Key Image Systems Blames $2.4-Million Loss on R & D

Chatsworth-based Key Image Systems Inc. reported a $2.4-million loss for the fiscal year ended March 31, after reporting a profit of $56,000 the previous year. Revenue fell by 33% to $1.3 million from $1.8 million.

“The loss on lower revenues resulted partly from substantial research and development expenditures,” said chairman Fery Aalam, whose company makes and sells computer systems that “see” and analyze the images they take in.

He said the higher research and development costs stem from efforts to change the company’s emphasis from custom-made to standardized systems.

Aalam also said sales of a Key Image’s software package did not meet expectations, and that the acquisition of a 47% interest in I-SYS Technology Inc. hurt earnings. Earnings were helped by the purchase of Gulf Data Inc., he said.

For the fourth quarter, the company reported a loss of $637,000. It had a loss of $58,000 in the same quarter a year ago. Revenue for the quarter was relatively flat, at $635,000 versus $639,000 in 1984.