Comarco Has ‘Turned the Corner’ After Loss, Chief Executive Reports
Anaheim defense contractor Comarco Inc. is showing signs of getting back on its feet after last year’s huge loss.
Comarco on Monday reported earnings from continuing operations of $414,000 for its fiscal first quarter ended April 22, compared to earnings of $254,000 a year earlier. Comarco’s net earnings were $5.2 million, which included a $4.8-million extraordinary gain from the conversion of Comarco debt to common stock.
Sales were $21.9 million, up 4% from $21 million a year earlier.
Comarco is “strongly encouraged” by its latest quarter results, Chief Executive Walter Sterling said. Sterling, a former Comarco chairman and longtime director, returned as chief executive last August as part of a management shake-up.
But there was some bad news mixed in with the good for the Anaheim firm.
Comarco also reported that its loss for its fiscal year ended last January was bigger than originally stated. The company lost $12.9 million on revenues of $76 million last year, instead of the $10.2-million loss originally reported. Comarco attributed the higher loss to expenses related to product development, the sale of certain operations and excess office space.
Comarco is a provider of defense-related computer systems and services.
Sterling said the company has slashed $5 million in operating expenses by reducing staff and overhead, reducing interest payments on loans and eliminating lease expenses on certain property. “Our financial situation is greatly improved,” Sterling said. “We’ve turned the corner.”
The company is hoping for some good news this week involving a key contract to provide engineering services to the U.S. Naval Weapons Center in China Lake. The five-year, $95-million contract--by far Comarco’s largest--expires at the end of the month.
Sterling replaced former Comarco Chairman and Chief Executive Glenn D. Buell Jr. last August. Sterling said he plans to remain in the chief executive’s job until the company can find a successor. “We are actively looking for a replacement for me, but I’m in no hurry,” he said.
