Poor results fail to dent Axis
- 19 December, 2000 10:44
Axis Communications' Australian operation will remain unaffected by the Swedish company's losses according to country manager for Australia and New Zealand, Chris Jefferis.
The hardware manufacturer posted an operating loss of 110.9 million Swedish Krona - about $21 million - for the quarter between May and October this year. The company attributes much of the loss to "the generally weak market for Internet-related consulting services in Sweden during the period", which impacted on its Internet business.
However, Jefferis maintains the company is still operating locally and the poor results will not impact on Australian operations.
"We have had a successful 12-month period - our products have been widely successful and sales have been going extremely well," he said. "I think that growth will continue into next year."
The loss is the result of intensive research and development by the company, particularly in the wireless market, he said, although he could not comment on how long it would take the company to return to profitability.
"The result needs to be read in conjunction with our product releases - we have been announcing a range of new products and developments in the past few months.
"There is no need for us to look at our operating expenses - in isolation our business is profitable and positive. We have very low cost overheads in the Asia-Pacific region and most of the costs are derived out of the hub of our R&D in Sweden."
That new technology centres around Bluetooth - the wireless access technology which Jefferis says is in line to take off in the next 12 months. The company has developed a Bluetooth access point, technology that will allow users to send data directly to a network printer without the need for a PC or enable PDAs wireless access to the Internet.
"We have always had to educate the market and challenge the way people use our technology," Jefferis said. "It takes time, effort and resources to develop and it may lead to circumstances within the company which are not necessarily profitable."
Axis Communications has had ongoing success with its TCP/IP print servers. The posted loss is part of an ongoing cycle, Jefferis said.
"You have to do the background work before you can get to market and create profitability down the path. Axis tends to go through periods of intense profitability and periods of development. It has always been a pioneer in every area of productivity. At the moment we are seeing another technological life cycle. Developing the technology is costly, but the loss is an investment in future profitability."