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Ascom announces losses of almost SFr400 million

Ascom has forecast lower revenues for 2002

(swissinfo.ch)

The Bern-based technology group, Ascom, has announced losses of SFr395.5 million for 2001, compared with profits of SFr67 million the previous year.

The losses were more substantial than analysts had anticipated. Ascom had been expected to post a loss of some SFr341 million because of restructuring costs and a loss-making disposal. But costs had been higher than anticipated and Ascom had suffered as a result of the economic slowdown in 2002, a company statement said.

"[The loss] was due to a slump in markets, the resulting pressure on margins and costs that were too high," the statement said.

Revenues were similar to 2001, remaining steady at SFr3.14 billion.

Ascom reduced debts to SFr631 million by the end of 2001, from SFr669 million in June 2001. But due to a fall in shareholders funds, debt rose to SFr122 per cent of equity compared with 48.8 per cent in the previous year. Ascom said it would not pay a dividend in 2001.

The company said it planned a refinancing by October and was studying ways of boosting shareholders' equity.

Little improvement

Ascom said it saw no sign of recovery in its markets yet but expected a slight recovery in the second half of the year.

For the first half of 2002, Ascom expected slightly lower revenues for its four core divisions, positive earnings before interest, taxes, depreciation and amortisation (EBITDA) but a negative operating result, according to the statement.

Restructuring frenzy

The Ascom group was founded in 1983 from a merger of regional telecommunications and radio communications businesses, including Autophon, Hasler and Zellweger.

In the early years, the company underwent several major restructurings, leading to frequent changes at management level.

Ascom has still not fully recovered from an aggressive overseas expansion drive in the nineties, which resulted in a heavy debt burden and lead the company to the verge of collapse.

Most recently, the company said it would refocus its core businesses and it agreed to sell its cash-handling activities in Switzerland, its terminals business, mailing systems and carrier access. The company also announced in June it planned to cut 1,100 jobs, 400 of them in Switzerland. As of January, 1,033 jobs altogether, had gone.

"Ascom is on course for its planned divestments ...It would simply not have been responsible to wait for mergers and acquisitions times in order to achieve possibly more favourable sales conditions," Chairman Fred Ruessli said in a statement.

The two main shareholders are the heirs of investor Ernst Müller-Möhl (20 per cent) and the Hasler Foundation (17 per cent).

swissinfo with agencies


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