SIOUX FALLS, SD -- Raven Industries today reiterated its strategy to focus more on proprietary electronics products as it reduces its exposure to contract assembly.

The EMS firm reported cosolidated second-quarter sales rose 1.2% year-over-year to $94.5 million, led by demand for engineered films.

Overall net income was $7.7 million, down from year-earlier net income of $8.3 million, for the period ended July 31.

Revenue from Raven's strategic proprietary product lines, which represent all of the company excluding contract manufacturing, increased $8.2 million, or 10% to $88.4 million in the quarter. The company's Applied Technology and Aerostar divisions saw mixed results.

Said president and chief executive Daniel A. Rykhus, "Consolidated sales and net income for the corporation fell short of expectations primarily due to persisting weakness in agriculture equipment markets. Within Aerostar, we are pleased that our work with Google is ramping successfully.

"Raven continues to make important progress moving to more proprietary product lines with advanced technologies. As we exit the low-growth contract manufacturing business, in the short term, Aerostar and Applied Technology revenues are affected. In the second quarter, this planned runoff resulted in revenue decreases of approximately $5.5 million for Aerostar and $1.6 million for Applied Technology. "

For the 2015 second quarter, sales in Applied Technology were $36.2 million, versus $39.1 million last year, again reflecting a sluggish ag equipment market. Operating income was $8.8 million, compared to $11.9 million in the prior-year period.

Demand for agriculture equipment in North America is soft, and is expected to remain so for the next four quarters, Raven said. Aerostat and radar shipments increased as a result of previously announced government contracts. Google Project Loon revenues ramped 175% during the period and are exected to continue to grow in the second half.