Eagle Computer Inc., already engaged in a desperate search for new financing, a merger partner or an outright buyer, said Tuesday that it lost $2.4 million in the second quarter of its fiscal year, bringing total losses in the last 2 1/2 years to more than $40 million.
"It's been bleak for over a year and it's not getting better," said Gary Kappenman, chairman and chief executive of the Garden Grove company. "It's getting worse."
For the second quarter, which ended Dec. 28, Eagle had sales of $1.5 million, down 73% from $5.7 million a year earlier--when the company had a one-time sale of $4 million worth of computers to China. Losses a year ago were $1.7 million.
Kappenman, who has been heading Eagle's difficult turnaround effort for the last 18 months, said the primary activity at Eagle these days is concentrated on selling the company's dwindling assets.
Last week, Eagle transferred its sales operations to a subsidiary of the Korean company that already manufactures Eagle's only computers.
The deal leaves Eagle with no ongoing operations. Royalty fees from the Korean companies are its only steady revenue source.
Kappenman said the company is willing to sell its technology, the income tax credits from its string of losses, or even the entire company. "Of course we'd sell the company," he said. "We'll sell anything."
He said that laying off nearly 30 employees last week had put him in a "down mood" and added that, although he believes that Eagle will find the cash it needs to resume operations, "the real question is, how much pain will be involved in getting there?"
In the last six months, Kappenman has said repeatedly that Eagle needs at least $4 million to bring its new computer line to the market.
Without the new product, he has said, Eagle will never be able to turn itself around.