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EFTC To Post Second Quarter Loss.

DENVER--(BUSINESS WIRE)--July 6, 1999--

EFTC Corporation (Nasdaq:EFTC), an electronic manufacturing services company specializing in high mix services announced today it expects to show an operating loss in the second quarter of $0.15-0.20 per share. The loss is primarily due to greater than expected softness in its services business, and certain revenue shortfalls in its manufacturing business.

To address this profitability issue, EFTC is eliminating approximately 150 jobs, and has plans to further reduce costs through operating improvements and business reorganization. For strategic and financial reasons, EFTC has signed a Letter of Intent to sell its repair/warranty service business for approximately $30 million and is entering into a business relationship with the purchaser to be able to continue to offer hub based repair/warranty services to customers. The sale and business restructuring its expected to result in pre-tax charges of $25-35 million in the third quarter.

"The actions we are taking will strengthen our balance sheet, reduce excess capacity, allow us to better service our core high mix customer base, and better position us for future growth," said Jack Calderon, EFTC's Chief Executive Officer.

EFTC, a provider of high mix electronic manufacturing services, is headquartered at 9351 Grant Street, 6th Floor, Denver, Colorado, 80229, and has facilities located in Arizona, Florida, Kansas, Kentucky, Massachusetts, New Hampshire, Oregon, Tennessee, and Washington State. The Company provides its services to OEM customers in the aerospace/avionics, medical, instrumentation, computer related, and communications industries. EFTC employs approximately 2500 people nationwide.

Safe Harbor statement under the Private Securities Litigation Reform Act of 1995: Certain of the above statements contained in this press release are forward-looking statements that involve a number of risks and uncertainties. Such forward-looking statements include that the actions taken will increase profitability, and that the sale of the service business will, in fact, be transacted, and if such sale is closed that it will transact at approximately $30 million, and that EFTC will be able to continue to sell hub based repair warranty services through the business relationship, and that these actions would position the Company for future growth. Factors that could cause actual results to differ materially include the following: business conditions and growth in the Company's industry and in the general economy; competitive factors; risks due to shifts in market demand; and the risk factors listed from time to time in the Company's reports filed with the Securities and Exchange Commission as well as assumptions regarding the foregoing. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. Readers are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those indicated in the forward-looking statements as a result of various factors. Readers are cautioned not to place undue reliance on these forward-looking statements.
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Publication:Business Wire
Geographic Code:1USA
Date:Jul 6, 1999
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