DEC weighed in with the works yesterday, reporting a whopping net loss for its fiscal fourth quarter of $256.7m after pre-tax restructuring charges of $400m for its early retirement programme – and analysts say that it has hardly started to make the cuts it needs to make. In what must be the worst performance in its history, net profit for the full year to June 30 plunged 93% to $74.4m, only just keeping it in the black for the year and turnover rose only 2% to $12,942m. Putting a brave face on it, the company says that the results reflect the continuing economic slowdown that affects both US and several other markets. John Smith, senior vice-president of operations and heir presumptive in some books to president Ken Olsen, commented, We have seen good customer response to our new products, including the VAX 9000 series. The company has continued to make significant investments in research and development, capital spending, and our sales and sales support organisations, which are the investments upon which long-term growth is based. The company acknowledges the work to be done, saying that it will continue to focus on revenue growth and on reducing the cost structure. The company is also being hurt by delays in getting the VAX 9000 out in volume, and deliveries in any number are now not likely to start until September, which means a dull first quarter 1991.
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