Applied Circuit Reports $500,000 Loss in Quarter

Still suffering the loss of its major customer a year ago and burdened with the costs of its latest acquisition, Applied Circuit Technology Inc. of Anaheim has reported a first-quarter loss of $498,973 and a 43% decline in sales.

The company blamed a “majority” of the red ink on the money-losing operations of its Certel subsidiary which was acquired in November. However, executives acknowledged that the company is still trying to recover its momentum after losing the primary customer for its disc drive testing equipment in early 1984.

“We’re still trying to get into new markets and broaden our customer base,” said Sam Auriemma, vice president for finance. “We’ve made some progress, but we have more to do.”

Applied Circuit’s problems began in January, 1984, when International Business Machines reduced the number of disc drives it purchased from Seagate Technologies in Scotts Valley, Calif. Because Seagate was Applied Circuit’s major customer, Seagate’s loss became Applied Circuit’s problem, as well.

Revenues for the first quarter of 1984, ended Jan. 31, were $2.71 million, down from $4.79 million in the year-ago period, the last to include sizable business from Seagate. The quarterly loss of $498,973 compared to a profit of $619,891 a year earlier.

Although the latest results are considerably lower than those of the year earlier, company executives note that they represent an improvement from the performance of the previous three months when Applied Circuit lost $1.23 million. The latest results also reverse a nine-month slide in earnings, which led Walt Menetrey, Applied Circuit’s president, to term the performance “a significant turnaround.”