Hydro Flame Corp. reported a 78 percent increase in net profits in 1988 over the year before because of increased furnace sales and additional revenues from the acquisition of Skyline Industries.

Net sales for 1988 were $25.37 million, compared with $19.55 million in 1987, resulting in net profit of $1.39 million, or $1.43 per share, compared with $779,624, or 75 cents a share.Our core business, the manufacture and sale of furnaces for recreational vehicles, performed strongly throughout the year from an increase in market share, the company said.

But a decline in RV sales and therefore a decline in Hydro Flame growth is expected in 1989, said Chairman Von H. Whitby. The company plans to sell Skyline's steel fabrication business in 1989 because of its incompatibility to fabricating aluminum gas tanks for boats.