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February 6, 1997updated 05 Sep 2016 12:29pm

BETACOM SEES PROFITS SOAR

By CBR Staff Writer

With Amstrad Plc’s Alan Sugar now in the chair, Betacom Plc’s expansion into consumer products has sent profits and revenue soaring. The Enfield, UK-based onetime telephone set maker, 60%-owned by Amstrad, saw profits leap 391% to 1.3m pounds on revenue that rose 260% to 24.9m pounds. Shares rose five pence at the news, to 30 pence. Betacom suffered in the past from what it describes as British Telecommunications Plc’s use of its monopoly position to lower prices of its telephone handsets so as to squeeze out the competition. The company has therefore diversified its offering with the establishment of a consumer products division, which plans to market small domestic appliances, electronic organizers and calculators, electrical gardening equipment, electrical household tools and health and beauty care products. It will offer ‘famous brand’ products, it says, and in fact is taking all of Amstrad’s consumer products including the brands Amstrad, Fidelity, Sinclair and Integra. In the telecommunications market, the company continued to have a hard time in the rest of Europe, particularly in Germany and France. It says it concentrated on the UK market, where prices remain highly competitive, but improved performance by controlling production costs and broadening its product range with new cordless and pay phones. Sugar took over as chairman of Betacom in November following the resignation of John Samson. He says the company is in the process of recruiting brand managers for the consumer brands, and expects it to achieve its full potential in the next two years. He says that it will only move in to the rest of Europe once it has fully exploited the UK market. The company is now implementing what it calls a conservative but progressive dividend policy, and will start by paying an interim dividend of 0.2 pence.

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