Methode Reports Fiscal 1Q Loss, Sues Delphi

CHICAGO (AP) — Methode Electronics Inc., a maker of electromechanical devices for the automotive and computer industries, reported a small fiscal first-quarter loss Thursday on weak economic conditions and said it is suing Delphi Automotive Systems Inc. for breach of contract.

Methode reported a loss of $19,000 for the quarter ended Aug. 1, breaking even on a per share basis, compared with a profit of $6.8 million, or 18 cents a share, in the year-earlier quarter. Revenue fell 33 percent to $89.8 million from $134.5 million a year earlier.

The company said it was notified that Delphi would end its long-term contract for Methode to supply it parts on September 10. Methode supplies sensor pads to Delphi.

"The company is contesting Delphi's right to prematurely terminate this long-term supply arrangement, and the parties are engaged in litigation regarding this supply arrangement and the company's intellectual property," said Methode in a written statement.

A Delphi spokesman confirmed the company is engaged in litigation with Methode.

Methode said revenue fell in its automotive unit, on lower sales, restructuring, and a planned termination of contracts with Chrysler Group LLC and Ford Motor Co.'s North American division. Revenue for the unit fell 39.6 percent to $51.2 million for the quarter, compared with $84.7 million for the comparable quarter a year ago. Methode attributed the drop to extended plant shutdowns by General Motors Co. and Chrysler.