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[March 2006]
Spectrum Control First Quarter Profit; Major Damage to Ceramic Factory Affects Figures
Spectrum Control Inc (Fairview, PA, USA), a leading designer and manufacturer of electronic control products and systems, has reported results for the first quarter ended 28 February 2006.For the first quarter of fiscal 2006, the company generated net income of US$290,000 or two cents per share on sales of US$25.56 million, compared to net income of US$607,000 or five cents per share on sales of US$21.142 million for the first quarter of fiscal 2005.
Dick Southworth, the company's President and Chief Executive Officer, said: "With first quarter revenues up 21% and customer orders up 32% from a year ago, it's clear that there is strong demand for our products.
Sales of our microwave products grew by $2.9 million, of which $2.2 million reflects the impact of our recent business acquisitions. Demand for our microwave products in military/aerospace applications remains particularly strong. Sales of our power management systems increased by $562,000 in the current quarter, as these advanced systems continue to gain market share and recognition. Sales in the current quarter also include $1.7 million for sensor and control products, arising from our acquisition of JDK Controls, Inc. in October of last year."Our profitability in the current quarter was negatively impacted by several factors, including shipment delays and significantly higher material costs from purchasing ceramic components from third party suppliers. Since August of last year, when Hurricane Katrina irreparably damaged our ceramic manufacturing plant in New Orleans, we have been purchasing certain ceramic capacitors from outside vendors. In addressing this issue, we are very pleased with our progress in establishing a new ceramic manufacturing operation in State College, Pennsylvania. By the end of our third quarter of fiscal 2006, we expect this new facility to
reach full production, thereby alleviating the shipment delays and margin pressures associated with buying ceramic capacitors in the open market."On current business outlook, Mr Southworth continued: "Based upon our current sales order backlog and
strong customer order rates, we expect our second quarter sales to be in the range of $30.0 to $31.0 million. If this shipment level is achieved, we would anticipate our profitability to equal or exceed the ten cents of
earnings per share generated in the second quarter last year. Because of inherent uncertainties associated with the phase-in of ceramic production at our new State College facility, we are unable to provide any specific guidance for the Company's financial performance beyond the second quarter. However, we remain very confident and optimistic about the second half of fiscal 2006."www.spectrumcontrol.com
ENDS