Datacraft misses forecasts
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SINGAPORE, (Reuters) -- Southeast Asia's biggest computer data network builder, Datacraft Asia, has reported a weaker-than-expected quarterly profit.
That comes despite aggressive cost cuts and a pickup in technology spending.
Like its big U.S. rivals Hewlett Packard and IBM, Datacraft was given a boost in the quarter by strong U.S. capital spending. Its December quarter profit compared with a loss a year earlier.
But net earnings at the Singapore-based company, which builds and maintains computer networks for banks, telecom companies and technology firms, fell significantly short of market forecasts.
After a loss of $2.53 million in the year-earlier quarter, Datacraft swung to a profit of $57,000 for the three months to December 31, it said Wednesday.
That was below the $600,000-$2.2 million profit forecast by three analysts surveyed by Reuters.
Quarterly revenue grew 2.5 percent to $88.0 million.
"The results tell you that the dynamics of Datacraft's industry remain very difficult -- it is still facing intense competition," said Netresearch-Asia analyst Russell Tan.
"If a 2.5 percent rise in revenues is all you can achieve while the U.S. economy is in the throes of a stimulus-induced recovery, then things could be quite horrible this year when all the favorable factors are expected to reverse as global interest rates rise," he said.
Datacraft's outlook has been clouded somewhat by an investigation into the company by Singapore's white-collar crime unit, the Commercial Affairs Department, since August 2002.
Details of the probe have not been released. But Datacraft Chairman Patrick Quarmby has said the company had conducted its own probe of share sales in 2001 by two directors and was satisfied there was "nothing untoward" in their actions.
Datacraft, a unit of South African technology group Dimension Data, said excluding goodwill amortization of $942,000 from a South Korean acquisition, the company posted a pre-tax operating profit of $1.91 million.
Copyright 2004
Reuters. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
