Last Call: TurboChef sinks as 1Q results miss estimates

Late Wednesday, the Atlanta-based company said its loss shrank to $4.3 million, or 15 cents per share, from $4.9 million, or 17 cents per share, in the first quarter of 2007. Revenue rose 34 percent to $24.5 million from $18.3 million, as product sales grew 35 percent to $24.2 million.

However, the two analysts reporting to Thomson Financial expected a much smaller loss of 6 cents per share on higher sales of $28.2 million.

TurboChef shares dropped $1.32, or 17 percent, to $6.52 in afternoon trading. The company also said it has initiated spending cuts and employee layoffs, most of which will take place in the second half of the year. TurboChef plans to take a $1.4 million restructuring charge in the second quarter.

The company said it still expects to become profitable in 2008. Analysts expect it to turn a profit in the third and fourth quarters, and finish with net income of 23 cents per share for the year.

Merriman Curhan Ford analyst Robert Straus said the company's general expenses were greater than expected, due to increased residential spending and the cost of defending patients.

He said TurboChef is a buyout target, because it would offer a buyer improved technological knowledge, diversity of products and the chance to reach new customers.