San/Bar’s Loss Expected to Set 23-Year Record

San/Bar Corp. said Friday that it is writing off an additional $500,000 worth of equipment and expects to show a loss of more than $6 million for the fiscal year ended June 30--for the worst year in the company’s 23-year history.

The unaudited figures, which have not been released, “reflect less-than-desirable results,” according to a letter sent Friday to shareholders of the Irvine telecommunications firm. The company said operating revenues for the fiscal year would be in excess of $15 million, which compares to revenues of $27.1 million for fiscal 1984. In the prior fiscal year, San/Bar had net income of $424,000. The company took $2.2 million in write-offs in the third fiscal quarter.

Company spokesman Lloyd Hallamore attributed the decline in revenues and net income to an overall slump in the telecommunications industry, but he said restructuring of company operations should allow San/Bar to operate on a profitable basis in the next fiscal year.

Earlier this year San/Bar, laid off nearly a third of its 300 or so employees after closing one of its two plants in Garland, Tex., and transferring its manufacturing operations to Irvine. The company also closed a Canadian plant.

Break-Free Spinoff

The letter also said that San/Bar still intends to spin off its Break-Free lubricant business into an independent company and has moved that division into a separate plant in Santa Ana. Hallamore said Break-Free accounted for about 20% of San/Bar’s sales but was not related to its primary telecommunications operations. He said the company is trying to get a favorable ruling from the Internal Revenue Service as to whether the additional shares of stock from the spin-off would be considered tax dividends before proceeding with that action.

In addition to its operations, San/Bar has extraordinary income resulting from a $29.3-million out-of-court settlement in 1984 of an anti-trust lawsuit against American Telephone & Telegraph.