The sluggish fourth quarter anticipated by Key Tronic Corp. officially materialized Tuesday when the Spokane-based computer keyboard manufacturer announced its results for fiscal 1997.

For the quarter ended June 28, Key Tronic produced a net income of $39,000, or 0 cents per share, on sales of $43.4 million. That compares with a net loss of $3.2 million, or 37 cents per share, on sales of $42.6 million, during the fourth quarter of fiscal 1996.

For the year, Key Tronic produced a profit of $322,000, or 3 cents per share, on sales of $184.9 million. That compares with a net loss of $1.8 million, or 22 cents per share, on sales of $201 million for fiscal 1996.

Even though the year’s and quarter’s performance was a significant improvement on the previous comparable periods, that performance wasn’t sufficient to save Fred Wenninger’s job as Key Tronic’s chief executive officer.

Analysts had expected Key Tronic to produce earnings of 5 cents per share for the fourth quarter. But in May, Wenninger announced the company’s sales would fall short of projections, and that the analyst’s earnings predictions would not be met.

Wenninger was relieved of his duties as CEO in June, and replaced by Jack Oehlke, the company’s chief operating officer.

Wenninger said the decline in sales was due to industrywide sales slowdowns, and big inventories that prompted major Key Tronic customers to cancel or delay orders.

The fourth-quarter financial results include a one-time expense of $1.1 million “to further streamline Key Tronic’s facility in Ireland,” which has been converted from a manufacturing facility to a distribution center for European sales. The company also had severance costs of approximately $350,000.

“This has been a challenging year for Key Tronic,” Oehlke said Tuesday in a news release. “Nevertheless, we accomplished a great deal in restructuring our company to be more competitive.”

, DataTimes