Black empowerment moves

Two acquisitions by Cisco and the link between EDS and NTT Comms dominated the international world of IT and telecommunications last week.

CeBIT, the world`s largest electronics trade fair, has come and gone for 2003.

Paul Booth, MD, Global Research Partners

At home, the Casey/Ndizani merger and the creation of TSS Managed Services stole much of the limited local ICT space.

• The JSE has annotated Spescom`s shares until an audit 'emphasis of matter` in its annual financial statements had been clarified and resolved.

Other local news included:

• the announcement that the operations of Casey and Ndizani Technology Holdings are to be merged in a move driven by Blitec (Black Information Technology Company), a black economic empowerment (BEE) company that is Casey`s majority shareholder;
• Connie Molusi was appointed as CEO of Johnnic Comms;
• there were several changes to the I-Solutions board;
• the termination of the distribution agreement between Logitech and Workgroup; and
• the creation of TSS Managed Services, a new BEE company formed from Tactical Data Systems` networking business unit and NDS`s Specialised Services unit.

Furthermore, the Nigerian government has handed over control of Nitel to a Dutch telecoms consultancy, Pentascope International, for a three-year period, with a view to a subsequent initial public offering.

• IFX announced that it intends to go private;
• NTT Comms and EDS are joining hands in order to provide global IT and communications services; and
• the finalisation of Marconi`s long-awaited debt restructuring.

Additionally, look out for the joint venture being formed by 3Com and China`s Huawei, in a move that could challenge Cisco; the purchaser for Vivendi`s Maroc Telecom stake (35%); and Getronics` sell-off of its non-core assets, in a bid to clear some of its massive debt.

Other international news included:

• the appointments of Gary Ampulski as president and CEO of Workflow Management, Doug Dickerson as CEO of Cyneta Networks, Robert Dotson as president and CEO of T-Mobile USA, James DiLorenzo as president and CEO of Paratek Microwave, Gary Forsee as CEO of Sprint, Jeffrey Heller as president and COO of EDS, Dennis Hoffman as CEO of Storigen Systems, Michael Jordan as chairman and CEO of EDS, Martin Kern as acting-CEO of Global Payment Technologies, Toshikazu Koike as CEO of Brother, Marty Leestma as president and CEO of Retek, David Lockwood as chairman and CEO of Liberate Technologies, Rene Sagastuy as CEO of Maxcom Telecomms and Paul Twomey as president and CEO of ICANN;
• the resignations of Dick Brown as chairman and CEO of EDS, Hideo Kageyama as CEO of Brother (stays on as chairman), Stephen Katz as CEO of Global Payment Technologies, Kenneth Koppel as president of PC Connection, and Steve Ladwig, president and CEO of Retek;
• the retirement of Stuart Lynn, president and CEO of ICANN; and
• job loss announcements from Alcatel, Applied Material, August Technology, Gateway, JDA Software and Solectron.

We saw very good* numbers from Jabil Circuit, Knology (back in the black), Nexor and Wireless Telecom Group (back in the black).

Good figures* were recorded by Artemis International Solutions (back in the black), China Mobile (Hong Kong), Delcam, Glentel, Hutchison Whampoa, Paychex, Progress Software, Turkcell (back in the black) and Univision Comms.

Satisfactory* figures were posted by ADVA Optical Networking AG (back in the black), Aladdin Systems, Entegris (back in the black), Global Payments, Harvey Electronics, Oracle and Peerless Systems (back in the black).

Mediocre* returns came from Elevon, Gensym, OnX Enterprise Solutions, Paragon Technologies, Tibco Software and Wegener; while very poor results* came from Datatec Systems (but back in the black - just), Infinite Graphics, RF Monolithics (but back in the black) and Spectrum Control (but back in the black).

Losses* came from 3Com, ATI Technologies, BATM Advanced Comms, Baltimore Technologies, Camtek, Cellular Technical Services, Centennial Comms, Data Translation, Digex, Emblaze Systems, ESI, FSI International, itelligence AG, inTEST, Intraware, ION Networks, LanOptics, Lawson Software, Metatec, MicroHelix, Micron Technology, NaviSite, NDCHealth, Palm, ParkerVision, PCCW, Plaut AG, Procom Technology, Programmer`s Paradise, Remec, Saba Software, Solectron, SONICblue, Taitron Components, Tech Data, Tektronix, Troy Group, UBICS and VIA NET.WORKS.

Other financial news included share buy-back announcements from BEA Systems, Cisco, Kronos, PDF Solutions, QAD and Teledyne; shareholders rights plans from Euronet Worldwide; results/profit warnings from Concurrent Computer, Insight Enterprises, Intuit, Marconi, Microchip Technology, Oracle, PEC Solutions, Pioneer-Standard, Plexus, Power-One and Touchstone; and a share split announcement from IFX (reverse). Additionally, Loudeye has put its reverse stock split on hold; Evolve Software, PCD and SONICblue have filed for Chapter 11 protection; and Veritas is again re-stating its 2000 and 2001 results.

Locally

Aqua Online (-16.7%)
Cycad (-33.3%)
Intervid (-9.1%)
IST (+20%)
MGX (-20%)
Spescom (-20%)
Stella Vista (+100%)
UCS (+9.1%)
Vesta Technology (+150%)
Y3K (+100%)

Internationally

CNET Networks (+34.9%)
CT Comms (+34.9%)
Getronics (-39.1%)
I-Many (+35.1%)
Invensys (+41.5%)
Microtune (+78.2%)
PCD (+36.4%)
PSC (+66.7%)
SBA Comms (+106.3%)
SONICblue (-75%)

CeBIT, the world`s largest electronics trade fair, has come and gone for 2003. As was expected, the number of exhibitors and visitors was well down on 2002, and is very much in-line with the happenings at the other major shows, eg Comdex, in 2002. The major theme seemed to be mobility, with Wi-Fi, 3G and Bluetooth technologies having significant visibility, and hopefully, I am assured, a dominant role in business over the coming months.

* NB

Guidelines for the categorisation of results are as follows. The figures are always in comparison with the equivalent period for the previous year; pro forma numbers are ignored (the terminology may vary slightly from country to country).

* Excellent: Both revenue and net income growth are in excess of 50%.
* Good: Both revenue and net income growth are in excess of 10%.
* Satisfactory: Revenue is within 10% of previous year and net income is up.
* Mediocre: Either revenue and/or net income is down.
* Very poor: Net income is less than 1% of revenue.
* Loss: A loss has been recorded.