Possible bad transformer

Hi,   I've been trying to connect my Lionel 151 semaphore to my 1033, 90 watt transformer and use it with an isolated rail section of track.  When I connect the C terminal to the center terminal of the 151 and the U terminal to the left terminal of the 151, the lamp turns on. Then I connect the right terminal of the 151 to either U or a grounded rail the arm moves.  All these actions are done with the throttle control off.  When I turn the throttle on, the lamp goes out and the arm won't activate.  I've checked voltages and found the 15 volt terminal drops when the throttle is activated.  My question is simply do I have a bad transformer?  Thanks for your assistance.     Bob