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November 24, 1993

KEWILL BACK ON TRACK WITH UKP1.8m PRE-TAX

By CBR Staff Writer

Kewill Systems Plc is back in black after taking the hit to get rid of Weigang MCS, the German subsidiary that proved too heavy to carry this year. At the time Kewill said it was getting back on track for the future, after taking a UKP2.3m hit for liabilities when it sold the business in June (CI No 2,196), along with a goodwill write-down of UKP5.6m. It looks as if it’s making good on that promise, posting pre-tax profits of UKP1.8m against losses of UKP172,000 last interim, on turnover up 3.8% to UKP16.0m. The group says it will recommend a full dividend payment at the end of the fiscal year. Business in Europe is putting the pressure on Kewill, although the group is pointing to the US as a release valve – indeed, the US-based management team has doubled operating profit to UKP450,000. Kewill is divided into three business areas – manufacturing systems contains the companies Micross, Trifid and Xetal in the UK which provide manufacturing systems for the personal computer, mid-range and garment manufacturing markets, while Micromax caters for the US market and is rolling out a Windows-based version of the product in the next 15 months. The Kewill-Xetal Consultancy unit signed its first international contracts in Spain recently. The accountancy division consists of the traditional Omicron product and the higher end XIS, while a new product, Dynamics, is being developed for the US-based mid-range market. Also in the accountancy division, the Electronic Data Interchange venture, operated mainly out of the Xetal company, is signing more contracts and is moving into the public sector. The final division, CAD, contains HAN Dataport, which focuses on the German-speaking regions of Europe. This company experienced flat operating profits. Under normal circumstances, profits would have increased but the large contract signed last year with the Deutsche Bundespost Bundespost, which looked likely to provide sales of over 50 workstations this year as it did last, was depressed due to the delegation of buying decisions to regional Bundespost offices and the flat economy. HAN is hoping for increased sales through its recent deal with IBM Corp, under which the latter will sell the HAN Dataport CAD 400 BAU product on the RS/6000. IBM Europe has apparently said that if the partnership works well, then it will market the product outside Germany. The Kewill group as a whole cut its borrowings to UKP2.8m from UKP3.9m at the end of its last fiscal year.

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