Data-Design’s Finances Distress Stockholders
At a stormy annual meeting, the chief executive of electronics manufacturer Data-Design Laboratories Inc. told angry shareholders Monday that the company is trying its best to stave off a bankruptcy reorganization.
Data-Design reported a loss of $4.1 million, or 62 cents per share, for the first quarter ended Sept. 30, compared with a loss of $1 million, or 16 cents a share, a year earlier. Revenue fell 19% to $18.1 million, compared to $22.3 million a year earlier.
For the 12 months ended June 30, Data-Design had a loss of $15.3 million, or $2.31 a share, on revenue of $77.7 million, compared with a loss of $7 million, or 44 cents a share, on revenue of $78 million a year earlier.
The losses have jeopardized the company’s cash position and it also faces a possible loan default on Nov. 16, when two lenders have the right to declare $14.6 million in loans immediately due, the company reported.
Despite the losses, Thomas Beiseker, chairman of Data-Design, said the company believes its recent actions such as laying off 180 of its 280 employees in Orange County and shutting a circuit-board manufacturing plant in Anaheim will help the company recover. He blamed the company’s continuing losses on severe price cutting among electronics manufacturers that are themselves trying to stay afloat in the recession.
Beiseker also said the company is talking to four potential investors, including one that it will meet with today, about an unspecified capital investment in the cash-strapped company.
“We can’t say any more about this potential investor until we know more about their plans,” Beiseker said. “The only one with a plan came to us (last) Thursday.”
Those words did little to calm half a dozen angry shareholders at the company’s annual meeting at the Marriott Hotel in Newport Beach.
“This company has a disaster facing it 11 days from now, and I want to know what you’re doing about it,” said Joseph DiLillo, chief executive of Santa Monica-based Drake Capital, whose clients hold about 16% of the company’s outstanding bonds. “I don’t see anything happening.”
MORE O.C. EARNINGS: D14
