Acorn Computer Group Plc accompanied year-end figures showing a loss of ú3.4m with a ú17m cash call to shareholders by way of a one-for-three rights issue of 22.5m shares at 80 pence each. The company intends to use the ú17.2m net proceeds mainly to fund its Online Media division, which is involved in the recently-launched second phase of that interactive television trial in Cambridge, and required expenditure of ú1.8m in 1994. Acorn’s principle shareholder, Ing C Olivetti & Co SpA, will not be taking up its entitlement in the issue. The Italian company’s shares will be placed with institutional shareholders, reducing Olivetti’s stake to 58.9% from 78.5%. The balance of the proceeds will be used for the core business, Acorn Computers Ltd. This part of the business had another difficult year in 1994. It saw increased sales of its RISC personal computer line and good progress in Australia and New Zealand offset by a decline in sales to UK primary schools, resulting in an operating loss, excluding Online Media, of ú1.3m. Acorn Computers plans to release a low-cost board in April to enable its RISC personal computers to run applications for RISC OS, Windows and MS-DOS, concurrently if required. The division is having to reduce its costs still further, and a restructuring provision of ú980,000 has been charged to the group’s results. Advanced RISC Machines Ltd, on the other hand, had another successful year. The division, in which Acorn has a 43% stake, doubled its headcount and saw pre-tax profits rise more than seven-fold, to ú1.8m. It also opened offices in the US and Japan. Online Media, formed in April 1994, will require further significant investment, as the directors do not envisage large scale exploitation of the interactive multimedia market until 1997 at the ea rliest. Online Media has been selected by Northern Telecom Ltd as its preferred supplier of television set-top boxes for trials in the UK and the rest of Europe. However, the company warns of what it sees as the considerable risks of Acorn’s proposed entry into this market. Acorn plans to transfer ú19.2m from its share premium account to eliminate losses and enable it to pay a dividend at a later stage. The Cambridge-based group paid no dividend this time.
