Sale of Firm Boosts Zero’s Profit by 38%

Zero Corp. said its earnings were up 38% in its third quarter ended Dec. 31, largely because of the sale of a company in which it had a 40% interest. Zero’s sales, however, were down less than 1% from the same quarter last year, to $30.6 million.

The Burbank-based company, a leading maker of metal cases and cabinets for electronics equipment, said its net income for the third quarter was $3.8 million, or 38 cents a share.

Zero President Wilford D. Godbold Jr. said the earnings were improved by the sale in October of the company’s stake in Ocean Technology, an engineering company, for $11 million. The after-tax gain from the sale was not disclosed.

Zero said its profit also was boosted by its acquisition of Contempo Engineering in August. On the other hand, the company said, its earnings were reduced by an increase in bad debt reserves for the part of its business serving the computer peripherals industry.

The company said sales were off slightly because of a continued slump in the computer industry, which buys many Zero products.

Zero also announced a 5-for-4 stock split to be distributed March 10 to shareholders of record as of Feb. 17.