German govt assists MobilCom

The MobilCom bailout by the German government and another re-statement of WorldCom`s financial figures dominated the international world of IT and telecommunications last week.

Look out for further sell-offs by European telecoms companies in order to reduce their debt burdens.

Paul Booth, MD, Global Research Partners

At home, the raft of local results stole much of the local ICT media headline space.

• we saw excellent year-end figures from ERP.com (revenue and profit both well up);
• good full-year numbers from Pinnacle Technology Holdings (profits up over six times) and WebSoft (turnover and EBITDA both well up);
• mediocre annual figures from Digicore (revenue and profit both down and margins squeezed); and
• full-year losses from Comparex (revenue static) and Systems Publishers.

[Local]

Other local news included:

• the sell-off by Kagiso Media of its stake in Systems Publishers (as from 26 June);
• the departure of Hayden Saulez, marketing and sales director of BMT-TechKnowledge, along with several other staff members; and
• a deal by Venfin with Merrill Lynch that will enable it to acquire the 5% holding of Vodacom currently held by Hosken Consolidated Investments.

• we saw the announcement of a $388 million bailout package by the German government for MobilCom AG;
• the closure of General Magic, a pioneer in voice application software and services; and
• Previo shareholders approved its dissolution.

Additionally, look out for further sell-offs by European telecoms companies in order to reduce their debt burdens.

[International]

Other international news included:

• the appointments of Kevin Mooney as CEO of Broadwing, John Simon as president and CEO of AfterBOT, and Eugene Wong as CEO of Versata;
• the resignations of Steven Elbaum, CEO of Superior Telecom; Richard Ellenberger, CEO of Broadwing; John McGuire as president of Trintech Group; and James Mooney, COO of Nextel Comms; and
• job loss announcements from Adaptec, Alcatel Optronics, Alcatel SA, Avici, Cable & Wireless, Deutsche Telecom, Diagonal, GigaMedia, MobilCom AG, Nokia, SAP, Verity and WorldCom.

We saw excellent figures from Forgent Networks.

Good numbers were recorded by California Amplifier, DPAC Technologies, Global Payments (back in the black), NDCHealth, Proginet (back in the black) and Sirius Financial Solutions.

Satisfactory figures were posted by EMJ Data Systems, Financial Models (back in the black), Paychex, Progress Software and SAIC.

Mediocre returns came from Bonso Electronics, Jabil Circuit, Oracle and Tektronix; while very poor results came from Dicom Group, ESI, Spectrum Control and Standard Microsystems.

Losses were announced by 3Com, AimGlobal, Cintech Solutions, Compel Group, Gilat Satellite Networks, Infinite Graphics, Infogrames, Merkantildata AS, Merix, Navtech, Optical Cables, Powerlan, Red Hat, Riverstone Networks, Saba Software, SofTech, Switchboard and Tibco Software.

Other financial news included a share buy-back announcement from Actel, AlphaNet Solutions, Avici and Manhattan Associates; and profit warnings from Adaptec, Alcatel Optronics, Alcatel SA, Atmel, Belden, C-Cor.net, Cable & Wireless, Celestica, Certegy, Chartered Semiconductor, Ciena, Diagonal, EDS, Euronet, Infineon Technologies, ITXC, JDA Software, NEC, Oracle, Philips Electronics, Printronix, Sento, Spectrian, Trimble, TriQuint Semiconductor and Xansa.

There were share split announcements from Avici, Commerce One and CoSine Comms; an IPO filing by Spectra Systems, a systems specialist; a disappointing IPO from NEC Fielding, a services company spun-off from NEC; a withdrawn IPO from Accpac International (part of Computer Associates); and an IPO announcement from China Unicom, the second largest mobile phone operator in that country and the second largest ever IPO to be offered in that domestic market.

Additionally, Global Crossing has set out details of how it will emerge from Chapter 11 through its deals with Hutchison Whampoa and Singapore Telecom, and if the plan is accepted, will operate in its new form from about the end of October; Cambrian Comms has filed for reorganisation under Chapter 11; and WorldCom is set to re-state its financial accounts by more than $2 billion.

Locally

AST (-12.8%)
Dimension Data (-11.9%)
Elexir (+100%)
ERP.com (+18.4%)
Global Technology (-18.2%)
Idion (+22.2%)
Labat Africa (+20%)
MGX (-14.7%)
Stella Vista (-12.5%)
Synergy (-25%)

Internationally

Actuate (-43.2%)
DDi (-50%)
EDS (-54.3%)
eGain (-38.1%)
JDA Software (-46%)
PCD (-47.1%)
Pivotal (-36.6%)
Rural Cellular (-37.8%)
SLR (-39.4%)
Xansa (-50.3%)

Connexity`s Age of Innovation awards function took place in Sandton last Tuesday and recognised many new and relatively unknown local companies that had shown creativity, entrepreneurship and 'beyond-the-box` thinking. Although in past years the finalists have all been IT-oriented, this year the scope was widened and the top prize was scooped by CIDA City Campus, a new learning institution that aims to make high-quality education available to disadvantaged students in SA.