Jul. 23--NAUGATUCK -- The Eastern Co., a local manufacturer, reported Wednesday that its net income fell 38 percent in the second quarter, compared with a year ago, amid the struggling economy.

The company earned $842,000 last quarter, or 13 cents per diluted share, down from $1.4 million or 22 cents per share a year ago.

The Eastern Co. makes industrial hardware, security products and metal castings. Based locally, it operates in nine countries.

"The continuing weak global economy has had a downward effect on most of the markets we serve," President and Chief Executive Officer Leonard F. Leganza said in a statement.

In particular, the company's industrial hardware segment has been hurt by a decreased market of heavy trucks and other vehicular uses for its products, he said.

Overall, the company's sales fell 22 percent in the second quarter, to $28.1 million from $36.1 million a year ago.

"However, not withstanding the gloomy impact of the economy, as we look ahead at our operations, there are some very promising factors," Leganza said.

Among them, the mining industry remains strong, bolstering the company's metal products division.

Also, the division that serves the commercial laundry market is in the process of launching several new products, including its "Flash Card" payment system, that have received positive feedback from within the industry, Leganza said.

Earlier this year, in the first quarter, the company implemented various cost reductions and will adjust its strategy as needed moving forward, according to company officials.

"Further initiatives will be instituted to respond to any further weakness in the economy," Leganza said. "These actions will also make us more efficient when the economy improves."

Shares of The Eastern Co. rose 5 cents to close at $17.95 Wednesday.

-----

To see more of New Haven Register, or to subscribe to the newspaper, go to http://www.nhregister.com.

Copyright (c) 2009, New Haven Register, Conn.

Distributed by McClatchy-Tribune Information Services.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

AMEX:EML,

A service of YellowBrix, Inc.