Circuits Assembly Online Magazine - Restructuring Behind, Sypris Ready to Grow Anew

LOUISVILLE, KY -- Sypris Solutions today reported fourth-quarter revenue at its Electronics Group fell 24% from last year to $19.5 million.

For the period ended Dec. 31, the unit's gross profit increased 7.7% to $5.6 million, or 28.8% of revenue. Sales were down, the contract electronics manufacturer said, due to the completion of certain programs, partially offset by the launch of a new secure communication program.

For the period ended Dec. 31, overall company revenue increased to $67.2 million during the period, up 1.7% from the prior year. Gross profit increased 30.2% to $7.6 million, and gross margin increased to 11.2% of revenue, up 240 basis points. The Electronics Group gross margin increased to 28.8% of revenue, up from 20.4% for the prior year quarter. The operating loss was $2 million for the quarter, compared to an operating loss of $3.6 million for the prior year period. Including the company's discontinued Test & Measurement operations, the company’s quarterly net loss was $1.6 million, down from net income of $22.6 million a year ago.

For the year, the company’s net loss was $10.2 million, versus net income of $2.7 million in 2009, when the company benefited from a gain of $18.3 million from the sale of marketable securities. The EMS company reported revenue of $266.7 million and an operating loss of $7.4 million compared to revenue of $265.9 million and an operating loss of $22.8 million for the prior year.

Jeffrey T. Gill, president and chief executive, said, “We look forward to returning to profitability in 2011 now that we have successfully restructured the business. We expect to see strong double-digit comparable period growth in the top line of our Industrial Group going forward, as the recovery of the commercial vehicle market continues.

“For our Electronics Group, we expect the number of patent applications to increase by 50% during 2011, as we drive to further expand our product and intellectual property portfolios. R&D investment is planned to approximate 6% of revenue, as we focus on delivering solutions for our nation’s rapidly expanding Cyber Security needs. The impact of these new products and technologies is expected to contribute to the company’s financial results as early as 2012.”