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Whittaker Corp. Seeks Waiver in Loan Agreement

September 10, 1996|Barbara Murphy

Whittaker Corp. of Simi Valley said sluggishness in its communications division resulted in a fiscal third-quarter loss of 54 cents a share, causing the company to violate a provision in its loan agreement.

The communications and aerospace company said its earnings before interest, taxes and depreciation fell below a minimum set in a credit agreement signed in April to finance its acquisition of Xyplex Inc.

Gerald Finnell, vice president and chief financial officer, said Whittaker is seeking a waiver and amendment to the loan agreement to reflect its new forecasts for this year. The company doesn't expect to post a profit again until spring.

"We're highly optimistic that we'll get the waiver and amendment," Finnell said. "We're trying to work with the banks to make sure the amendment covers our operating plans for 1996."

This is the second straight quarter in which Whittaker has endured a heavy loss, largely because of its communications unit. Prior to that, the company had a five-year string of profitable quarterly results.

In an attempt to expand its computer networking business, Whittaker last year bought Hughes LAN Systems from Hughes Electronics for $32.5 million. In April, Whittaker bought Xyplex from Raytheon Corp. for $117.5 million in stock and cash.

For the three months ended July 31, Whittaker posted a loss of $5.95 million, compared with net income of $1.75 million, or 18 cents, in the year-ago quarter. Sales rose 40% to $62.2 million from $44.3 million.

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