The board of directors of Lake Forest-based Telenetics Corp. has approved a 1-to-5 reverse stock split, dropping the number of shares of common stock outstanding to 9 million from 45 million, the company said Monday.
The split is an attempt to repackage the company's capital structure to "attract a larger potential investor base," said Telenetics Chief Executive Michael Armani.
Telenetics, a maker of meter-reading products and industrial modem devices, had been experiencing financial difficulties for much of the decade. But company officials say the firm is turning itself around. For its second quarter ended Sept. 30, the company reported net income of $86,604, compared to a net loss of $134,075 for the same period a year earlier. Revenue rose to $1.12 million from $413,483.
Pending shareholder approval, the company's reverse stock split will become effective Jan. 8.
Telenetics stock, which trades over the counter, rose 3 cents Monday, closing at 22 cents a share.