Oak Industries Posts Loss of $37.6 Million for Year

Oak Industries, in the midst of a bond conversion effort that could lead to a desperately needed capital infusion and a 32% ownership position by Allied-Signal, reported a $37.6-million net loss for the year ended Dec. 31, 1985.

The financially troubled Rancho Bernardo-based company also said that, for the third consecutive year, its auditors have qualified the company’s year-end financial statements. The auditors, Coopers & Lybrand, said that Oak’s “ability to continue in existence” is dependent on reducing its debt, generating additional cash or generating profits from operations.

The qualified opinion does not give a timetable to its warning, although it seems apparent that the opinion is linked to Oak’s current drive to convince holders of $230 million in notes and bonds to exchange them for common stock.

Oak’s sales in 1985 reached $284.3 million, down 15%. Last year’s loss compares to a loss of $149.3 million in 1984, which included $53.7 million in red ink from discontinued operations and another $49.4 million from a non-recurring provision for restructured operations.