Air Industries reclaims disputed welding unit in earnings statement

Air Industries Group has added a welding subsidiary back into its latest earnings report released Wednesday amid a legal dispute over the unit's $9 million sale to another Long Island aerospace contractor, CPI Aerostructures Inc. 

Air Industries, a Hauppauge-based maker of aerospace components and assemblies for the military market, had listed the subsidiary, Welding Metallurgy Inc. as a discontinued operation in earlier government filings.

Shares of Air Industries closed unchanged Wednesday at $1.50. The company's shares were trading at $1.35 12 months ago. Shares of CPI Aero lost 1.8 percent to $8.35. CPI Aero's stock closed at $8.55 12 months ago

In July, CPI Aero, based in Edgewood, filed a $5 million lawsuit in State Supreme Court in Manhattan charging that Air Industries failed to abide by a contract, announced in March, to sell the subsidiary.

Air Industries' chief financial officer, Michael Recca, said in a telephone interview that a hearing is scheduled in the lawsuit next week. "This will be the beginning of a long process," he said.

Air Industries posted net sales of $15.8 million for the quarter ended June 30. That compared to $17.1 million for the 2017 period.

Net income rose to $185,000, or 1 cent per share, compared to a net loss of $2.7 million, or 36 cents per share.

Air Industries has been selling assets and seeking to cut costs in a bid to shore up operations. The company has sold more than $31 million in debt and equity securities since Jan. 1, 2016, to fund operations, the company said in a government filing.

"We continue to execute on our existing backlog, managing working capital, increasing our inventory turnover, improving operating efficiencies, reducing costs, and delivering for our customers," Air Industries' chief executive Luciano "Lou" Melluzzo said in a statement. "Although we were disappointed that the WMI transaction did not close, we continue to focus our efforts on improving our liquidity.”

By Ken Schachter

kenneth.schachter@newsday.comkschach

Ken Schachter covers corporate news, including technology and aerospace, and other business topics for Newsday. He has also worked at The Miami Herald and The Jerusalem Post.