| Pro Forma – Total Costs 21 All $ in 000s We have provided Pro Forma Operational Expense, a non-GAAP financial measure, to supplement our consolidated financial statements and our business outlook to improve comparability and better understand cost trends within the on-going business, which combines the amounts reported for the above periods. We believe these non-GAAP financial measures are useful to investors because they allow for greater transparency with respect to key metrics used by management in its financial and operational decision making. The most directly comparable GAAP financial measures is Cost of Sales plus Total Operating Expense, disclosed above. Management recognizes that the use of this non-GAAP measure has limitations, including the fact that it might not be comparable with similar non-GAAP measures used by other companies and that management must exercise judgment in determining which types of charges and other items should be excluded from its non-GAAP financial measures. Management currently compensates for these limitations by providing full disclosure of each non-GAAP financial measure and a reconciliation to the most directly comparable GAAP measure. The presentation of this financial information is not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Cost of Sales 20,735 24,314 20,294 31,167 25,878 24,805 23,411 Total Operating Expenses: Product Development & Engineering 3,699 3,390 4,022 4,233 4,648 4,454 4,628 Selling, General and Administrative 12,630 11,163 11,415 13,392 12,394 9,451 10,308 Impairment of Goodwill 1,055 - - - Total Costs (Pro Forma) 37,064 38,867 36,786 48,792 42,920 38,710 38,347 |