Winland Electronics, Inc. (NYSE Amex: WEX) today reported sales of Proprietary Environmental Monitoring products of $984,000 for the second quarter ended June 30, 2011, up $233,000, or 31.0 percent, from the $751,000 that the company reported in the comparable period in 2010. Net loss from the quarter totaled $140,000, or $0.04 per share, an improvement over a loss of $822,000 in the second quarter of 2010. The loss for the current quarter was attributable primarily to lower gross margins. The company reported an operating loss of $250,000 for the three months ended June 30, 2011 compared to an operating loss of $475,000 for the comparable period in 2010. Gross margins decreased from 38.2 percent to 33.7 percent for the three months ended June 30, 2011 compared to the same period in 2010. As has been the case in previous quarters, the declines in gross margin were expected based on the agreed upon price structure that is part of Winland’s manufacturing agreement with Nortech Systems, Incorporated. “The positive sales trends we have been experiencing continued into our second quarter,” said Brian Lawrence, Winland’s Chief Financial Officer and Senior Vice President. “Sales were up seven percent on a sequential quarterly basis, the result of a large project sale to a new customer, and continued strong sales from our existing customers. We continue to gain traction in our markets as both new and existing customers recognize the value of our critical condition monitoring solutions.” During the second quarter Winland recognized additional sales of EMS related inventories to Nortech. These sales provided additional cash flow and a net gain on the sale of the EMS business. The company continued to benefit from the lower cost structure realized by its restructuring in late 2010 and early 2011. General and Administrative expenses totaled $295,000 for the second quarter, down $215,000 year-over-year. Sales and marketing expenses were $240,000 for the three months ended June 30, 2011, down slightly from the second quarter of 2010. The decrease was due to reduced product support costs of $10,000, reduced advertising expenses of $7,000 offset by increased salaries and benefits expenses of $16,000.