CMS Reports Its Earnings Nose-Dive 91%

Hobbled by losses related to excess inventory, CMS Enhancements Inc. reported Thursday that its earnings plunged 91% to $407,000 for its fiscal year ended June 30.

The Tustin computer products company posted earnings of $4.8 million a year earlier.

Sales for the year declined 6.3% to $187.7 million, from $200.4 million a year earlier.

“While fiscal 1990 does not represent results that we are pleased with as a comparison with the prior fiscal year, we are looking ahead to fiscal 1991 with cautious optimism,” said Jim Farooquee, president and chief executive.

For the fourth quarter, the company lost $1.7 million, contrasted with earnings of $1.2 million a year earlier. Farooquee attributed the loss to a $5-million writedown of the company’s inventory of computer tape backup products at its plant in Singapore.

Sales for the quarter were $33.6 million, down 21.7% from $42.8 million a year earlier. The lower sales were due mainly to tougher competition in the industry, Farooquee said.

CMS spokesman Bill Lackey said the company will move most of its 425 employees from its overcrowded headquarters in Tustin to a building near Michelson Drive and Jamboree Boulevard in Irvine. He said the move is scheduled to begin at the end of September.

CMS stock closed unchanged Thursday at $3.25 per share on the New York Stock Exchange.

The Tustin firm supplies data storage equipment and related gear for personal computers.