ST. LOUIS - LaBarge Inc. today reported net sales rose 68% to $48.7 million and net earnings increased 94% to $2.7 million record highs for the fiscal second quarter ended Jan. 2.

The results include the company's Pittsburgh operation, acquired last February.

For the first half, net sales rose 57% to $92.4 million, while net earnings from continuing operations were up 81% to $5 million.

Total net earnings for the first half grew 88% to $5 million.

Gross margin in the second quarter was 21.6%, down from 22.4% a year ago. SG&A expenses as a percentage of sales fell to 11.9%, from 15%.

Total debt was $38 million, up a fraction.

Backlogs as of Jan. 2 were $145 million, down 3% sequentially and up 27% from last year.

Defense customers - primarily buyers of LeBarge's EMS services - accounted for 49% of sales. Shipments of capital equipment to industrial customers were 18%. The company also provides capital equipment for oil-and-gas and mining operations, commercial aerospace and government systems.

LaBarge guided for "substantially higher" year-on-year third-quarter revenues and earnings. The firm said sales and earnings would likely drop slightly sequentially.

For the fiscal year, the company expects revenues and earnings to grow at least 35%. The firm reported revenue of $131.5 million for fiscal 2004.