Unaxis dragged down by IT bust
The Swiss high-tech group, Unaxis, has been hit hard by the decline in the information technology business.
Although the group posted a net profit of SFr111 million ($66.55 million) for 2001, the only thing keeping it out of the red was a one-off sale of assets worth SFr297 million ($178 million).
These included the Pilatus aircraft company, the Leybold Optics Division, real estate sales and other small divestitures.
The most severe downturn in tech sector's 40-year history caused Unaxis to report a SFr211 million operating loss. The company reported a net profit for 2000 of SFr511 million.
"Unaxis was confronted with enormous challenges already in the first year following its new orientation towards information technology," chairman and CEO Willy Kissling told a news conference in Zurich on Monday.
Shift to IT
Unaxis, the former Oerlikon-Bührle conglomerate, decided to concentrate on IT nearly four years ago, divesting among other companies the Bally shoes and accessories concern.
The group is now concentrating its efforts on the semi-conductor markets and technology for production systems of CDs, DVDs and flat TFT screens for both computers and televisions.
More than one third of all hard disks, two-thirds of all CDs and CD-ROMs, and more than 80 per cent of all rewriteable CDs, DVDs and Minidisks are produced by systems made by Unaxis.
Commenting on the decline in the IT markets, chief operating officer Heinz Kundert told swissinfo that it was cyclically related.
"Those kinds of declines are regular phenomena that occur every couple of years so we have to prepare the company by increasing our flexibility, keeping our fixed assets low and building up a very strong supplier network," he said.
The company said that in addition to overcapacity and high inventory levels, it had also been hit by a general drop in demand for finished goods in its customers' markets.
The year 2001 was also the first in a long time in which there was a decline in sales of electronic equipment such as computers and mobile phones.
In the face of market uncertainties, Unaxis is being cautious in its outlook for the future.
"From today's vantage point, Unaxis is going on the assumption that a recovery in the IT business will set in only towards the end of this year," Kissling said.
He said the current first quarter order intake and sales had been below expectations and forecast that sales for the whole of 2002 would not reach the 2001 level.
"While numerous uncertainties are attached to current forecasts of when the next recovery may set in, one thing is for sure: the fundamental growth trends of the IT industry - the processing, storage, communication and visualisation of information - remain intact," Kissling added.
In a separate presentation, the semi-conductor systems business ESEC, in which Unaxis has a controlling stake, reported a net loss of SFr92 million for 2001, down from a profit of SFr156 million the previous year.
The company has appointed Jürgen Knorr as CEO, after Felix Bagdasaranz reportedly quit by mutual agreement with the board after a dispute over strategy.
by Robert Brookes
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