Cipher Data Chairman Says Firm Set for Renewed Growth

Cipher Data is poised for renewed growth, Chairman Don M. Muller said at the firm’s annual meeting Monday.

Last year, Cipher Data responded to slowed revenue and net profit growth by trimming back its payroll, reducing inventories and bringing several new products to market, The firm recently reported an 83% drop in net income, to $655,000, and a 15% decrease in revenues, to $36.2 million, for the first quarter, which ended Sept. 30.

That quarter followed a disappointing second half of fiscal 1985, during which Cipher Data was hit by a “very sudden and intense” drop in demand from the manufacturers of minicomputers and computer-aided design and computer-aided manufacturing.

“We’ve taken the prudent and necessary steps,” Muller said, adding that “the first quarter of 1986 was the bottom . . . The company now has a very strong opportunity for growth.”

Much of Cipher Data’s future growth will be tied to the introduction of computer tape drive products being developed in conjunction with IBM, Muller said. The joint venture, announced in July of last year, will likely generate “very substantial” revenues, Muller said.

Muller described Cipher Data’s balance sheet as “strong . . . we’ve got no debt, either short or long, we’ve got $25 million in cash and a $50 million line of credit with our banks.”