NORTON, MA -- (Marketwire) -- 03/28/12 -- CPS Technologies Corporation (OTCBB: CPSH) today announced revenues of $19.8 million and a net loss of $46 thousand for the year ended December 31, 2011. This compares with revenues of $21.4 million and net income of $710 thousand for the year ended December 25, 2010.
Our results for 2011 reflect softness in demand in some of our key markets which was accentuated in the fourth quarter. We believe the slowdown in demand was due to some customers lowering inventories, and to a combination of factors including the economic crisis in Europe, the mid-year train crash in China which affected our traction business and the general global weakness in economic activity. We view all these factors as temporary. As we look forward, we expect the sluggishness experienced in the fourth quarter of 2011 and into the first half of 2012 to transition to accelerating sales in the second half of this year.
Grant Bennett, CEO, commented, "Given our assessment that sales will accelerate in the second half of this year we have retained staffing levels to support this expected growth. This decision, coupled with certain strategic price reductions, resulted in gross margins in 2011 of 15% compared to 19% in 2010. The strategic price reductions have allowed us to penetrate new applications, and they also reflect our confidence in our ongoing manufacturing improvement activities. Our recent announcement of a four-year supply agreement with a tier one automobile supplier is tangible evidence of the success of this strategy. We are also very pleased with the level of design wins in 2011 which lay a strong foundation for future growth."
CPS Technologies Corporation is a global leader in producing metal-matrix composite components used to improve the reliability and performance of various electrical systems. CPS products are used in motor controllers for hybrid and electric vehicles, high-speed trains, subway cars and wind turbines. They are also used as heatspreaders in internet switches, routers and high-performance microprocessors.