Omaha cinema and lighting equipment company Ballantyne Strong on Thursday reported a 29 percent drop in second-quarter profits on a plunge in sales of digital theater equipment.
Most movie theaters have already made the switch from older analog equipment, the company said, while noting an improvement in gross profit margin as the firm shifts to smaller revenue streams with higher profit margins.
Net income was $1.27 million, or 9 cents a share, compared with $1.80 million, or 13 cents a share, in the second quarter of 2012.
The company said it shipped 250 digital projection systems in the quarter, compared with 556 a year ago. Total sales of theater products and services, the company’s biggest business segment, were $21.5 million, compared with $46 million a year ago.
Cinema screen sales grew 18 percent to $3.9 million, with growing demand from North American movie theaters that are upgrading.
Managed services revenues fell about 6 percent to $3.1 million. The lighting segment saw revenue of $2.9 million. Comparable figures from a year ago were not available, but the company said the revenue included a “noteworthy” contribution from the completion of the World Trade Center spire lighting project.
Noting the company’s profitability in its first two quarters this year, chief executive officer Gary Cavey said, “We have effectively right-sized our business and have put in place a cost structure that makes sense.”
He said gross profit margin for the quarter was 19.2 percent, compared with 13.6 percent a year ago.