Softline saga sees third bidder

The Australian government`s announcement re Telstra and the French government`s announcement re Bull dominated the international world of IT and telecommunications last week.

Sage`s last take-over was earlier this year when it acquired France-based Concept Group.

Paul Booth, MD, Global Research Partners

At home, the Global Technology news and the entry of a third bidder for Softline stole much of the ICT local headline space.

* we saw good year-end numbers from RAH (back in the black) and Telkom SA (revenue and net profit both up);

* mediocre annual numbers from Johnnic Comms (although digital interests are performing well); and

* an annotation of the listings of Square One and Y3K following an emphasis of matter highlighted by the auditors on the annual financial statements.

Other local news included:

* a share re-purchase announcement from Mustek;

* the resignation of Ray Leonard, CEO of Global Technology;

* the appointments of Terry Kier as MD of Masterskill, Anna Mokgokong as non-executive chairman of Jasco, Mavuso Msimang as CEO of SITA, and Graeme Victor as CEO of Global Technology;

* Glotec`s 'disputed` pull-out of its interest in its Australian subsidiary and sell-off of its local banking division and the associated parts of its professional services division to a consortium headed by Ray Leonard;

* CPG (ex-Arrow Altech and now with Sahara) changed its name to Annex Distribution;

* a delay in the procedures for AST`s re-capitalisation;

* a plan to create an ICT empowerment charter; and

* Sage became the third contender for Softline.

Sage is no stranger to the world of acquisitions, having made several over the past two to three years, including some major brands such as the customer relationship management product SalesLogix. Its last take-over was earlier this year when it acquired France-based Concept Group. Sage`s portfolio of product brands includes ACT, Best, FAS, MAS and Peachtree. In its last full-year, Sage`s revenue approached the $1 billion mark with a healthy bottom line and plenty of cash in the bank.

New local distributorships included that of Duxberry Networking for Clearswift`s product suite.

Additionally, SA should see a new search engine, SusySearch, launched shortly; and Cape Town-based Qeo Wireless has developed a local 'smart phone`, which should be available for testing in Q3.

* PNC Telecom`s shares were suspended on London`s AIM;

* Pomeroy Computer Resources changed its name to Pomeroy IT Solutions; and

* the revival of the Australian government`s plans to sell-off the remaining 50.1% of Telstra.

Additionally, look out for changes at Bull following the French government`s decision that it would no longer be a stakeholder or provide guarantees once the financial restructuring is complete.

Other international news included:

* the appointments of Steven Garman as president and CEO of QI Systems and Michael Lambert as chairman of Vignette;

* the resignations of Douglas Bartek as chairman and CEO of Microtune, and Tom St Dennis as president and CEO of Wind River Systems; and

* job loss announcements from Corel, Getronics, Sony Ericsson, Tech Data, Telefonica and Vodafone.

We saw excellent* figures from ISoft; and very good* numbers from Computerland and Datatec Systems (back in the black).

Good figures* were recorded by Methode Electronics (back in the black), Salesforce.com (back in the black), SI Technologies and Verity; and satisfactory* ones by ATI (back in the black), CSI, ePlus, InterVoice (back in the black), Paychex and Seagull (back in the black).

Mediocre* returns came from Lawson Software, Tektronix, Vtech, Wilshaw and Xansa.

Losses* were reported by 3Com, Angoss, Barrister, Bonso Electronics, Business Systems Group, Corel, FSI International, GX Networks, Interland, Kuju, LML Payment Systems, Manugistics, MCK Comms, Nexus Telocation, Northgate Information Solutions, Palm, Research In Motion, Shaw Comms and Stratos Lightwave.

Other financial news included share buy-back announcements from Chunghwa Telecom, Lawson Software and Trend Micro; a convertible bond issue from Cap Gemini; results/profit warnings (often veiled) from AMD, Anixter International, Concurrent Computer, Eidos, InFocus, Kana Software and Snap-on; a share split announcements from Interland (reverse) and Seiko Epson`s very good IPO on the Tokyo stock exchange.

Locally

Beget (-12.5%)
Digicor (+11.5%)
EOH (+11.9%)
Faritec (-15.4%)
Global Technology (-16.7%)
Idion (+17.3%)
Infowave (-14.3%)
Set Point (-13.3%)
Softline (+11.6%)
Trematon (+56.3%)

Internationally

All American Semiconductor (+30%)
ClickSoftware (+59.5%)
Dice (-67.7%)
Enherent (-36.4%)
NCD (-38.1%)
On2 Technologies (+66.7%)
PSC (-28.6%)
PCD (-40%)
Read-Rite (-50%)
Robocom Systems International (+44%)

In terms of indices, Nasdaq was 1.2% down and the JSE 5.4% down for the week.

The announcement of the JSE`s new alternative exchange, which will be launched in October, may attract many of the technology listings on the main board that do not meet the current listing requirements - there are many companies that fall into this category - as well as those listed in the DC and VC sectors. This new exciting development is well worth watching and could stem the flood of de-listings that are now happening.

* 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.