Menomonee Falls-based Magnetek Inc. today reported a fiscal first quarter net loss of $1.8 million, or 6 cents per share, compared with net income of $881,000, or 3 cents per share, in the same period a year ago.
Magnetek recorded revenue of $17.8 million, a 32-percent decrease from a year earlier and an 11-percent sequential decline from the fourth quarter of fiscal 2009.
The decline in sales from the prior year quarter reflects the continued slowdown in industrial activity in the United States and the resulting impact on capital spending levels, the company said.
Peter McCormick, Magnetek's president and chief executive officer, said, "As expected, the difficult market conditions we experienced in the second half of fiscal 2009 continued throughout the first quarter of fiscal 2010. While industrial production in the U.S. increased slightly during the September quarter, capacity utilization rates remained well below historical averages and credit markets remained tight, resulting in sluggish capital spending levels which impacted our sales volume in the first quarter." Magnetek expects sales for the second quarter of fiscal 2010 to reflect a sequential double-digit percentage increase from the current year first quarter sales. Gross margins in the second quarter of fiscal 2010 are expected to be near the company's 30-percent target, due to cost savings from actions taken to reduce the company's cost structure.
"While we have not yet seen a robust recovery in our business to date, certain indicators seemingly support the assertion that the June quarter may have been the bottom in terms of order rates, and that the September quarter was the cyclical bottom in terms of revenue. As a result, we believe our sales for the second quarter will increase sequentially from the first quarter, and our current outlook projects improving quarterly trends for the remainder of the fiscal year," McCormick said.
Magnetek CEO says company's financial bottom is in rearview mirror
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