Blaming a sagging market for electronic-testing equipment, Applied Circuit Technology Inc. of Anaheim said Monday that it lost $1.5 million in its first quarter, three times the loss of a year ago.
For the period ended Jan. 31, the company, which makes automatic test equipment for computer disk drives, had sales of $2.25 million, 16% below the $2.71 million reported in the year-ago quarter. Losses in the prior year were about $500,000.
"Results of the latest quarter reflect an overall softness in the current market for disk drive test equipment," President Walter R. Menetrey said in a prepared statement. "The decrease in revenue in the first quarter is attributable to significant decreases in shipments of our disk drive test equipment."
The test equipment market has softened because the overall market for small computers has been in a slump for the past year.
Menetrey said ACT has moved to cut costs by laying off 36 of its 244 employees in January, instituting job-sharing programs, and reducing executive and management salaries by 15%.
He said he expects sales to remain weak through the summer, but he projected an upturn by the end of the year as higher data-storage capacity and other technology is introduced in the disk drive industry.
Despite the sagging performance, Menetrey said ACT is continuing negotiations to complete its acquisition of Whiteworth International Inc., a Gardena manufacturer and marketer of generic drugs and pharmaceuticals. The acquisition, announced late last year, is intended to make Applied Circuit Technology less dependent on the cycles of the disk drive industry.