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Ducommun Reports Loss, Blames Aerospace Slump

October 28, 1987|DAVID OLMOS

Ducommun Inc. said it lost $2.5 million in its fiscal 1988 third quarter and blamed the loss primarily on poor results in its aerospace business.

The Cypress-based electronics and aerospace firm reported that sales for the quarter ended Oct. 2 rose 4.1% to $115.7 million, from $111.1 million in the year-earlier period.

Ducommun said earlier that it had agreed to sell its electronics-distribution business, including the Kierulff Electronics, Ducommun Data Systems and MTI Systems units but intended to keep the aerospace business because it traditionally has been more profitable.

Wallace W. Booth, Ducommun's chairman, president and chief executive, Tuesday described the third-quarter loss as "particularly disappointing after two consecutive quarterly profits." He said the firm "remains confident" that the aerospace business will return to profitability in the fourth quarter.

Arrow Electronics Inc. of Melville, N.Y., has agreed to purchase Ducommun's electronics businesses for about $130 million in cash and stock.

That agreement, executed before the stock market began its precipitous slide, is contingent on Arrow's stock maintaining an average price of $6 per share or more in the 20 trading days preceding the close of the deal. Arrow's stock in recent days has been hovering around the $6 mark.

Ducommun said sales and operating profit for its electronics business "improved somewhat" compared to both the second quarter and 1986's third quarter.

For the nine-month period, Ducommun reported a profit of $4.7 million, contrasted with a loss of $525,000 in the corresponding period of 1986. Sales rose 2.5% to $347.8 million, from $339.4 million.

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