1st-Quarter Net Income Down for EIP Microwave

EIP Microwave Inc. Tuesday reported net income for the first fiscal quarter, ended Dec. 27, declined 81% to $75,000 from $402,000 for the same quarter a year earlier. During its 1985 fourth quarter, EIP’s earnings dropped 98%.

Sales for the first quarter were $4.5 million, a decrease of 9% from $5 million a year earlier.

Mark K. Howlett, EIP’s vice chairman, attributed the decrease to sluggish small-quantity domestic sales and damage to international sales from the strength of the dollar.

He said the market for the test and measurement instruments EIP manufactures--primarily for the defense and telecommunications industries--will probably remain depressed for at least another quarter. However, Howlett said, EIP should show improvements in sales and profitability in the second half of 1986 because of new products introduced last year and accelerating shipments of its orders.

During its first quarter, the company received $10.6 million in orders, $7 million of which came from a U.S. Air Force base in San Antonio, Texas. The number of orders is a 147% increase over the same period last year and is a new record for the company, Howlett said. Shipments of the Air Force order began in the first quarter, Howlett said, and will continue through fiscal 1986 and into fiscal 1987. EIP also reports a backlog of $10.6 in orders----another company record.

In June, the company laid off 30 of the 230 employees at its San Jose manufacturing plant and, despite the upturn in sales predicted for the second half of 1986, Howlett said it is “unlikely” that those positions will be filled although more factory workers may be hired to fill the company’s pending orders.

Last year, EIP introduced a new microwave source and a counter that measures the pulse of radar that, Howlett said, should improve sales over the course of the year.