10K is out...excerpt:
2006 vs. 2005
Total contract revenues in 2006 were $2,274,868 compared to $1,549,669 in 2005, an increase of 46.8%. Contract revenues in both years were derived entirely from SBIR contracts. The increase was due to increased billings on the Phase III SBIR contract and revenues from the RWSE Phase II contract which was awarded in May 2006. Additionally and as a result of these contracts, our cost of sales increased from $932,717 in 2005 to $1,361,255 in 2006, an increase of approximately 45.9%.
General and administrative expenses were $429,391 in 2006 compared to $305,317 in 2005. These expenses increased due to higher costs incurred for administrative salaries and bid and proposal consultants, and related costs.
Engineering expenses were $324,357 in 2006 compared to $229,610 in 2005. The increase in engineering costs for the year ended December 31, 2006 was due to the RWSE Phase II contract and rental and related costs associated with the lease of our research and development office located in Fort Washington, Pennsylvania.
Income from operations increased to $159,865 in 2006 as compared to $82,025 in 2005. The increase resulted primarily from our revenue and cost of sales increasing approximately 46% and our operating expenses increasing only 41%. Net income remained essentially constant in 2006 as compared to 2005. Specifically, we realized net income of $129,800 in 2006 compared to net income of $134,525 in 2005. This was primarily attributable to the Company reversing a larger portion of its valuation allowance against its deferred tax assets associated with available net operating loss carryforwards during 2005 and 2006.
AI
