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Reptron has little good to report

The Tampa electronics manufacturer finally files fourth-quarter earnings.

By JEFF HARRINGTON, Times Staff Writer
© St. Petersburg Times
published April 16, 2003


Reptron Electronics twice delayed the release of its year-end financial numbers in hope of having some good news to share. It didn't turn out that way.

The Tampa electronics manufacturer lost nearly $10-million in its fourth quarter ended Dec. 31. Sales tumbled even further. Reptron's outside auditor, Grant Thornton, was compelled to include a note in the company's annual 10K filing with regulators Tuesday raising questions about whether it can remain a "going concern," giving credence to bankruptcy fears.

And the reason the 2002 numbers were delayed -- to give time to hammer out a new deal with bondholders -- was for naught. Reptron remains in default on a $76-million bond note due in 2004 that it knows it can't pay. The company has no option but to seek a new deal as its business continues to muddle through a severe, 18-month slump.

"I wish I could say something different, but I don't see any tangible signs of a sustained recovery," Reptron president Paul Plante said in a conference call with investors.

Reptron's net loss of $9.6-million, or $1.50 a share, for the quarter compared to a net loss of $6-million, or 94 cents a share, in the fourth quarter of 2001. The 2002 figures were worsened by a $3.2-million inventory write-down and other charges and reserves totalling $3.6-million.

Sales dropped 4 percent to $76.9-million.

For the year, Reptron lost $26.2-million, or $4.08 per share, compared to a loss of $21.8-million, or $3.42 per share, in 2001. Sales fell 20 percent to $319.6-million.

Shares in the company closed Tuesday at 30 cents each, up 2 cents.

As a contract manufacturer, Reptron makes circuit boards and other electronic components that go into the products of other companies. As a distributor, it sells electronic components to manufacturers.

Both businesses have suffered, but the distribution side is by far the most troubled, unable to recover from dramatic pricing cuts. In the fourth quarter, Reptron's manufacturing unit was slightly profitable while the distribution business posted an operating loss of $13-million.

"The people in that part of distribution are doing a good job," Plante said. "We're simply in an environment the industry has never experienced before."

On the upside, Reptron said it has signed three new customers since the end of the fourth quarter, including one in the medical field that could potentially become its largest customer.

Plante downplayed the auditor's "going concern" note. He said it did not signal any problems beyond what the company already has outlined.

Plante and Reptron chairman and chief executive Michael Musto declined to take questions from analysts and investors following a 40-minute conference call. They suggested analysts contact them individually later.

-- Jeff Harrington can be reached at harrington@sptimes.com or (813) 226-3407.

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