $2.2 million of amortization of intangible assets for the third quarter of this year compared to $2.6 million last year.

Abraxas recorded $7.1 million of amortization for the nine-month period ended June 30, 2012 while amortization and acquisition-related costs were $5.5 million and $0.7 million, respectively, in the comparable period last year.

Backlog June 30, September 30, 2012 2011 (in millions) (As Restated) Total backlog Transportation Systems $ 1,692.4 $ 1,321.4 Mission Support Services 845.2 931.5 Defense Systems: Training systems 400.2 481.5 Communications 29.7 36.0 Other 5.7 9.7 Total Defense Systems 435.6 527.2 Other Operations 0.7 1.3 Total $ 2,973.9 $ 2,781.4 Funded backlog Transportation Systems $ 1,692.4 $ 1,321.4 Mission Support Services 308.3 258.1 Defense Systems: Training systems 400.2 481.5 Communications 29.7 36.0 Other 5.7 9.7 Total Defense Systems 435.6 527.2 Other Operations 0.7 1.3 Total $ 2,437.0 $ 2,108.0 As reflected in the table above, total backlog increased $192.5 million and funded backlog increased $329.0 million from September 30, 2011 to June 30, 2012. The majority of the backlog increase was from a new transportation contract awarded in Chicago, which added $454 million. Changes in exchange rates between the prevailing currency in our foreign operations and the U.S. dollar as of June 30, 2012 increased backlog by approximately $32.1 million compared to September 30, 2011.

The difference between total backlog and funded backlog represents options under multiyear service contracts. Funding for these contracts comes from annual operating budgets of the U.S. government and the options are normally exercised annually. Options for the purchase of additional systems or equipment are not included in backlog until exercised. In addition to the amounts identified above, we have been selected as a participant in or, in some cases, the sole contractor for several substantial indefinite delivery/ indefinite quantity (IDIQ) contracts. IDIQ contracts are not included in backlog until an order is received. We also have several service contracts in our transportation business that include contingent revenue provisions tied to meeting certain performance criteria. These variable revenues are also not included in the amounts identified above.

22 --------------------------------------------------------------------------------Liquidity and Capital Resources Operating activities used cash of $38.8 million for the nine-month period.

Increases in accounts receivable, inventories, and long-term capitalized contract costs, and decreases in other current liabilities and customer advances contributed to the use of cash. Use of cash by our CTS and CDA segments was partially offset by positive cash flows from our MSS segment. A significant portion of the cash used was in the transportation segment for expenditures related to large contracts in Australia, Canada, and the U.S., where we must meet certain milestones before being paid by the customer.

Investing activities for the nine-month period included capital expenditures of $13.2 million and proceeds from maturities of marketable securities of $25.8 million. Financing activities for the nine-month period consisted of scheduled payments on our long-term debt of $4.4 million, dividends paid to our shareholders of $3.2 million and the transfer of cash into a restricted account totaling $68.6 million, as described below.

We have a committed five-year revolving credit agreement with a group of financial institutions in the amount of $200 million, expiring in May 2017.

Commitment fees associated with this financing arrangement are 0.20% of the unutilized balance per annum. As of June 30, 2012, there were no borrowings under this agreement; however, there were letters of credit outstanding under the agreement totaling $26.8 million, which reduce the available line of credit to $173.2 million.

On January 12, 2012 we entered into an additional secured letter of credit facility agreement with a bank which supports our issuance of letters of credit that guarantee our obligations to perform under contracts in all of our operating segments. At June 30, 2012 there were letters of credit outstanding under this agreement of $57.7 million. In support of the facility, we placed $68.7 million of our cash held in the U.K. on deposit as collateral in a restricted account with the bank providing the facility. We are required to leave the cash in the restricted account so long as the bank continues to maintain associated letters of credit under the facility. In return the bank will reduce associated letter of credit fees, accommodate extended expiration dates for the underlying letters of credit and pay an interest rate approximating the three month LIBOR on the deposit. This interest rate provides an improvement over the rate earned on our previous investment choices. The maximum amount of letters of credit currently allowed by the facility is $66.7 million, and any increase above this amount would require bank approval and additional restricted funds to be placed on deposit. The initial term of the facility is one year; however we may choose at any time to terminate the facility, pending the payment of certain breakage fees, and move the associated letters of credit to another credit facility.

As of June, 2012, $210.1 million of the $231.1 million of our cash, cash equivalents, and short-term investments was held by our foreign subsidiaries.

Also, all of our restricted cash was held by our subsidiary in the U.K. If any of the funds held by our foreign subsidiaries are needed for our operations in the U.S., we would be required to accrue and pay U.S. taxes to repatriate these funds. However, our intent is to permanently reinvest these funds outside of the U.S. and our current plans do not demonstrate a need to repatriate them to fund our U.S. operations.

Our financial condition remains strong with working capital of $423.3 million and a current ratio of 2.5 to 1 at June 30, 2012. We expect that cash on hand, cash flows from operations, and our unused lines of credit will be adequate to meet our liquidity requirements for the foreseeable future.

Critical Accounting Policies, Estimates and Judgments Our financial statements are prepared in accordance with accounting principles that are generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets 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 reporting period. We continually evaluate our estimates and judgments, the most critical of which are those related to revenue recognition, income taxes, valuation of goodwill, purchased intangibles and pension costs. We base our estimates and judgments on historical experience and other factors that we believe to be reasonable under the circumstances. Materially different results can occur as circumstances change and additional information becomes known.

23 -------------------------------------------------------------------------------- Besides the estimates identified above that are considered critical, we make many other accounting estimates in preparing our financial statements and related disclosures. All estimates, whether or not deemed critical affect reported amounts of assets, liabilities, revenues and expenses, as well as disclosures of contingent assets and liabilities. These estimates and judgments are also based on historical experience and other factors that are believed to be reasonable under the circumstances. Materially different results can occur as circumstances change and additional information becomes known, even for estimates and judgments that are not deemed critical.

In connection with the restatement of our consolidated financial statements described in Note 2 of Part 1 Item 1, we revised our critical accounting policy for revenue recognition as follows: Revenue Recognition A significant portion of our business is derived from long-term development, production and system integration contracts. We consider the nature of these contracts, and the types of products and services provided, when we determine the proper accounting for a particular contract. Generally, we record revenue for long-term fixed price contracts on a percentage-of-completion basis using the cost-to-cost method to measure progress toward completion. Many of our long-term fixed-price contracts require us to deliver quantities of products over a long period of time or to perform a substantial level of development effort in relation to the total value of the contract. Under the cost-to-cost method of accounting, we recognize revenue based on a ratio of the costs incurred to the estimated total costs at completion. For certain other long-term, fixed price production contracts not requiring substantial development effort we use the units-of-delivery percentage-of-completion method as the basis to measure progress toward completing the contract and recognizing sales. The units-of-delivery measure recognizes revenues as deliveries are made to the customer generally using unit sales values in accordance with the contract terms. We estimate profit as the difference between total estimated revenue and total estimated cost of a contract and recognize that profit over the life of the contract based on deliveries.

As a general rule, we recognize sales and profits earlier in a production cycle when we use the cost-to-cost method of percentage-of-completion accounting than when we use the units-of-delivery method. In addition, our profits and margins may vary materially depending on the types of long-term contracts undertaken, the costs incurred in their performance, the achievement of other performance objectives, and the stage of performance at which the right to receive fees, particularly under award and incentive fee contracts, is finally determined.

Award fees and incentives related to performance on contracts, which are generally awarded at the discretion of the customer, as well as penalties related to contract performance, are considered in estimating sales and profit rates. Estimates of award fees are based on actual awards and anticipated performance. Incentive provisions that increase or decrease earnings based solely on a single significant event are generally not recognized until the event occurs. Those incentives and penalties are recorded when there is sufficient information for us to assess anticipated performance.

Accounting for long-term contracts requires judgment relative to assessing risks, estimating contract revenues and costs, and making assumptions for schedule and technical issues. Due to the scope and nature of the work required to be performed on many of our contracts, the estimation of total revenue and cost at completion is complicated and subject to many variables. Contract costs include material, labor, and subcontracting costs, as well as an allocation of indirect costs. For contracts with the U.S. federal government, general and administrative costs are considered contract costs; however, general and administrative costs are not considered contract costs for any other customers.

We have to make assumptions regarding labor productivity and availability, the complexity of the work to be performed, the availability of materials, estimated increases in wages and prices for materials, performance by our subcontractors, and the availability and timing of funding from our customer, among other variables. For contract change orders, claims, or similar items, we apply judgment in estimating the amounts and assessing the potential for realization.

These amounts are only included in contract value when they can be reliably estimated and realization is considered probable. We have accounting policies and controls in place to address these, as well as other contractual and business arrangements to properly account for long-term contracts, and we continue to monitor and improve such policies, controls, and arrangements.

24 -------------------------------------------------------------------------------- Products and services provided under long-term, fixed-price contracts represented the majority of our net sales for the nine months ended June 30, 2012. Because of the significance of the judgments and estimation processes, it is likely that materially different amounts could be recorded if we used different assumptions or if our underlying circumstances were to change. When adjustments in estimated contract revenues or estimated costs at completion are required, any changes from prior estimates are recognized by recording adjustments in the current period for the inception-to-date effect of the changes on current and prior periods using the cumulative catch-up method of accounting. When estimates of total costs to be incurred on a contract exceed total estimates of revenue to be earned, a provision for the entire loss on the contract is recorded in the period the loss is determined.

We occasionally enter into contracts that include multiple deliverables such as the construction or upgrade of a system and subsequent services related to the delivered system. Recently we have seen an increase in the number of customer requests for proposal that include this type of contractual arrangement. An example of this is a contract we entered into in 2011 to provide system upgrades and long-term services for the Vancouver, B.C. Canada Smart Card and Faregate system. We elected to adopt updated authoritative accounting guidance for multiple-element arrangements in 2010 on a prospective basis. For contracts of this nature entered into in 2010 and beyond, the contract value is allocated at the inception of the contract to the different contract elements based on their relative selling price. The relative selling price for each deliverable is determined using vendor specific objective evidence (VSOE) of selling price or third-party evidence of selling price if VSOE does not exist. If neither VSOE nor third-party evidence exists, which is typically the case for our contracts, we use our best estimate of the selling price for each deliverable. Once the contract value is allocated to the separate deliverables, revenue recognition guidance relevant to each contractual element is followed. For example, for the long-term construction portion of a contract we use the cost-to-cost percentage-of-completion method and for the services portion we recognize the service revenues on a straight-line basis over the contractual service period or based on measurable units of work performed or incentives earned. The judgment we apply in allocating the relative selling price to each deliverable can have a significant impact on the timing of recognizing revenues and operating income on a contract.

We provide services under contracts including outsourcing-type arrangements and operations and maintenance contracts. Revenue under our service contracts with the U. S. government, which is generally in our MSS segment, is recorded under the cost-to-cost percentage-of-completion method. Award fees and incentives related to performance on services contracts at MSS are generally accrued during the performance of the contract based on our historical experience with such awards.

Revenue under contracts for services other than those with the U.S. government and those associated with design, development, production, or maintenance activities is recognized either as services are performed or when a contractually required event has occurred, depending on the contract. These types of service contracts are entered primarily by our CTS segment and to a lesser extent by our CDS segment. Revenue under such contracts is generally recognized on a straight-line basis over the period of contract performance, unless evidence suggests that the revenue is earned or the obligations are fulfilled in a different pattern. Costs incurred under these services contracts are expensed as incurred. Earnings related to services contracts may fluctuate from period to period, particularly in the earlier phases of the contract.

Incentive fees included in some of our transportation systems service contracts are recognized when they become fixed and determinable based on the provisions of the contract. Often these fees are based on meeting certain contractually required service levels or based on system usage levels.

More than half of our total sales are driven by pricing based on costs incurred to produce products or perform services under contracts with the U.S.

government. Cost-based pricing is determined under the Federal Acquisition Regulation (FAR). The FAR provides guidance on the types of costs that are allowable in establishing prices for goods and services under U.S. government contracts. For example, costs such as those related to charitable contributions, interest expense, and certain advertising activities are unallowable, and therefore not recoverable through sales.

25 --------------------------------------------------------------------------------For further information, refer to the consolidated financial statements and notes thereto included in our annual report on Form 10-K for the year ended September 30, 2011.

[ Back To Technology News's Homepage ]

OTHER NEWS PROVIDERS







Technology Marketing Corporation

800 Connecticut Ave, 1st Floor East, Norwalk, CT 06854 USA
Ph: 800-243-6002, 203-852-6800
Fx: 203-866-3326

General comments: tmc@tmcnet.com.
Comments about this site: webmaster@tmcnet.com.

STAY CURRENT YOUR WAY

© 2014 Technology Marketing Corporation. All rights reserved.