Electroglas, which cut its work force by 15 percent and reduced salaries for those remaining by the same amount, said the steps were “not enough to compensate for the precipitous drop in revenue” during its fiscal 2009 third quarter, for which it released results today.
“Clearly we are disappointed in these quarterly results,” said the company’s recently apointed Chief Executive Warren Kocmond in a statement, who noted that its “customers stopped buying in early 2009 as their near term business outlook weakened and fear spread throughout the world economy.”
The company, which supplies wafer probing equipment and software used by chip makers, said it is in the process of “adjusting to these business realities and have additional plans in place to dramatically lower our break even point which should return us to positive gross margins this quarter.”
The company, which did not hold a conference call to discuss its results, said it would have “further announcements” in the next several days on steps it would take to “make additional cuts and preserve (its) cash resources.”
Earlier this month the company reached an agreement with Comerica Bank limiting the amount of additional money the company could borrow to $25,000, from $3.1 million. Electroglas had committed as part of its credit agreement with Comerica to maintain deposits with the bank of $3.5 million, an amount that has now been reduced to $425,000. Electroglas has previously reported retaining Needham & Co. to help it explore “strategic options.”
The company reported last month that it had retained Needham & Co. to help it explore “strategic options.”