Cherokee International Corp. reported net sales for the fourth quarter ended December 31, 2005 were $32.7 million, down 11% compared to $36.7 million for the fourth quarter of 2004, and up 24% compared to $26.4 million for the third quarter of 2005. Net income for the fourth quarter of 2005 was $78,000, or $0.00 per diluted share, compared to net income of $2.2 million, or $0.11 per diluted share, for the fourth quarter of 2004, and a net loss of $2.2 million, or $0.11 per diluted share, for the third quarter of 2005.
Gross margin for the fourth quarter of 2005 was 19.2%, up from 17.7% for the third quarter of 2005. Operating income for the fourth quarter of 2005 was $321,000 or 1.0% of net sales, compared to an operating loss of $1.6 million, or 6.2% of net sales, for the third quarter of 2005.
"We are pleased to have exceeded our late-December revenue guidance," said Jeffrey M. Frank, Cherokee's President and Chief Executive Officer. "We experienced strong demand from our high-end server and storage markets along with increased demand from our telecom accounts."
For the year ended December 31, 2005, net sales decreased 18% to $122.1 million, compared to $148.5 million for 2004. Net loss for the year was $3.2 million, or $0.17 per diluted share, compared to net income of $10.4 million, or $0.62 per diluted share, for 2004.
"Since September 2005, we have experienced a general improvement in end-market demand which has continued throughout the first quarter, and we expect sequential top line unaudited revenue growth for the first quarter of 2006 of approximately 11%," stated. Frank.
