SENSORMATIC WARNS ON EARNINGS AS STOCKS DECREASE 31%
The Wall Street Journal reports that Sensormatic Electronics Corp., a manufacturer of electronic security equipment, expects its fiscal third-quarter earnings to miss Wall Street estimates by as much as 70 percent. The warning is due to the weakness in the U.S. economy and in overseas currencies.
The stock’s drop is nearing a 52-week low and comes on the heels of a March sale of more than 300,000 of the company’s shares by company insiders, including the chairman. Sensormatic President and CEO Per-Olof Loof says that it wasn’t until the end of the quarter that “much to our surprise, customers said, ‘Let’s take a pause here with our installations’” due to economic conditions, according to the article.
Sensormatic says it now expects to post earnings of 6 cents or 7 cents per share, down from 14 cents for the year-earlier period. Analysts surveyed by Thomson Financial/First Call had expected 21 cents per share.
The company says it expects revenue to fall to about $256 million from $261 million a year earlier. The euro and British pound has also affected the company, the article states. Europe accounts for 40 percent of the company’s sales.
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