Last week: AST losses, Motswedi acquisition

Vodafone`s sell-off of its controlling interest in Japan Telecom for over $2 billion dominated the international world of IT and telecommunications last week.

The consolidation in the enterprise resource planning market continues with SSA Global Technologies continuing to eat-up other smaller players.

Paul Booth, MD, Global Research Partners

At home, the losses at AST, the MGX disposals and Motswedi`s acquisition of JMR Software stole much of the local ICT headlines.

* we saw very poor annual results from FrontRange (revenue down but back in the black);

* full-year losses from AST (revenue also down) and OneLogix (revenue marginally down);

* satisfactory interim numbers from AdvTech (revenue just up and back in the black);

* a further profit warning from CS Holdings; and

* OSI de-listed from the JSE.

Other local news included:

* Diego Massidda was appointed as CEO of Tiscali SA;

* the terms of the AST rights offer and consolidation of its shares;

* various disposals by MGX; and

* the first 'reverse` black economic empowerment deal, ie that of Motswedi taking a controlling interest in 'white-owned` JMR Software.

New local distributorships included that of Iomega by Storgate Africa (second distributor).

* we saw the planned name change of Palm to palmOne, when the software division is spun off as PalmSource later this year; and

* the news that Telenor will swap its Moscow telecoms operator, Comincom for a 19.5% stake in Golden Telecom, the Russian fixed-line operator.

Other international news included:

* the appointments of Gary Barnett as interim president and CEO of Aspect Comms, James Bedard as president and CEO of Aberdeen Group, Norman Corn as CEO of Ion Networks, James Jenkins as chairman of Peregrine Systems, Charles Jepson as president and CEO of Extended Systems, Kevin Kennedy as CEO of JDS Uniphase, John Mutch as CEO of Peregrine Systems, Dean Polnerow as CEO of Switchboard, Barry Rand as interim chairman of Aspect Comms, Oscar Rodriguez as CEO of Riverstone Networks and John Wood as CEO of Analogic;

* the resignations of Bernard Gordon as founder and CEO of Analogic (stays on as chairman), Gary Greenfield as CEO of Peregrine Systems, Syrus Madavi as president and COO of JDS Uniphase, Lowell Paxson as vice-chairman of Paxson Comms, Steven Simpson as president and CEO of Extended Systems, and Thomas Willmott as president and CEO of Aberdeen Group;

* the retirement of Jozef Straus as CEO of JDS Uniphase; and

* job loss announcements from HP, IBM, Novell and Sybase.

We saw excellent* figures from Marvell Technology Group (back in the black), OmniVision Technologies, rStar (back in the black) and World Information Technology; and very good* numbers from GlobeTel Comms, Network Appliance, OSI Systems, SCB Computer Technology and Synopsys (back in the black).

Good figures* were recorded by Daktronics, eMagin (back in the black), LaBarge, OPNET Technologies, QAD (back in the black) and Swisscom AG; and satisfactory* ones by Autodesk, BEA Systems, HP (back in the black), Hutchinson Whampoa, KPN NV (back in the black), Photronics and XETA Technologies.

Mediocre* returns came from American Software, Catalyst Semiconductor, Chunghwa Telecom, Dataram (but back in the black), Internet America (but back in the black), Key Tronic (but back in the black), Logility (but back in the black), Neoware, Robocom Systems International (but back in the black) and Serena Software.

Losses* were posted by ADC Telecomms, Agile Software, Agilent Technologies, Allegiance Telecom, Ansoft, Blue Coat Systems, C-Cor.net, Cabletel, Ciena, Claxson Interactive Group, Commtouch, Computer Software Group, Concurrent Computer, Credence Systems, CrossWorlds Systems, Data Systems and Software, DDi, Digital Video Systems, Ditech Comms, eLinear, eNGENUITY, Exabyte, Financial Objects, Formula Systems, Frontline Comms, Hauppauge Digital, I-Sector, ImageWare Systems, Imaging Technologies, Intec Telecom Systems, Intuit, IQE, Lightspan, Matav, MDC Comms International, Nematron, Niku, Novell, Opsware, Portal Software, ProMOS, Qualstar, Rare Medium Group, Storage Computer, Sycamore Networks, Symbian, TiVo, Zoo Digital and Zygo.

Other financial news included share buy-back announcements from Intuit and NTT DoCoMo; an employee stock option exchange programme from Exar; results/profit warnings (often veiled) from ADC Telecomms, ITEX, Sybase, THQ and TTP Comms; share split announcements from InDigiNet (reverse) and Synopsys; a very good IPO from Wistron, the former manufacturing arm of Acer, on the Taiwanese Exchange; and a planned IPO in September by NEC Systems Technologies.

Additionally, Accrue Software and DDi have applied for Chapter 11 protection in order to facilitate the sale of the former and a financial restructuring of the latter; and Crosswave Comms has filed in Japan for court protection from its creditors.

Locally

AST (-26.7%)
Cycad (-25%)
Digicore (+28%)
Edutech (+33.3%)
ERP.com (+16.7%)
I-Solutions (+66.7%)
Labat Africa (-22.6%)
Maxtec (-40%)
Stella Vista (-60%)
Zaptronix (-70%)

Internationally

Computer Software (+45.2%)
Covad Comms (+65%)
Daisytek (+100%)
DDi (-42.9%)
Eagle Broadband (+37.8%)
IQE (+122.4%)
Metron Technology NV (+40.3%)
NCD (-33.3%)
Robocom Systems International (+61.5%)
SEMX (+125%)

In terms of indices, Nasdaq was up 3.7% and the JSE up 3.5% for the week.

The consolidation in the enterprise resource planning market continues with SSA Global Technologies continuing to eat-up other smaller players, the latest one being EXE Technologies, a supply chain execution provider, which happened last week.

It seems SSA`s strategy is to position the SSA product set as its main brand with its host of other products positioned under the SSA banner in specific niched areas. At present, its strategy seems to be working well and has cemented its number four position in this market space. The next few weeks and months could be very interesting to watch!

* 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.