MINNEAPOLIS, Feb. 8 -- Delphax Technologies Inc. today reported that its fiscal 2006 first-quarter sales of printing equipment were the strongest for any single quarter in three years, but were offset by a larger-than-expected decline in service-related revenues. Total net sales for the first quarter ended December 31, 2005 were $12.7 million, a decrease of 2 percent from $13.0 million for the first quarter of fiscal 2005. Fiscal 2006 first-quarter operating income was $257,000, compared with an operating loss of $132,000 for the same period a year ago. After three consecutive profitable quarters, the company reported a first-quarter net loss of $156,000, or $0.02 per share, compared with a net loss of $519,000, or $0.08 per share, for the first quarter of fiscal 2005. Both equipment sales and total sales were up sequentially from the fourth quarter of fiscal 2005. Led by the sale of three of the company's high-speed CR Series digital roll-fed presses, fiscal 2006 first-quarter equipment sales were $2.6 million, up 91 percent from $1.4 million a year earlier and up 174 percent from $1.0 million in the fiscal 2005 fourth quarter. Sales of maintenance, spares and supplies were $10.1 million for the fiscal 2006 first quarter, down 13 percent from $11.6 million for the first quarter of fiscal 2005 and down 14 percent sequentially from $11.7 million for the fourth fiscal quarter of 2005. "The sale of three CR Series presses in a single quarter compares with four CR Series sales in all of fiscal 2005," said Jay Herman, chairman and chief executive officer. "These new placements are further evidence that the industry-leading performance of the CR Series is winning recognition and credibility in the mainstream commercial printing marketplace. The buyers are strategically important customers in the key market segments we are targeting." The major first-quarter equipment sales were: -- A CR2000 press to Muller Martini, a leading manufacturer of print finishing systems. This is the first sale growing out of Muller Martini's selection of the CR2000 to power its new SigmaLine OnDemand book publishing system. The sale followed successful completion of a beta test by a European company. A second SigmaLine system is in test with a prospective North American buyer. -- Two CR1300 presses to a leading publisher of legal analysis and case law documents. These two presses were selected to replace a major competitor's presses on the basis of demonstrated advantages in productivity and improved print-quality. "We were disappointed with the unusual drop-off in revenues from consumables and supplies during the first quarter, but do not believe it will be representative of our full-year performance," Herman said. "The shortfall reflected what we believe to have been a temporary decrease in print production volume on the part of some of our major customers. We expect print volumes to increase towards more typical levels in the second quarter. "As additional CR Series presses go on line and usage builds over time, we expect a solid resumption of overall service-related revenue growth."