Back to business as usual

Welcome to the first issue of Booth`s Bites for 1999. In this issue I have tried to summarise the important happenings since the last issue in early December.

Probably the most significant event during this time has been the on-going battle for control of AirTouch Communications.

Probably the most significant event during this time has been the on-going battle for control of AirTouch Communications. Bell Atlantic, Mannesmann AG, MCI WorldCom, which has now dropped out of contention, the Vodafone Group (UK`s largest mobile-phone company) and British Telecom are all vying for this acquisition, with numbers of up to $60b being banded about. The successful "winner" and its subsequent integration would create an extremely powerful international telecommunications giant.

During the next week or so we will also see a flood of annual results coming through, heralded this year, I suspect, with an ever-growing list of profit warnings, which in many cases means that a loss is being predicted.

• the listings of the Datatec/Primedia initiative "Metropolis", and conglomerate Y3K;
• the announcement of the delay to the listing of call centre specialist Central Information Holdings until early this year;
• excellent maiden results from ITI Technology; and
• the debut by Datatec in the JSE All Share Index and the Industrial Index.

[Local]

• the appointment of the two joint MDs of The Internet Solution, David Frankel and Alon Apteker, to the main board of Dimension Data Holdings;
• the announcement that the MD of Vula Communications had been suspended; and
• the announcement that European anti-virus software developer Panda software has opened a SA branch and signed a distribution agreement with the Pin-Point group.

• the continuing Microsoft trial;
• the battle for Quickturn, with Cadence Design Systems being favoured ahead of Mentor Graphics;
• rumours that PeopleSoft is eyeing the Manugistics Group, but in turn is being eyed by several potential suitors;
• that Cabletron is "up for sale", although this is vehemently denied by the company;
• that CompUSA is also a take-over target;
• that Sybase has cut another 400 jobs since October 1998, in addition to the 800 or so that had been shed earlier in the year;
• that Informix has strengthened its management team by appointing Howard Bain, the CFO at Symantec, as its new CFO;
• that both IBM and Silicon Graphics are interested in acquiring Intergraph;
• Matsushita announced that it was cutting some 2 000 jobs;
• Platinum Software announced it was restructuring following its merger with Dataworks; and
• Oracle and Sun Microsystems seem to be getting very close, and could be cooking up "a Microsoft alternative" from a software perspective. Both CEOs are very anti-Microsoft, and are not short of cash, so anything is possible. Watch this space!

[International]

• the announcements by Compaq, MCI WorldCom and QAD that they will be laying off staff;
• the resignation of the CEO of Cable & Wireless, who has subsequently joined EDS as its new CEO; and
• the announcement by CAD/CAM software house SofTech, that it will lay off 25% of its workforce.

We saw excellent figures from CMG Information Services, Fayrewood, Genesis Microchip, Great Plains Software, Hutchinson Technology, Integrated Systems, MSU, Progress Software, Solectron and Vitesse Semiconductor.

Losses were reported by Advanced Digital Information, Alpha Microsystems, Catalyst Semiconductor, Centigram, CIENA, Credence Systems, Cylink, Dense-Pac Manugistics, Micron Technology, Microsystems, Network-1, ProsoftTraining.com, Quarterdeck, Sand Technology Systems, SofTech, STB Systems, SystemSoft, Tektronix and V3 Semiconductor.

Good numbers were recorded by AmeriQuest, Aspec Technologies, Atos Groupe, Cognos, Computer Services, Geac Computer, InterVoice, Jabil Circuit, Oracle, Plasmon, Racal Electronics, Sage Group and Verity. Printronix reported satisfactory figures.

Mediocre returns came from Acceler8 Technology, Adobe, Datapoint, Electro Scientific Industries, GTech Holdings, Micron Electronics, REMAC, Spring Group Standard Microsystems, Technology Solutions and Volt Information Sciences; while very poor results came from National Semiconductor.

Other financial news included profit warnings from Acer, Adtran, Aehr Test Systems, Anadigics, Applied Microsystems, Artisan, Aspect Telecommunications, Box Hill Systems, Eqifax, Ericsson, Extended Systems, General DataComm, Digi International, Hyperion Solutions, IEC Electronics, IMSI, Inacom, IXC Comms, JDA Software, Natural Microsystems, Network Computing Devices, Pegasystems, QAD, SAP, Spyglass, Storage Technology, Telxon, United Microelectronics World Access and Xaar.

Additionally, Hayes, once a leader in modem manufacturing, is ceasing operations after a long and painful slide. CalComp Technology, the graphics peripheral manufacturer, is also on the way to a shut-down or Chapter 11 bankruptcy proceedings, following the announcement that its majority shareholder, Lockheed Martin, declined to increase its current credit facility.

Locally

Billcad (+81.6%)

ECHold (40.9%)

E-data (+42.4%)

Global Technology (+47.3%)

Infoware (+41.2%)

Ixchange (+50.4%)

Softline (51.4%)

Wentech (-46%)

Whetstone (+69.1%)

Internationally

Acorn (+50.3%)

Adaptec (+47.4%)

AOL (+66.5%)

Banyan (+104.5%)

Bell South (-44.3%)

Broadcom (92.5%)

Business Objects (+60.2%)

CMG International (193.4%)

Cognex (+40.7%)

Corel (75%)

Creative Computers (+59%)

ECI Telecom (+61.3%)

Forte Software (+43.1%)

Geoworks (+68%)

GST Comms (+44.6%)

Hyperion (-39.7%)

Informix (+59%)

Lycos (+68.9%)

Netscape (+66%)

Olicom (44.2%)

S3 (+46.1%)

Trident (+68.5%)

Yahoo (+81%)

Ziff-Davis (+64.7%)

Finally, how things can change in less than 12 months! It was not long ago that the so-called "ERP" market was dominated by Baan, SAP, Manugistics, Peoplesoft and JDA, while JD Edwards was still in private hands. Today, Baan is struggling to recover from a series of financial crises over the past few months, and has called off its joint venture deal with JDA Software, which in turn recently issued a profit warning. SAP has just announced that its latest results will be very disappointing.

Manugistics has announced another loss and is being targeted as an acquisition candidate. Peoplesoft is rumoured to be involved in "take-over talk", while SSA, Marcam Mapics and QAD are still just limping along. JD Edwards has now successfully listed and, together with JBA, seems to be the favoured organisations/products in this market.