Network and desktop integration company Wang Global Inc has reported huge losses for the fourth quarter and year, after recording a slew of on-time charges mostly related to its acquisition of Inc C Olivetti SpA’s Olsy services business in March (CI No 3,359). The loss for the fourth quarter was $260.5m on revenue that jumped to $833.3m, an increase of nearly 150% year-over-year. Charges for the quarter include $74.1m write-off of in-process research and development connected to the acquisition, a $134.8m reduction in the carrying value of previously acquired intangible assets, $25.8m in integration and restructuring expense and $16.1m in other operating charges. The company also recorded $18.8m of amortization related to the acquisition, which it said was $14.6m higher than originally anticipated. Charges and accelerated amortization aside, Wang would have seen earnings of $0.03 per share, while analysts surveyed by First Call were looking for a loss of $0.04 per share. For the year, net loss was $281.6m on revenue up 48.8% at $1.89bn, against net income of $69.9m, or $1.50 per share last year. Charges for the full-year period amounted to $306.4m, while the comparable period last year saw charges totaling $52.5m. Wang says it is still on track to achieve its goal of $150m – $200m in cost reduction and to generate more than $300m in EBITDA in calendar 1999. To that end, the company has already cut 1,450 jobs out of the 2,300 planned for this calendar year and 3,100 overall by the end of 1999. It also has plans to eliminate 2.5 million square feet of office and warehouse space, of which it has already off-loaded 800,000 square feet. Wang claims to have seen results from these actions already, with gross margins for the quarter up to 20%. Wang has also announced that it will be changing its fiscal year end to from June 30 to December 31. Results for the six-month transition period will be reported in a separate filing at the end of the year.
