HORIZONTAL ANALYSIS(values in 000's) 12/31/2016

Total Revenue 27,638,000

Cost of Revenue 3,789,000
Gross Profit 23,849,000
OPERATING EXPENSES
Research and Development 5,919,000
Sales, General and Admin. 5,503,000
Operating Income 12,427,000
Add'l income/expense items 91
Earnings Before Interest and Tax 12,518,000
Income Tax 2,301,000
Minority Interest ($29,000)
Net Income 10,188,000

HORIZONTAL ANALYSIS(values in 000's) 12/31/2015

Total Revenue 17,928,000

Cost of Revenue 2,867,000
Gross Profit 15,061,000

OPERATING EXPENSES
Research and Development 4,816,000
Sales, General and Admin. 4,020,000
Operating Income 6,225,000
Add'l income/expense items 31
Earnings Before Interest and Tax 6,194,000
Income Tax 2,506,000
Minority Interest ($19,000)
Net Income 3,669,000

HORIZONTAL ANALYSIS(values in 000's) 12/31/2014

Total Revenue 12,466,000
Cost of Revenue 2,153,000
Gross Profit 10,313,000
OPERATING EXPENSES
Research and Development 2,666,000
Sales, General and Admin. 2,653,000
Operating Income 4,994,000
Add'l income/expense items 84
Earnings Before Interest and Tax 4,910,000
Income Tax 1,970,000
Minority Interest ($15,000)
Net Income 2,925,000
12/31/2015 Amount Percentages

17,928,000 9710000 54%

2,867,000 922000 32%
15,061,000 8788000 58%

4,816,000 1103000 23%

4,020,000 1483000 37%
6,225,000 6202000 100%
31 60000 194%
6,194,000 6324000 102%
2,506,000 -205000 8%
($19,000) 10000 53%
3,669,000 6519000 178%

12/31/2014 Amount Percentages

12,466,000 5462000 44%
2,153,000 714000 33%
10,313,000 4748000 46%

2,666,000 2150000 81%

2,653,000 1367000 52%
4,994,000 1231000 25%
84 -53000 -63%
4,910,000 1284000 26%
1,970,000 536000 27%
($15,000) 4000 27%
2,925,000 744000 25%

12/31/2013 Amount Percentages

7,872,000 4594000 58%
1,875,000 278000 15%
5,997,000 4316000 72%

1,415,000 1251000 88%

1,778,000 875000 49%
2,804,000 2190000 78%
50 34000 68%
2,754,000 2156000 78%
1,254,000 716000 57%
($9,000) 6000 67%
1,491,000 1434000 96%
VERTICAL ANALYSIS(values in 000's) 12/31/2016
CURRENT ASSETS
Cash and Cash Equivalents 8,903,000 14%
Short-Term Investments 20,546,000 32%
Net Receivables 3,993,000 6%
Inventory 0 0%
Other Current Assets 959 1%
LONG TERM ASSETS
Fixed Assets 8,591,000 13%
Goodwill 18,122,000 28%
Intangible Assets 2,535,000 4%
Other Assets 1,312,000 2%
Total Assets 64,961,000
CURRENT LIABILITIES
Accounts Payable 2,505,000 43%

Short-Term Debt / Current Portion of Long-

Term Debt
280 5%
Other Current Liabilities 90 2%
Long-Term Debt 0 0%

Other Liabilities 2,892,000 50%

Total Liabilities 5,767,000
STOCKHOLDER'S EQUITY
Capital Surplus 38,227,000 65%

Retained Earnings 21,670,000 37%

Other Equity ($703,000) 1%
Total Equity 59,194,000
Total Liabilities & Equity 64,961,000

HORIZONTAL ANALYSIS(values in 000's) 12/31/2016 12/31/2015

CURRENT ASSETS
Cash and Cash Equivalents 8,903,000 4,907,000
Short-Term Investments 20,546,000 13,527,000
Net Receivables 3,993,000 2,559,000
Inventory 0 0
Other Current Assets 959 659
LONG TERM ASSETS
Fixed Assets 8,591,000 5,687,000
Goodwill 18,122,000 18,026,000
Intangible Assets 2,535,000 3,246,000
Other Assets 1,312,000 796
Total Assets 64,961,000 49,407,000
CURRENT LIABILITIES
Accounts Payable 2,505,000 1,645,000
Short-Term Debt / Current Portion of Long-
Term Debt
280 224
Other Current Liabilities 90 56
Long-Term Debt 0 107
Other Liabilities 2,892,000 3,157,000
Total Liabilities 5,767,000 5,189,000
STOCKHOLDER'S EQUITY
Capital Surplus 38,227,000 34,886,000
Retained Earnings 21,670,000 9,787,000
Other Equity ($703,000) ($455,000)
Total Equity 59,194,000 44,218,000
Total Liabilities & Equity 64,961,000 49,407,000

HORIZONTAL ANALYSIS(values in 000's) 12/31/2015 12/31/2014

CURRENT ASSETS
Cash and Cash Equivalents 4,907,000 4,315,000
Short-Term Investments 13,527,000 6,884,000
Net Receivables 2,559,000 1,678,000
Inventory 0 0
Other Current Assets 659 513
LONG TERM ASSETS
Fixed Assets 5,687,000 3,967,000
Goodwill 18,026,000 17,981,000
Intangible Assets 3,246,000 3,929,000
Other Assets 796 699
Total Assets 49,407,000 39,966,000
CURRENT LIABILITIES
Accounts Payable 1,645,000 1,042,000

Short-Term Debt / Current Portion of Long-

Term Debt
224 316
Other Current Liabilities 56 66
Long-Term Debt 107 119
Other Liabilities 3,157,000 2,327,000
Total Liabilities 5,189,000 3,870,000
STOCKHOLDER'S EQUITY
Capital Surplus 34,886,000 30,225,000
Retained Earnings 9,787,000 6,099,000
Other Equity ($455,000) ($228,000)
Total Equity 44,218,000 36,096,000
Total Liabilities & Equity 49,407,000 39,966,000

HORIZONTAL ANALYSIS(values in 000's) 12/31/2014 12/31/2013

CURRENT ASSETS
Cash and Cash Equivalents 4,315,000 3,323,000
Short-Term Investments 6,884,000 8,126,000
Net Receivables 1,678,000 1,109,000
Inventory 0 0
Other Current Assets 513 512
LONG TERM ASSETS
Fixed Assets 3,967,000 2,882,000
Goodwill 17,981,000 839
Intangible Assets 3,929,000 883
Other Assets 699 221
Total Assets 39,966,000 17,895,000
CURRENT LIABILITIES
Accounts Payable 1,042,000 823

Short-Term Debt / Current Portion of Long-

Term Debt
316 239
Other Current Liabilities 66 38
Long-Term Debt 119 237
Other Liabilities 2,327,000 1,088,000
Total Liabilities 3,870,000 2,425,000
STOCKHOLDER'S EQUITY
Capital Surplus 30,225,000 12,297,000
Retained Earnings 6,099,000 3,159,000
Other Equity ($228,000) $14,000

Total Equity 36,096,000 15,470,000

Total Liabilities & Equity 39,966,000 17,895,000
12/31/2015 12/31/2014 12/31/2013

4,907,000 10% 4,315,000 11% 3,323,000 19%

13,527,000 27% 6,884,000 17% 8,126,000 45%
2,559,000 5% 1,678,000 4% 1,109,000 6%
0 0% 0 0% 0 0%
659 1% 513 1% 512 3%

5,687,000 12% 3,967,000 10% 2,882,000 16%

18,026,000 36% 17,981,000 45% 839 5%
3,246,000 7% 3,929,000 10% 883 5%
796 2% 699 2% 221 1%
49,407,000 39,966,000 17,895,000

1,645,000 32% 1,042,000 27% 823 34%

224 4% 316 8% 239 10%

56 0% 66 2% 38 2%
107 2% 119 3% 237 10%

3,157,000 61% 2,327,000 60% 1,088,000 45%

5,189,000 3,870,000 2,425,000

34,886,000 79% 30,225,000 0.8373503989 12,297,000 79%

9,787,000 22% 6,099,000 0.1689660904 3,159,000 20%
($455,000) 1% ($228,000) 0.0063164894 $14,000 0.1%
44,218,000 36,096,000 15,470,000
49,407,000 39,966,000 17,895,000

Amount Percentages

3996000 81%
7019000 52%
1434000 56%

300 46%

2904000 51%
96000 1%
-711000 -22%
516000 65%
15554000 31%

860000 52%
 56 25%
34 61%
-107 -100%
-265000 -8%
578000 11%

3341000 10%
11883000 121%
248000 55%
14976000 34%
15554000 31%

Amount Percentages

592000 14%
6643000 96%
881000 53%

146 28%

1720000 43%
45000 0%
-683000 -17%
97 14%
9441000 24%

603000 58%

-92 -29%
-10 -15%
-12 -10%
830000 36%
1319000 34%

4661000 15%
3688000 60%
227000 100%
8122000 23%
9441000 24%

Amount Percentages

992000 30%
-1242000 -15%
569000 51%
 1 0%

1085000 38%
17142000 2043%
3046000 345%
478 216%
22071000 123%

219000 27%

77 32%
28 74%
-118 -50%
1239000 114%
1445000 60%

17928000 146%
2940000 93%
214000 1529%
20626000 133%
22071000 55%
 12/31/2015
VERTICAL ANALYSIS(values in 000's) 12/31/2016
Total Revenue 27,638,000 100% 17,928,000
Cost of Revenue 3,789,000 14% 2,867,000
Gross Profit 23,849,000 86% 15,061,000
OPERATING EXPENSES
Research and Development 5,919,000 2% 4,816,000
Sales, General and Admin. 5,503,000 20% 4,020,000
Operating Income 12,427,000 45% 6,225,000
Add'l income/expense items 91 0% 31
Earnings Before Interest and Tax 12,518,000 45% 6,194,000
Income Tax 2,301,000 8% 2,506,000
Minority Interest ($29,000) 0% ($19,000)
Net Income 10,188,000 37% 3,669,000
 12/31/2014 12/31/2013
100% 12,466,000 100% 7,872,000 100%
16% 2,153,000 17% 1,875,000 24%
84% 10,313,000 83% 5,997,000 76%

27% 2,666,000 21% 1,415,000 18%

22% 2,653,000 21% 1,778,000 23%
35% 4,994,000 40% 2,804,000 36%
2% 84 1% 50 1%
35% 4,910,000 39% 2,754,000 35%
14% 1,970,000 16% 1,254,000 16%
0% ($15,000) 0% ($9,000) 0%
20% 2,925,000 23% 1,491,000 19%
 12/31/2016 12/31/2015 12/31/2014
LIQUIDITY RATIOS
Current Ratio 11.97 11.25 9.4
Quick Ratio 11.97 11.25 9.4

12/31/2016 12/31/2015 12/31/2014

PROFITABILITY RATIO
Gross Profit Margin 86% 84% 83%
Operating Margin 45% 35% 40%
Net Profit Margin(ROS) 37% 20% 23%
ROE 17.2% 8.2% 8.1%
ROA 15.6% 7.4% 7.3%
Total Asset Turnover 43% 36% 31%
Sales to Fixed Assets 3% 3% 3%
ROI 50% 27% 42%

DEBT RATIOS 12/31/2016 12/31/2015 12/31/2014

TIE 100% 100% 100%

DEBT/EQUITY 9% 11% 10%
FINANCIAL LEVERAGE 1.22 1.65 1.67
EPS 0.6 1.65 1.29
12/31/2013

11.88
11.88

12/31/2013

76%
36%
19%
9.6%
8.3%
44%
3%
18%

12/31/2013
100%
14%
1.83
3.49
 12/31/2016 12/31/2015

Net income 10,188,000 3,669,000

Cash flows-Operating activities
Depreciation 2,342,000 1,945,000
Net Income Adjustments 2,791,000 3,903,000
Changes in Operating activities
Accounts Receivable (1,489,000) -973
Other Operating Activities -145 -147
Liabilities 2,392,000 1,904,000

Net Cash Flow-Operating 16,108,000 10,320,000

12/31/2016 12/31/2015

Net income 10,188,000 3,669,000

Cash flows-Investing activities
Capital Expenditures (4,491,000) (2,523,000)
Investments (7,186,000) (6,700,000)
Other Investing Activities -62 -211
(11,739,000)
Net Cash Flows-Investing (9,434,000)

12/31/2016 12/31/2015

Net income 10,188,000 3,669,000

Cash flows-Financing activities
Sale and Purchase of Stock 0 0
Net Borrowings -312 -119

Other Financing Activities 2 -20

Net Cash Flows-Financing -310 -139

Effect of Exchange Rate -63 -155
Net Cash Flow-Financing 3,996,000 592
12/31/2014 12/31/2013

2,925,000 1,491,000

1,243,000 1,011,000
3,405,000 1,035,000

-610 -378
-339 213
687 841
7,326,000 4,222,000

12/31/2014 12/31/2013

2,925,000 1,491,000

(1,831,000) (1,362,000)
1,243,000 -882
(5,325,000) -380
(2,624,000)
(5,913,000)

12/31/2014 12/31/2013

2,925,000 1,491,000

0 1,504,000
-243 (1,891,000)
-55 -889
-298 -667
-123 8
992 939