Oak '95 sales up 11%; loss posted

Electronic News, Feb 19, 1996

Waltham, Mass.--Oak Industries Inc. reported FY95 net sales grew 11 percent to $276.6 million from $249.0 million in FY94.

Also reported was a net loss for the year of $52.1 million, or $2.83 per share, versus net income of $42.4 million, or $2.31 per share, last year.

FY95 results included after-tax nonrecurring charges of $83.7 million, or $4.54 per share, including a net charge of $80.9 million for the write-off of Lasertron purchased in-process research and development and another net charge of $1.2 million related to the expensing of the purchase accounting write-up of Lasertron inventory. Oak also reported an extraordinary charge of $1.6 million linked to early extinguishment of debt.

FY94 results included nonrecurring income of $9.7 million, or 53 cents per share, derived from FAS Rule 109 on income tax accounting, net of a restructuring charge, and a state income tax benefit. Operating income before nonrecurring charges reached $58.0 million for the year ended Dec. 31, 1995, up 20 percent from $48.3 million in FY94.

The tax rate for financial reporting rose from 9 percent in FY94 to 23 percent in FY95. Earnings per share for the year ended Dec. 31, 1995, before nonrecurring items, were $1.41, up 22.6 percent from $1.15 in FY94, also before nonrecurring items. 4Q95 sales grew 16 percent to $73.0 million from $63.1 million in 4Q94.

Oak, a maker of components for the telecommand consumer appliance industries, reported 4Q95 net income fell to $4.2 million, or 23 cents per share, from $17.4 million, or 94 cents per share. The latest quarter included a net nonrecurring charge of $0.9 million, or 5 cents per share, related to Lasertron inventory. Operating income, before nonrecurring charges, rose 21 percent to $15.0 million from $12.4 million.

Year-ago results included nonrecurring net income of $8.8 million, or 47 cents per share, tied to a benefit from the FAS income tax accounting rule, partially offset by a restructuring charge.

Oak's tax rate for financial reporting surged to 39 percent in 4Q95 from 9 percent in 4Q94.

Earnings per share for the quarter ended Dec. 31, 1995, before nonrecurring items, were 33 cents, versus 31 cents, in 4Q94, before nonrecurring items and adjusted to reflect a full effective tax rate in both periods.

Said CEO William S. Antle III: "Our communications businesses continue to perform extremely well with sales for the fourth quarter up 39 percent over the prior-year period. Gilbert Engineering achieved historically high volume levels benefiting from strong growth in both domestic and international markets. We are particularly pleased with the performance of Gilbert and its Cabel-Con subsidiary in the international arena...."

Mr. Antle continued: "The excellent performance of our Communications Group was partially offset by the lackluster sales in the Controls Group. Sales in this sector decreased 13 percent in FY95 over FY94. However, operating income for the Controls Group remained flat on a year-to-year comparison as cost-reduction programs offset the impact of reduced volumes."

He added: "We leave 1995 a stronger and more focused company. The investment in Lasertron enhances our presence and broadens our customer base in the telecom market."