Cerbco Inc., the Bailey's Crossroads-based holding company, said a turnaround by its defense contracting unit and gains from the subsidiary that sells and services fax and photocopy machines boosted its earnings 179 percent in the fiscal third quarter ended March 31.
The jump in quarterly profit to $165,906 (11 cents a share) from $59,463 (4 cents) came despite an 18 percent decline in revenue, which fell to $7.9 million from $9.7 million.
For the first nine months, Cerbco's profit rose 17.5 percent, to $415,275 (28 cents) from $353,366 (24 cents). Revenue fell 11 percent in the period, to $26.6 million from $29.8 million in the comparable period of 1989.
The results for the first nine months of the previous fiscal year were restated for a change in its accounting method for income taxes, adding $455,127 and wiping out a previously reported $101,761 loss for the period, the company said.
Cerbco said the sharp gains by its defense contracting subsidiary, Cerberonics, are due to what it called the temporary combination of two factors. One is that Cerbco is reaping revenue from a large contract that soon will expire, with uncertain prospects for follow-up work.
The other factor, Cerbco said, is that it is recognizing some revenue it expects from another large fixed-price contract. How much revenue it ultimately collects depends on delivery and acceptance of the product, and whether Cerbco can recover costs for work performed under modifications to the contract.
The company is still negotiating with Philadelphia-based ASTA Engineering Inc. to sell Cerberonics to ASTA. It said it expects to complete the deal after it resolves questions about the contract that is expiring.
Franklin National Bank, a District-based financial institution, said it reversed a loss in the first quarter through a restructuring of its loan portfolio.
The bank said it earned $92,492 in the quarter, compared with a $90,382 loss in the year-ago quarter. Total assets reached $43.6 million, up 26 percent from the level at the end of March 1989. Nonperforming assets, or those that are not earning interest, fell to less than 0.5 percent of the loan portfolio, it said.