APR loses in '90, admits to error in '89 report

September 21, 1990|By Maria Mallory

Applied Research Corp., a Landover-based high-technology company that gained notice for its work on the troubled Hubble Space Telescope, is having its share of woes here on planet Earth. The company reported a 13 percent plunge in revenues for its most recent fiscal year.

In announcing restated results for fiscal 1989, ARC took a $323,625 write-off to correct accounting mistakes that cost its former chief financial officer and controller their jobs earlier this year, said Surendra P. S. Anand, ARC's president and chief executive.

ARC also reported a net loss of $271,487 for fiscal 1990, compared with an adjusted net loss of $194,506 the year before.

The company markets high-tech software and equipment to other aerospace companies, the Department of Defense and the National Aeronautics and Space Administration. NASA contracts accounted for 64 percent of the company's 1990 revenues, Mr. Anand said.

ARC is assisting in studies of stars' chemical composition via the Hubble's Faint Object Spectrograph.

The 1990 net loss of 5 cents a share resulted, in part, from administrative and overhead costs that exceeded the negotiated limits on some contracts, said controller Andy Moorer.

The net loss for the fourth quarter was $128,154 on revenues of $1.57 million, said Mr. Moorer, who joined the company in May.

Mr. Anand described the mistakes as "mathematical errors in calculation that the auditor did not catch." The mistakes overstated the contractor's revenues for unbilled receivables. ARC has enlisted KPMG-Peat Marwick to handle its books.

Pointing to a $23 million contract backlog and strong cash flow, Mr. Anand said ARC is putting its financial troubles behind it. "We are expecting at least a 20 percent increase in business for 1991," he said.

Mr. Anand controls about 80 percent of ARC's stock, which is traded on the Philadelphia Stock Exchange.

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