London-based handheld computer and networking equipment manufacturer Psion PLC showed a huge drop in pre-tax profits for the first half of the fiscal year, which ended on June 30, citing poor sales of its computers.
Psion reported revenues of 64.2 million pounds ($US103.1 million), down 10.1 million pounds from the first half of 1998, and pre-tax income of 100,000 pounds, down from 4.1 million in the first half of 1998, in its financial results released on Thursday.
Palmtop sales fell 34 per cent in the first half, in part because of decreasing demand for the Series 5. The company expects its second half results to be stronger because of new products, including the Series 5mx and Series 7.
Regionally, North America was the only market showing an increase in sales, with 8.1 million pounds, up from 5.9 million. Sales in the UK dropped from 31.5 million pounds in 1998 to 22.3 million pounds, and sales in Europe dropped from 33.2 million pounds in the first half of 1998 to 30 million pounds for the first half of this fiscal year.
Psion also claimed that its ongoing investment in the Symbian joint venture with Motorola, Ericsson, Nokia and Matsushita would continue to constrain its short-term profitability, according to chief executive David Levin. Symbian is developing the EPOC operating system for what the companies hope will be a standard in next-generation mobile devices.
In the second quarter, Matsushita purchased an 8.8 per cent stake in Symbian for 22 million pounds, bringing Psion's share to 28.1 per cent. Symbian also purchased two software companies during the first half of the fiscal year, increasing its number of employees to 338.
The venture is expected to move into profitability in the fourth quarter of 2001, according to Psion.