The LGL Group, Inc. (NYSE Amex:LGL) (the “Company”), announced results for the quarter ended March 31, 2012.
First Quarter 2012 Financial Results
Total revenues for the three months ended March 31, 2012, were approximately $7,174,000, a decrease of 20.5% compared to revenues of $9,020,000 for the comparable period in 2011. The Company reported a net loss of ($593,000) for the three months ended March 31, 2012, compared with net income of $241,000 for the same period in 2011. Diluted loss per share was ($0.23) for the quarter ended March 31, 2012, compared with earnings per share of $0.10 for the quarter ended March 31, 2011.
The decrease in revenues for first quarter 2012 was due to continued weakness in the global macroeconomic environment and delays in capital decisions for telecommunications (“Telecom”) infrastructure spending, as well as due to the low levels of demand which continue to prevail in the Military, Instrumentation, Space and Avionics (“MISA”) market segments. The decrease in net income is a direct result of the decrease in revenues, as well as decline in gross margin for the period which was the result of pricing and cost pressures throughout the supply chain.
Greg Anderson, LGL’s President and Chief Executive Officer said, “We are disappointed with our first quarter’s performance. Our results clearly reflect the business cycle that we are working through. Capital spending in our markets remains tight and is having a direct impact on our Company’s financial performance. We are addressing the recent challenges affecting gross margins while at the same time seeking to maintain the strong operating leverage that we’ve previously demonstrated. We do expect the business cycle to improve. LGL has a strong balance sheet, strong customer positions, excellent technology, and remains positioned to weather the current business cycle.”
The Company’s order backlog increased to $8,895,000 at March 31, 2012, which was a 3.0% increase, compared the backlog of $8,634,000 at December 31, 2011. Mr. Anderson said, “Engineering activity remains high as existing and new customers are requesting new designs which have the potential to lead to new product revenue in future quarters. While it is difficult to predict timing of production orders from these efforts, we’re encouraged by the activity and are focusing our efforts on products that will support applications for the 3G/4G/LTE wireless infrastructure, microwave radio internet data backhaul and radios for public service, military and avionics.”