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Wavetek’s Chief Predicts ’86 Return to Profitability

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Times Staff Writer

Wavetek will return to profitability in fiscal 1986, chief executive John W. Battin predicted Wednesday.

Since joining the San Diego-based maker of electronic test and measurement equipment in April, Battin has closed half of the company’s domestic manufacturing plants, trimmed several unprofitable business lines and laid off 15% of Wavetek’s 1,232-member work force.

“Based on the first two months and two weeks of fiscal 1986, I’d say we’re on schedule if not ahead of schedule” for a return to profitability early in 1986, Battin said during a presentation for the Financial Analysts Society of San Diego. “We’ve gotten rid of the problem (businesses) that would have been prohibitively expensive to make profitable.

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“I’ve spent the past six months cleaning out things so I could get a clearer view of what was going on,” said Battin, who sold off product lines that contributed nearly $9 million of the company’s $75.4 million in 1984 sales.

Wavetek, the nation’s largest producer of cable television test equipment with 40% of the market, had been badly hurt by an ongoing industry slowdown, Battin said.

However, he predicted that sales would rebound because cable television companies are now boosting budgets for test equipment used to maintain and upgrade older systems.

Although Wavetek logged a $14.3-million loss during the fiscal year ended Sept. 28, it might soon be healthy enough to make an acquisition, said Battin, who declined to describe what kind of acquisition the company would seek.

“We ended (1985) with $13 million in cash, have between $15 million and $16 million now and will be at the $20-million level by midyear,” said Battin.

However, Wavetek “has been burned and is shy . . . about an acquisition binge,” said Battin, who linked losses during late 1984 and all of 1985 to an earlier “acquisition binge.”

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Battin predicted that Wavetek, despite its cash-rich status, has not evolved into an attractive takeover target. “I didn’t move from a big company to San Diego so I could work for a big company again,” quipped Battin, who joined Wavetek after 27 years as an engineer and manager with Motorola.

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