NVE Corporation Reports First Quarter Fiscal 2007 Results Product sales increase 71%; net income more than doubles



    EDEN PRAIRIE, Minn., July 19 /PRNewswire-FirstCall/ -- NVE Corporation
 (Nasdaq:   NVEC) today announced financial results for the quarter ended June
 30, 2006.
     Product sales for the quarter increased 71% over the prior-year quarter
 to $3.05 million from $1.78 million. Total revenue, which consisted of
 product sales and contract research and development revenue, increased 20%
 to $3.64 million for the first quarter of fiscal 2007 from $3.03 million
 for the prior-year quarter. Net income for the quarter was $891,806 or
 $0.19 per diluted share, compared to $412,649 or $0.09 per diluted share
 for the prior-year quarter. Net income for the quarter ended June 30, 2006
 included the effect of $2,569 in non-cash stock-based compensation due to
 the implementation of SFAS 123(R). Net income for the first quarter of
 fiscal 2007 also included a $473,241 non-cash provision for income taxes
 compared to $240,468 for the prior-year quarter.
     "We are pleased to report another quarter of record product sales and
 profits," said NVE President and Chief Executive Officer Daniel A. Baker,
 Ph.D. "Gross profit margin increased to 61% and operating margin to 36%.
 Cash plus investments increased by $897,880 during the quarter, and we
 retired all of our debt."
     NVE is a leader in the practical commercialization of spintronics, a
 nanotechnology that many experts believe represents the next generation of
 microelectronics. NVE licenses its MRAM intellectual property and sells
 spintronic sensors and couplers to revolutionize data sensing and
 transmission.
     Statements used in this press release that relate to future plans,
 events, financial results or performance are forward-looking statements
 that are subject to certain risks and uncertainties including, among
 others, such factors as risks in continued profitability, risks associated
 with our reliance on several large customers, as well as the risk factors
 listed from time to time in our filings with the SEC, including our Annual
 Report on Form 10-K and other reports filed with the SEC.
                                  NVE CORPORATION
                               STATEMENTS OF INCOME
                 QUARTERS ENDED JUNE 30, 2006 AND 2005 (Unaudited)
 
                                                     Quarter Ended June 30
                                                    2006              2005
     Revenue
        Product sales                            $3,053,328        $1,784,250
        Contract research and development           581,867         1,241,298
     Total revenue                                3,635,195         3,025,548
     Cost of sales                                1,399,821         1,681,118
     Gross profit                                 2,235,374         1,344,430
     Expenses
        Research and development                    530,612           376,800
        Selling, general, and administrative        406,732           409,594
     Total expenses                                 937,344           786,394
     Income from operations                       1,298,030           558,036
     Interest income                                111,906            68,319
     Interest expense                                  (589)           (2,053)
     Other income                                       -              30,815
     Income before taxes                          1,409,347           655,117
     Provision for income taxes                     517,541           242,468
     Net income                                    $891,806          $412,649
     Net income per share - basic                     $0.19             $0.09
     Net income per share - diluted                   $0.19             $0.09
     Weighted average shares outstanding
        Basic                                     4,616,588         4,569,861
        Diluted                                   4,693,075         4,683,151
     Supplemental financial data
        Non-cash stock-based compensation            $2,569              $-
        Non-cash income tax expense                $473,241          $240,468
 
 
 
                                  NVE CORPORATION
                                  BALANCE SHEETS
                         JUNE 30, 2006 AND MARCH 31, 2006
 
                                                (Unaudited)
                                              June 30, 2006     March 31, 2006
     ASSETS
     Current assets
        Cash and cash equivalents                $1,737,112        $1,288,362
        Short-term investments                      749,295         1,248,103
        Accounts receivable, net of
         allowance for uncollectible
         accounts of $15,000                      1,919,778         1,667,029
        Inventories                               2,103,995         2,149,769
        Deferred tax assets                       1,593,096         1,576,472
        Prepaid expenses and other assets           257,056           231,412
     Total current assets                         8,360,332         8,161,147
     Fixed assets
        Machinery and equipment                   4,206,334         4,149,080
        Leasehold improvements                      413,482           413,482
                                                  4,619,816         4,562,562
        Less accumulated depreciation             3,443,755         3,319,651
     Net fixed assets                             1,176,061         1,242,911
     Long-term investments                        9,302,799         8,354,861
     Total assets                               $18,839,192       $17,758,919
 
     LIABILITIES AND SHAREHOLDERS' EQUITY
     Current liabilities
        Accounts payable                           $287,593          $399,762
        Accrued payroll and other                   431,779           470,392
        Deferred revenue                              4,863            77,373
        Capital lease obligations                       -              33,281
     Total current liabilities                      724,235           980,808
 
     Shareholders' equity
        Common stock                                 46,167            46,150
        Additional paid-in capital               16,519,930        16,042,637
        Accumulated other comprehensive loss       (199,178)         (166,908)
        Retained earnings                         1,748,038           856,232
     Total shareholders' equity                  18,114,957        16,778,111
     Total liabilities and shareholders'
      equity                                    $18,839,192       $17,758,919
 
 

SOURCE NVE Corporation

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