Tustin-based Cherokee International Corp., a maker of power supplies for computers and other electronics, said Wednesday its operating profit fell in the fourth quarter, despite a gain in sales.
Cherokee’s sales for the fourth quarter rose 11% to $36.7 million, compared to $33.1 million a year earlier.
Operating profit fell 3% to $3.6 million, versus a year ago. The company reported its sales and marketing expenses jumped 20% to $2.1 million in the period.
Company officials said in a release they expect sales in the first quarter to be its lowest in 2005, reflecting a combination of normal seasonal trends and effects from moving some products to consignment sales.
Cherokee was one of Orange County’s biggest initial public offerings last year. The company raised $110 million in its IPO in February 2004. Cherokee used the proceeds largely to pay back company debt.
The company has had a rough time on Wall Street since its debut, with shares falling more than 50% to just under $8. Cherokee was hit hard in October after warning that sales and earnings would be lower than expected in the third quarter.
The culprit: weakness in sales to one customer, Nortel Networks Corp.
