Memorex Telex International NV reports that preliminary figures suggest that operating profit for its fiscal fourth quarter to March 31, 1990 was $68.4m, down 13% on the figure for the same period a year ago, but $8.5m ahead of the $59.9m reported for the December quarter. Problem is that the company’s interest payments are estimated at $52m or so a quarter Memorex did not indicate a net figure. Turnover for the quarter fell 5.2% to $533m. The company says that gross margins at 32.7% represented the highest level attained in the past five quarters. Cash flow from operations after interest in the fourth quarter was $42m, not including a welcome tax refund of $65m. The company says that the improvement in margins and cash flow in the second half of fiscal 1990, in particular in the fourth quarter, resulted from measures taken by to reduce costs, enhance operating efficiencies and improve asset management, including inventory and receivables. For the full fiscal, operating profit fell 25.3% to $195m, which suggests that the company just failed to cover interest payments from operating profits for the year; turnover fell 4.3% to $1,980m, but the company puts $47.5m of the fall down to unfavourable currency fluctations. Noting the acquisition of AT&T Co’s 3270 terminal business and Unisys Corp’s disk controller group, Memorex sees itself positioned for growth for fiscal 1991.
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