Power-One reports loss despite higher sales

Power-One Inc. announced that net sales for its third quarter ended September 29 increased 13.1% to $60.0 million from $53.1 million in the third quarter of 2001, and increased sequentially from $56.2 million the previous quarter.

Including non-recurring items, the Camarillo, Calif., power supplier incurred a third-quarter net loss of $198.5 million, or $2.45 per share, compared to a net loss of $43.3 million, or 55 cents per share, in the year-ago quarter.

Excluding non-recurring items, Power-One's third-quarter 2002 loss was $6.2 million, or 8 cents per share.

In connection with the restructuring plan announced September, Power-One recorded a $194.3 million pre-tax charge for employee severance and facility consolidation, asset impairment, write-down of inventory, deferral of stock compensation, and a valuation allowance against deferred tax assets.

During the third quarter, Power-One's net new orders were $53.4 million, down 8.1% from $58.1 million the second quarter, and the book-to-bill ratio was 0.89 compared with 1.03 the previous quarter. Orders were driven by demand for the company's high-density DC/DC converters and AC/DC supplies.

"While the communications environment continues to be very challenging, we were able to exceed our sales target and also meet the low-end range of our cash loss forecast," said Steve Goldman, Power-One's chief executive, in a statement. "We expect that as the additional restructuring initiatives recently launched gain traction, we will be able to further reduce our cash loss to the 3 to 5 cent per share range during the fourth quarter. Visibility continues to be very limited with roughly a 90 day time horizon going forward."

For the fourth quarter of 2002, Power-One anticipates flat sales, with gross margins ranging from 28 to 30%.