Odetics to Pare Wages and Staff in Wake of Loss : Electronics: The Anaheim company’s loss of a contract with a major client is blamed for its $3.3-million red-ink third quarter. Layoffs are possible.

ANAHEIM —  Odetics Inc., announcing a quarterly loss Wednesday, said it will reduce its employees’ pay across the board and offer incentives for some workers to take early retirement.

Officials of the Anaheim-based company, which makes automated tape libraries and closed-circuit video recording equipment, would not comment further on the pay cut or retirement plans, revealed in a news release.

However, analysts said that in a conference call Wednesday the company also mentioned the possibility of layoffs. According to company officials, analysts said, the pay reductions will be 10% for employees and 15% for managers. The company employs 600.

For the latest quarter, “the losses were a lot worse than I was expecting,” said William Gibson, an analyst with the brokerage Cruttenden & Co. in Santa Barbara. “I thought they would be marginally profitable.”

Instead, the company posted a loss of $3.3 million, or 55 cents a share, for its third fiscal quarter, which ended Dec. 31. That contrasted with a profit of $591,000, or 10 cents a share, for the same period a year earlier. Revenue was $23 million, up from $21.9 million.

Though the company had reported a 71% drop in income for the previous three months, analysts said, they were surprised by the size of the shortfall for the latest quarter.

The company said it was hurt by the loss of a contract with a major client, E-Systems Inc., which accounted for 7% of the company’s revenue for its latest fiscal year. Odetics said it has taken legal action against E-Systems, seeking damages for a breach of contract.

But analysts said Odetics’ problems may run deeper.

“They are market leaders in the small niches they work in, but they have not achieved the profitability that other companies who dominate small markets have,” Gibson said. “They have to get their costs in line with what they are doing.”

For the first nine months of its fiscal year, Odetics reported a loss of $2.7 million, or 46 cents a share. That contrasted with a profit of $992,000, or 19 cents a share, for the same period a year earlier. Nine-month revenue rose 12% to $68.1 million from $61.0 million.

In Wednesday’s Nasdaq trading, Odetics’ stock lost 25 cents a share to close at $5.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Odetics Posts Quarterly Loss

Odetics Inc. officials said Wednesday that the company lost nearly $3.3 million for the quarter ended Dec. 31, mainly because it lost a major customer. Figures below are in thousands of dollars, except data per share:

3rd qtr 3rd qtr 9 months 9 months 1994 1993 1994 1993 Revenue $22,952 $21,905 $68,107 $60,970 Net income (loss) (3,258) 591 (2,742) 992 Per share (loss) (0.55) 0.10 (0.46) 0.19

Source: Odetics Inc.