Anaheim’s Multi-Fineline Electronix Inc. said profits dropped 75% for the recently ended quarter on falling prices and weak sales to its biggest customer, Motorola Inc.
The maker of flexible printed circuit boards that go into flip phones and other devices reported profits of about $3 million, down from $12.5 million a year earlier.
Sales were down 8% to $113.4 million.
At the end of March, the company, known as M-Flex, lowered its outlook for the quarter on lower sales from what it called “a leading handset maker.”
It’s widely known that the cell phone maker is Schaumburg, Ill.-based Motorola, which makes up about 68% of M-Flex’s sales.
M-Flex didn’t cite Motorola in its quarterly release but came close by referring to Symbol Technologies Inc., which Motorola paid nearly $4 billion in cash and stock for in January.
The company was buoyed by better than-expected sales at its unnamed second largest customer. It’s less clear who M-Flex’s No. 2 is, though it could be LG Electronics Inc., Samsung Electronics Co., Royal Philips Electronics NV or Research In Motion Ltd.
Sales were up 12% to the No. 2 from the December quarter.
M-Flex said it plans to beef up production in China with $33 million in improvements slated for this year. The investment is expected to generate an additional $14 million in sales per month, said Phil Harding, M-Flex’s chief executive.
M-Flex’s troubles don’t end with earnings.
It’s still engaged in a protracted battle with its parent company WBL Corp. of Singapore, which is looking to combine M-Flex with sister company MFS Technology Inc. of Singapore.
M-Flex opposes the deal, which would bring another Motorola-dependent company into the fold.
The company has been going through the motions of filing the required paperwork to buy MFS with the Securities and Exchange Commission, while vocally urging shareholders to oppose the deal every step of the way.
