IBM Espana SA’s figures for 1991 are now out, and show a 16.2% drop in net profit for the year, to the equivalent of $169m. Figures include IBM Espana, IBM Leasing Information and IBM Espana Distribuidora de Productos. The local financial director attributes the fall in profits to the change in the depreciation criteria used by IBM and, in particular, to the reduction in sales margins because of fierce competition. Though profits were disappointing, there was a 20.9% increase in turnover to $2,405m, of which $758m was derived from exports – a $68.5% increase on 1990, which IBM says is due to export from the company’s plant in Valencia which this year started producing 10 models of the ES/9221 systems range in addition to its main product, the ES/9121. Domestic sales, meanwhile, increased just 7% to $1,647m. The company also reported a 70% growth in high-range systems and services, while noting that hardware business has not been overly healthy. The last year also saw 300 people depart the company, leaving a total 4,561 employees. As per IBM’s group policy, the cuts were implemented under an early retirement plan. IBM Espana invested $94m in 1991, a figure expected to be maintained in the current year. IBM sources have told the Spanish press that 1992 is full of unknown factors and that the company’s growth will depend on how the economy develops. Joaquin Moya, managing director of IBM Espana, says the 7% increase in domestic sales is good when set aside the fact that the overall figure figure for information technology growth in Spain is likely to come out at between 0% and 1%.
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