Datum, Hiring Earlier in Year, Lays Off 50

Citing a backlog of inventory in its warehouses and uncertainties about short-term demand for cellular telephones, Datum Inc. announced Wednesday that it will lay off about 50 of the 450 workers at the company’s Irvine plant.

“They have been notified and they will be going” Thursday, said David A. Young, the company’s chief financial officer.

Datum, which makes sophisticated timing devices and other wireless communications components, was hiring employees earlier this year as it increased production to meet the demand of several large orders. And by the end of the third quarter, the company said, product inventory had increased $2.8 million over the second quarter.

Additionally, Young said, the construction of bay stations that are needed to operate cell phones has slowed down recently, casting doubt on the short-term demand for Datum’s timing devices.

With the demand in question and the warehouse full, the company said the prudent move was to temporarily decrease production.

“There are large, irregularly spaced orders that are occurring here,” Young said. “And what they do is produce irregular quarters.” However, Young said he does not believe the slowdown reflects negatively on the long-term demand for Datum products.

Also on Wednesday, the company released its earnings report for the third quarter ended Sept. 30. It said net income more than doubled to $1.6 million, or 28 cents a share, from $649,000, or 15 cents a share, a year ago.

Revenue rose to $30.2 million from $24.5 million. Net income for the nine months totaled $4.8 million, or 90 cents a share, up from $982,000, or 23 cents a share, for the same period last year. Revenue increased to $92 million from $64.4 million.

The stock, which was traded at $49.50 a share a month ago, closed Wednesday at $25.63, down 31 cents for the day.