Unova Says It Will Suffer Major Losses; Stock Plunges 32%

Unova Inc., a Woodland Hills manufacturer of bar-code scanners and manufacturing equipment that has been struggling to integrate new businesses, said Friday that it expects significant losses for the remainder of the year.

Shares of Unova, formed in 1994 in the spinoff of several business lines from Litton Industries Inc., fell 32%, or $2.31, to close at $4.94 on the New York Stock Exchange. Its shares have fallen 62% this year.

Unova spokesman Dirk Koerber said the continued deficits should roughly match the company’s pre-tax loss of $22.4 million in its second quarter. Unova actually had a profit of $16.3 million for the quarter, but that came from the sale of a division. Sales for the quarter declined to $480.2 million from $494.4 million in the same period a year earlier.

The company’s Intermec Technologies unit of Everett, Wash., which produces hand-held data-collection devices and bar-code scanners and printers, remains a problem area. Sales are flat at a level the company said was well below its break-even level. At the same time, Unova has had to increase spending on marketing and “turnaround activities” at the division.

And Intermec is mired in an expensive legal battle with Compaq Computer Corp. and Dell Computer Corp. over patents for organizing microprocessor data.

The business has suffered from poor management and problems integrating predecessor companies, said Eli Lustgarten, an analyst with H.C. Wainwright & Co. in New York.

Unova’s industrial automation systems business also is in a slump because of a slowdown in orders of production-line equipment from the automotive industry.

In June, Unova said it hired Credit Suisse First Boston to review strategic options. “That might include selling the company or selling pieces of it,” Koerber said.

“Some parts of the company will be sold and they will have to streamline what’s left,” Lustgarten said. “They have to become profitable. They can’t run a business like this.” The company has posted earnings declines in each of the last five quarters.

Also Friday, the company gave President Larry D. Brady the additional post of chief executive. He replaces Alton J. Brann, who will remain chairman until he leaves the company at the end of the year.