Xircom Europe NV – the European arm of the Thousand Oaks, California-based remote communications specialist, Xircom Inc – has reported net profit for the six months to 31 March of $613,000, down from $7m in the same period last year. Revenue rose to $83.0m this year from $80.1m for the first six months of last year. It says it has achieved good sales growth on reduced operating expenses over the last two quarters, but concedes that further steps need to be taken to improve profitability. For the quarter, net sales were up 13% from the same period last year to $45.3m. Net profit for the quarter was $1.4m, or $0.07 per share, compared to $2.5m, or $0.15 per share, in the first quarter of 1995. Xircom Europe’s systems division, which includes the ISDN and remote access product lines, contributed 12% of revenue for the six months. The company says that its ISDN business, acquired in June last year, grew 25% compared with the first fiscal quarter. Xircom’s shipments of portable personal computers rose rapidly thanks to improved availability of Pentium-based notebook computers and an increase in mobile computing applications by large companies. But, says Xircom, there has been a downward trend in gross margins, as the proportion of revenue from PC Card products has increased. Gross margin in the second quarter declined 0.5% to 36% for large companies.
