Perceptronics Says Dispute Led to 70% Earnings Drop

Perceptronics Inc., a Woodland Hills maker of tank simulators and other military training equipment, blamed a dispute with a foreign subcontractor for a 70% drop in earnings in its fiscal third quarter ended Dec. 31.

The company’s profit fell to $49,036 in the latest quarter from $162,583 a year earlier. Its revenue, however, rose 8% to $5.82 million from $5.4 million.

In the nine months ended Dec. 31, Perceptronics earned $380,109, down 9% from $416,221 a year earlier, and its revenue rose 11% to $18.1 million from $16.3 million.

Perceptronics said it filed a lawsuit last month in U.S. District Court in Los Angeles against Simtech Advanced Training & Simulation Systems Ltd. of Israel and Tadiran, Simtech’s parent, alleging breach of contract and fraud. The complaint contends that Simtech, which had subcontracted with Perceptronics to produce units for the U.S. military’s Precision Gunnery Training Systems Program, improperly charged Perceptronics for more than $1 million.

Perceptronics said it is seeking to recover the alleged improper charges, plus punitive damages of more than $3 million.