LOUISVILLE, KY -- Sypris Solutions said its Electronics Group's sales fell 52% year-over-year as the impact of the US Defense Department sequestration took its toll. Revenues increased 6% sequentially to $7.7 million in its second quarter ended June 30, while the gross loss declined to $500,000.

The contract assembly unit broke even in the first quarter 2013 and turned a gross profit of $4.3 million in 2012.

Overall quarterly revenue for the company rose 5% sequentially to $82.2 million, and gross profit increased 3% to $8.3 million.

In a statement, president and chief executive Jeffrey T. Gill said, “Our Aerospace and Defense business continues to be affected by budgetary and funding uncertainties within the US Department of Defense that are not expected to be eliminated in the near term. For the longer term, we are continuing to invest in R&D in order to position the business and its product offerings for future growth and profitability, with a specific emphasis on trusted solutions for identity management, cryptographic key distribution and cyber analytics.

"Our Electronics Group will continue to face near-term revenue challenges that we expect to be ongoing until the outlook for defense spending is clarified.”

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