Sym-Tek President Expects Profit to Double in Year

SAN DIEGO--Sym-Tek Systems Inc. said Wednesday that, despite a slowdown in the semiconductor industry, it expects its net income to nearly double to about $1.5 million and sales to increase about 70% to $34 million for the fiscal year ending March 31.

Sym-Tek President Ray Twigg told the Society of Financial Analysts here that the manufacturer of test equipment for semiconductors expects the industry to pull out of its slump by summer. As a result, Sym-Tek’s profits will jump to $2.3 million on sales of $41 million in fiscal 1986, he said.

Twigg said that, although demand for computer chips is slow, more test equipment will be needed because many producers are concentrating on development of new lines.

During the past two years, Sym-Tek’s share of the semiconductor test equipment market has grown from about 20% to about 35%, according to Sym-Tek Chief Financial Officer R. G. Sidorchuk.

The market for these test devices is estimated at $100 million worldwide and is expected to grow to more than $200 million during the next four to five years.

Twigg said the company plows more than 5% of its revenue into new product development and has an expanded product line that will be introduced in the fourth quarter of fiscal 1986.

Net income growth may exceed sales increases during the next several years as new management controls take effect.

Sidorchuk said controls developed in the past 18 months have improved Sym-Tek’s profit margin to 10.8% from 7.4% and its return on shareholders’ equity to 39% from 24.7%.

With the new management systems, Sym-Tek has been able to reduce the average collection time on its billings to 66 days from 99 days and the average inventory supply to 148 days from 224 days.

The company is planning to install a new computer-based inventory control system that should further reduce expenses, he said.