Acorn Computer Group Plc appears to have hit the rocks at the interim stage and it is unclear as yet whether it will be able to continue on course unaided. It reported a very small pre-tax profit of UKP42,000 which is 98% below its year ago performance on revenues flat at UKP22m. There are one or two circumstances that offer a small apology for the performance, though whether they can be described as mitigating only time will tell. First of all this time last year Acorn’s profits were boosted by a UKP1.2m research and development fund from Olivetti Systems & Networks which makes the fall from grace appear longer than it might otherwise have done – although even if this sum is subtracted from 1989’s interim figures, profits have still slumped by 95%. Secondly, Acorn has had to write off its UKP284,000 holding in Torus Group Ltd which went into receivership in July. This is entered, reasonably enough, as an extraordinary loss. However, far more worrying in terms of Acorn’s future prospects is the fact that interest charges on borrowings wiped out the group’s profits before the extraordinary item was entered. Nevertheless, company chairman Sam Wauchope is putting on a brave face believing that tightly controlled overheads, high quality products, and the maintenance of investment in product, sales channels and staff enable Acorn to face the future with confidence.
