SCIENCE/TECHNOLOGY : Advanced Logic Research Starts to Feel the Effects of a Slow Computer Market

After performing well in a down computer market, even Advanced Logic Research Inc. in Irvine is starting to slow down.

In preliminary results, ALR said Monday that it expects earnings for its first quarter ended Dec. 31 to be “significantly below” the $3.1 million recorded for the period last year. Revenue is expected to fall 3.6%, to $48 million from $49.8 million a year earlier.

As the company warned in November, higher operating expenses and falling PC prices will take a toll on sales and profits. But no quarterly loss is expected, said James T. Richardson, chief financial officer.

ALR stock closed Monday at $10 a share, up 25 cents in over-the-counter trading.

The company expects to report final results in February.

Gene Lu, chief executive, said the company is evaluating its operating plan as it places greater emphasis on sales of low-end models that produce leaner profit margins. He said no layoffs are anticipated.

“We grew 30% in the previous fiscal year, and it would have been nice if we kept that rolling,” Lu said. “I don’t think anybody is immune to the recession.”

Despite difficult market conditions, Lu said, the company improved cash reserves from $23.4 million to $33 million in the quarter.

And in spite of renewed competition in ALR’s established markets from Compaq Computer Corp. in Houston, Lu said ALR will stick to its strategy of selling only through major computer distributors and retail chains such as Intelligent Electronics, ComputerLand and JWP Businessland. The strategy contrasts with a push by rival AST Research Inc. in Irvine to sell directly to major corporations.

Lu said the company will also focus on international sales, which accounted for 40% of sales last quarter compared with 35% for the previous quarter.

ALR Revenue Fiscal years end Sept. 30 In millions ‘92: $48 million* *forecast Source: Advanced Logic Research Inc.