Comarco Inc., a defense contractor and a provider of wireless products, said it will sell its services businesses, including management, staffing and engineering technology, to focus on wireless communications and increase shareholder value.
The wireless business accounts for about 80% of the Santa Ana-based company's earnings.
Comarco said it will be better received on Wall Street as a pure wireless company than as a company with several unrelated businesses.
"We were a defense contractor, and when the Berlin Wall came down we diversified and built a very nice wireless business that some people think has more value than the whole company," said Don Bailey, Comarco chairman and chief executive.
Bailey said he expects earnings to grow 20% once the company focuses on wireless communications because Comarco has little competition for its testing and measurement equipment for cellular phone companies and roadside emergency call boxes. Comarco earned $5.7 million, or $1.13 a share, on revenue of $92 million for the fiscal year ended Jan. 31.