Newbridge Networks has recorded a C$18.3 million (#7.7 million) loss for fiscal 1998, although the firm's quarterly result is up for the first time in a year.
Newbridge also re-jigged top management and hired a new president and chief operating officer, ex-Compaq man Alan Lutz, in an effort to improve the financial picture. Lutz succeeds Peter Charbonneau, who will become vice chairman.
Net earnings for the year nose-dived from C$156.9 million (#65.9 million) last year to a loss of C$18.3 million (#7.7 million), but for the quarter the company recovered, rising from a loss of C$29.7 million (#12.5 million) to a C$3.6 million (#1.5 million) profit.
Dataquest analyst Ian Keene said the overall results were good. "The company is 10% up on the quarter and I couldn't expect much better than that," he said. "However, looking back you have got to really question some of the acquisitions Newbridge has made. The companies it bought have not provided the path into new market sectors that Newbridge hoped for."
The company disagreed. "Recent acquisitions have provided absolutely the right paths to new markets we hoped for," a spokeswoman said.
"UB was not performing very well when we bought it from Tandem, and the cost of integration into Newbridge Networks brought quite a few surprises," she went on. "But we have written off the cost of even our most recent acquisition - Radnet, which we bought at the beginning of this year - and we feel that this quarter's result demonstrates a definite upward trend."
Dataquest's Keene agreed. "Providing the Siemens, Newbridge and 3Com alliance continues to hold, then this group of companies should remain a major player in the telecoms market in the future," he commented.
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