Certron Posts Quarterly Losses, Announces Move to Curb Costs

Forced into a price-cutting battle with foreign competitors, Certron Corp. of Anaheim posted losses for its fourth quarter and fiscal year, ended Oct. 31, and said it will move all of its audio cassette production to Hong Kong to take advantage of lower labor costs.

Certron, which manufactures audio tape cassettes and distributes blank video cassettes, already does the bulk of its audio tape manufacturing in the Far East. It has only 25 employees still involved in tape manufacturing at its Anaheim plant. Another 500 workers are employed by Certron at a Mexicali, Mexico, assembly plant.

Terry Frisco, company treasurer, said the company is “uncertain” whether those employees will be laid off.

Certron posted a loss of $9,000 for its fourth quarter, compared with profits of $220,000 in the same quarter the year before. Revenues during the final 12 weeks of 1984 were virtually flat at $7.7 million.

For the 1984 fiscal year, Certron lost $200,000, compared with a $371,000 profit during fiscal 1983. In 1984, the company’s revenues were $28.3 million, up 10% from sales of $25.7 million the year before.

Frisco attributed the losses to stiff competition from foreign manufacturers and distributors. In the face of an oversupplied market and fierce price-cutting, Certron has lowered the price of the video cassettes it distributes by about 30% during the past year.