If they don't make their own radios... who does?
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EFJ blames supplier for first quarter loss
http://www.omaha.com/index.php?u_pg=46&u_sid=2162139
By Virgil Larson
EFJ Inc.'s stock price fell 29 percent Tuesday after the company reported that revenue fell 56 percent and its profits turned to losses in the first quarter.
The Irving, Texas, company, which has a subsidiary in Lincoln, reported a loss of $3.1 million, a swing of more than $8 million from the $5.2 million in profits the company reported in the first quarter of 2005. Per share, the 28 cents in profits a year ago shifted to a 12 cent loss.
Revenue in the quarter that ended March 31 was $10.56 million, compared with $24.16 million a year earlier.
The stock fell as low as $5.51 Tuesday, down $4.41, before recovering to a $7.03 close, off $2.89 from Monday's close. Volume was 6.15 million shares on a stock that averages fewer than 196,000 shares a day.
The company blamed the sharp turn in earnings on faulty components a supplier provided for the two-way radios a third party builds for EFJ. The "supply chain issue" delayed production and delivery of radios to customers, mostly the military and public safety agencies.
EFJ also noted that revenue in the first quarter of 2005 was unusually high at the Lincoln subsidiary, Transcrypt International. Transcrypt, which makes encryption software and hardware for radios, had an $8 million single order a year ago.
The company lowered its revenue estimate for 2006. It said it now expects sales of $105 million to $115 million, down from the earlier guidance of $120 million to $125 million.
No estimate was given for income before income taxes because, Michael Jalbert, the chairman and chief executive said, "we are assessing the cost impact associated with this supply chain issue."
The company earlier had projected pre-tax profits of $14.5 million to $16.5 million.
"We expect 2006 to be profitable," Jalbert said.
The supply problem is fixed, he said, and April deliveries were "pretty close" to plan. But the problems will cause a two-quarter delay in the company's expectation that operating margins would rise to the mid-40 percent range in the fourth quarter, he said.
EFJ had profits of $22.55 million - nearly $10 million of it in tax-deferred benefits - on revenue of $94.62 million last year.
The company used to manufacture its own radios at a Minnesota plant but closed that and switched to outsourcing the manufacturing.
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EFJ blames supplier for first quarter loss
http://www.omaha.com/index.php?u_pg=46&u_sid=2162139
By Virgil Larson
EFJ Inc.'s stock price fell 29 percent Tuesday after the company reported that revenue fell 56 percent and its profits turned to losses in the first quarter.
The Irving, Texas, company, which has a subsidiary in Lincoln, reported a loss of $3.1 million, a swing of more than $8 million from the $5.2 million in profits the company reported in the first quarter of 2005. Per share, the 28 cents in profits a year ago shifted to a 12 cent loss.
Revenue in the quarter that ended March 31 was $10.56 million, compared with $24.16 million a year earlier.
The stock fell as low as $5.51 Tuesday, down $4.41, before recovering to a $7.03 close, off $2.89 from Monday's close. Volume was 6.15 million shares on a stock that averages fewer than 196,000 shares a day.
The company blamed the sharp turn in earnings on faulty components a supplier provided for the two-way radios a third party builds for EFJ. The "supply chain issue" delayed production and delivery of radios to customers, mostly the military and public safety agencies.
EFJ also noted that revenue in the first quarter of 2005 was unusually high at the Lincoln subsidiary, Transcrypt International. Transcrypt, which makes encryption software and hardware for radios, had an $8 million single order a year ago.
The company lowered its revenue estimate for 2006. It said it now expects sales of $105 million to $115 million, down from the earlier guidance of $120 million to $125 million.
No estimate was given for income before income taxes because, Michael Jalbert, the chairman and chief executive said, "we are assessing the cost impact associated with this supply chain issue."
The company earlier had projected pre-tax profits of $14.5 million to $16.5 million.
"We expect 2006 to be profitable," Jalbert said.
The supply problem is fixed, he said, and April deliveries were "pretty close" to plan. But the problems will cause a two-quarter delay in the company's expectation that operating margins would rise to the mid-40 percent range in the fourth quarter, he said.
EFJ had profits of $22.55 million - nearly $10 million of it in tax-deferred benefits - on revenue of $94.62 million last year.
The company used to manufacture its own radios at a Minnesota plant but closed that and switched to outsourcing the manufacturing.
