Relm Wireless sees profit in second quarter
Two-way radio communications equipment manufacturer Relm Wireless has reported a profit for the second quarter ended June 30, its first profitable quarter in three years. The company’s most recent full year of profitability was 1995.
Relm reported net income of $145,000, compared to a net loss of $542,000 for the same period in 2000. Revenue for the second quarter increased 20% to $6.2 million, from $5.2 million for the same period last year.
Revenue from land mobile radio products grew 27% to $6.2 million compared to $4.9 million for the same period in 2000. The increase resulted from BK Radio product sales principally to the U. S. Forest Service and to the Communications Electronics Command of the U. S. Army. These sales included $1.1 million worth of model GMH mobile radios that were introduced last year. Besides BK Radio, the company’s other brand names are Uniden PRC and RELM.
One of Relm’s dealers, Robert J. Samo, president of Silverado Avionics in Napa, CA, traces his sales of BK Radio products to Ed King of King Radio.
“Ed designed a portable that would do exactly what the fire agencies wanted it to do. It gave the company a foothold in the fire agency market that has held up over the years,” Samo said.
King Radio and Bendix Aviation were purchased and combined by Allied in the mid-1980s, leading to the Bendix/King name. Relm acquired the land mobile radio portion of the Bendix/King business and shortened the brand to BK Radio. In 1985, Allied merged with Signal Companies, becoming AlliedSignal, and again merged in 1999 with Honeywell, taking the Honeywell name. Honeywell continues to sell aviation radios under the Bendix/King name.
Samo started in the aviation radio business 35 years ago, although land mobile radio now is the larger part of his enterprise. Silverado Avionics supplies BK Radio portables to the California Department of Forestry. Samo said the department is one of the largest fire agencies in the world.
“What attracted them to Relm’s BK Radio products is the fact that they have been using the Bendix/King product for decades. It has held up well, and they continue to use it because it satisfies their needs with its specialized features. Also, its use runs parallel to that of the U.S. Forest Service, which uses the same radio,” Samo said.
Thom Morrow, Relm’s senior vice president of sales and marketing, said that the company expects to reach $22 million in sales this year. He attributed some of the company’s success to keeping a substantial inventory of Uniden products.
“We have 9,000 to 10,000 Uniden radios on hand to serve the customers. If a dealer calls and wants a radio and we don’t have it, their immediate reaction is ‘Here we go again; it’s like the old days.’ And the same thing with parts,” Morrow said, referring to Relm’s need to avoid any doubts about its current finished goods and parts inventory.
Morrow said the inventory is expected to stabilize the company’s sales and prove to the dealer network that Relm is serious about its business.
Along the way to profitability, Relm has sold its real estate for a capital gain, outsourced its manufacturing and reduced its employee number from 150 to 85. Some of the former employees went to work for Honeywell Electronic Manufacturing Services, which bought some of Relm’s real estate and manufacturing equipment last year and contracted to make some of Relm’s products.
In January, Montreal-based C-Mac Industries, a company with 10,000 employees and 51 manufacturing plants worldwide, bought Honeywell’s manufacturing subsidiary. C-Mac builds the BK Radio product to the core level. Then Relm’s manufacturing team builds up the models to fit customer needs. For example, the same core portable can be housed either in plastic or metal and can be fitted with a keypad.
Last year, Relm acquired the Uniden Private Radio Communication product line from Uniden Corporation, which continues to make mobiles and portables for Relm under the Uniden PRC name. Morrow said that Relm wants to maintain the manufacturing relationship with Uniden Corporation for years to come.
Relm also is developing Project 25 radios under the product name of Aurora. The radios are slated for introduction during 2002.