Despite shrinking cash and questions from shareholders about whether it can survive, TVI Corp. said yesterday that its turnaround is on track.
The Glenn Dale manufacturer of decontamination shelters reported improved sales for the third quarter but still posted a loss.
"While we all would like to speed up the process, we believe our management team is setting realistic, tangible, short- and long-term goals for TVI and is working at a steady, substantial pace," interim chief executive Harley A. Hughes told shareholders during a conference call to discuss third-quarter results. "We believe we will be able to show the fruits of our labor over the coming weeks and months."
Several shareholders questioned the board's decision to amend company bylaws to adopt a state provision for preventing hostile takeovers or a breakup of the company's assets. Shareholders said they should have been allowed to vote on the measure and contend the motive was to keep the current board intact.
Investor Jeffrey Squires said the board has not been receptive to shareholder concerns and that executives "could be more revealing" about the state of the company.
Earlier this year, the company's audit committee found questionable overpayments to a supplier, which resulted in the ouster in April of CEO Richard V. Priddy and Charles L. Sample, executive vice president. The Securities and Exchange Commission and the Justice Department are investigating business dealings that took place in 2004.
Hughes, who was put in charge of the company in August, said he understood the shareholders' "angst" but predicted that 2008 is going to be "pretty good."
For the third quarter, TVI had a net loss of $3.9 million or 12 cents per diluted share, compared with profit of $973,000 or 3 cents per diluted share for the quarter a year ago. Sales rose 39 percent to $11.8 million from $8.5 million a year ago.
Cash and investments totaled $125,000 as of Sept. 30, compared with $4.2 million as of Dec. 31, 2006.
Chief Financial Officer Sherri S. Voelkel said the company has "little or no borrowing capacity" and is limiting its daily expenditures. Hughes said the company is working to restructure its bank credit agreement, which has been extended to Dec. 31.
TVI stock fell 6 cents in trading on the Nasdaq yesterday to close at 23 cents per share.