Telecoms acquisitions dominate

The $1.9 billion acquisition of AFC by Tellabs and two other $1 billion+ acquisitions in the telecommunications sector dominated the international world of IT and telecommunications last week.

At home, the various activities associated with CS Holdings and the rural licences recommendation stole much of the local ICT headline space.

* We saw good year-end numbers from Synergy (revenue and earnings both up);

* Satisfactory interim figures from Reunert (revenue slightly down but earnings up) and Sekunjalo (revenue down but attributable earnings up over four times);

* Mediocre interim figures from Spescom (revenue and profit both down a little); and

* Negative trading updates from Faritec and Vesta Technology Holdings.

Other local news included:

* Share re-purchase announcements from Altron;

* The signing of a heads of agreement that enables a 25.1% investment by Thuthukani Information Technology Services in Atio;

* Reunert`s announcement that it will no longer pursue the potential acquisition of CS Holdings;

* The cautionary notices by EOH and UCS expressing the companies` interest in acquiring CS Holdings;

* The resignation of GuruHut co-founder Nigel Bakker;

* Synergy Holdings indicated it would like to move to the AltX; and

* ICASA`s recommendation to the minister of communications for seven of the applicants for the nine underserviced area telecommunications licences.

New local distributorships included that of Cast Iron Systems` Application Router by Cornastone; Marval Service Management by Quintica SA; and Pegasus storage management solutions by Inside Information Systems.

Furthermore, on the local front look out for the outcome of the proposed offer for CS Holdings from EOH or UCS.

* We saw the unexplained announcement that Peter Yip, CEO of chinadotcom, had taken temporary leave of absence;

* Matsushita Electric is set to invest $750 million or more to build the world`s largest plasma display panel factory in Japan;

* HP sold off its 18% shareholding in Australian-based ASG Group; and

* GRIC Comms changed its name to GoRemote.

Additionally, look out for PCCW`s sell-off of its Hong Kong fixed-line operations to China Netcom; some acquisitions by Alcatel; the sale of Information Holdings; and a possible bid for KPN`s mobile business by MMO2.

Other international news included:

* The appointments of Richard Eaton as president of TrueActive Software, Thomas Erickson as CEO of Systinet, Jim Johnson as CEO of Tripwire, Didier Pineau-Valencienne as chairman-designate of Bull, and Richard Schmidt as president of Cybertel Comms; and

* Job loss announcements from Descartes Systems Group, MCI and PinkRoccade NV.

The latest edition of Fortune magazine`s 'Cool Companies` list contains several technology organisations.

Paul Booth, MD, Global Research Partners

We saw excellent* figures from Applied Materials (back in the black), Credence Systems (back in the black), DNO Technologies (back in the black), Information Analysis (back in the black), Marvell Technology Group and Scanner Technologies (back in the black); and very good* numbers from Autodesk, Network Appliance, Niku and Xfone.

Good figures* were recorded by Agilent Technologies (back in the black), BEA Systems, Cimetrix (back in the black), CSC, Datec Group, HP, Merrimac (back in the black), Micromuse (back in the black), MmO2 (back in the black), Photronics (back in the black), Top Image systems (back in the black) and Westell Technologies.

Satisfactory* results were posted by Black Box, British Telecom, Insightful, QAD and Synopsys.

Mediocre* returns came from City Telecom, Docucorp, eBix, GenTek (but back in the black), Indra Sistemas SA, Intuit, Key Components, New Mexico Software, PinkRoccade and SBE; while very poor results* came from Bogen Comms International (but back in the black) and CTI Group (but back in the black).

Losses* were announced by ADC Telecom, AdStar, AESP, Allegiance Telecom, Anacomp, Analytical Surveys, Arel Comms & Software, BakBone Software, Brocade Comms, Ciena, CNT, Cognigen Networks, Comdial, Commtouch Software, Cordia, Covad Comms, Danka Business Systems, Digital Lightwave, Exabyte, FiberMark, Front Porch, Genius, GlobeTel Comms, i2Telecom International, INTAC International, Intelli-Check, Intellisync, Interactive Systems Worldwide, Internet America, iPCS, iTouch, IXYS, JMAR Technologies, Kronos, Leap Wireless International, Marconi, McData, nCipher, NCT Group, NeoMagic, NetWolves, Network-1, NuTech Digital, Nyfix, PPT Vision, Provo International, Reptron Electronics, Sedona, Serena Software, SkyTerra Comms, Storage Computer, Superconductive Components, Teknowledge, TelePlus, Unity Wireless, Vicom, Wind River Systems, WorldQuest Networks, Y3k Secure Enterprise Software and Yell.

Other financial news included analyst upgrades for ADC, SemTech, Serena Software, Triton PCS and Unisys; analyst downgrades for ATMI, Ciena, Intuit, Merix, Nextel Comms, Nokia, Ultratech and Varian Semiconductor; private placement of shares by Commtouch; share offerings from Open Solutions; private funding obtained for Intelligent Results and Zebra Imaging; share buy-back announcements from Business Objects, GoAmerica, Harte-Hanks, Hyperion, Intuit, Network Appliance and Trend Micro; and negative results/profit warnings (often veiled) from Eidos, LogicaCMG, Staktek Holdings and Ultratech; a share split announcement from BakBone Software (reverse 5:1).

There were IPOs filings from Dex Media and e-mail security company, Sybari Software; and a satisfactory IPO from China Telecom; a disappointing IPO from French-based Axalto, the smart card arm spun out of Schlumberger; an IPO delay from Salesforce.com; and a planned IPO from Volterra Semiconductor. Additionally, Bisys is to re-state its results for 2001, 2002, 2003 and part of 2004, and Intelsat has withdrawn its IPO following changes in the Orbit Act.

Locally

Beget (-50%)
Casey (+50%)
Elexir (+50%)
FrontRange (+23.3%)
Global Technology (+100%)
MGX (-12.5%)
Pinnacle (-11.5%)
Prism (-12%)
Synergy (+53.8%)
Vesta (-66.7%)

Internationally

DA Consulting Group (-87.5%)
Eidos (-36.1%)
Firstwave Technologies (+23.8%)
Leap Wireless International (-40%)
Micro Component Technology (+23.5%)
Network Computing Devices (+50%)
RCN (+33.3%)
Scan-Optics (-22.6%)
SCM Microsystems (+21.2%)
SEMX (+41.2%)

In terms of indices, Nasdaq was up 0.4% and the JSE up 4% for the week.

The latest edition of Fortune magazine covers this year`s 'Cool Companies`. The list of 15 contains several technology organisations, including Brightmail (just acquired by Symantec), Ember (semiconductors), iPass (broadband access), Lava Trading Communications, Mositech (security), Office Noa (communications), Securify (security) and Tensilica (semiconductors).

* NB

Guidelines for the categorisation of results are as follows and 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 in excess of 50%.

* Very good: Both revenue and net income growth in excess of 25%.

* Good: Both revenue and net income growth 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.