View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Technology
June 4, 1997updated 05 Sep 2016 12:47pm

RACAL SEEKS PARTNERS AFTER PROFITS SLUMP

By CBR Staff Writer

Troubled Racal Electronics Plc is seeking a strategic partner for its telecommunications business and advisers are looking at merger options for its data productions division, the company revealed yesterday. This comes after a year when profits slumped after the group had to absorb the 29m pound costs of a fundamental reorganization of its Data Products division. At the pre-tax level, profits fell from 70.4 pounds to 40.4m pounds though revenues rose 14% to 1.138bn. The company says that reorganization of data products is now complete and its operating loss for the year was 19.1m pounds, 5.5m pounds down on the previous year’s figure. It is confident it can compete in the market for multimedia communications systems, which is growing at 25% a year. New products are being introduced though the company says that increased sales and profits margins are unlikely before the second half of the current year. But in order to ensure that shareholders get the best value from this business, the board says that they are being advised by merger and acquisition specialists on future options. On the telecommunications side, Racal says business is expected to grow at 15% annually, with good margins in a market expanding by 20-25% a year. But it says growth rates would be improved by international links for existing customers, strengthening of its value-added service portfolio, handling of network traffic landed in the UK and extra capital investment. A strategic partner could provide all, or some, of these, says Racal. Advisers are helping the company look at options.

Content from our partners
Green for go: Transforming trade in the UK
Manufacturers are switching to personalised customer experience amid fierce competition
How many ends in end-to-end service orchestration?

Websites in our network
Select and enter your corporate email address Tech Monitor's research, insight and analysis examines the frontiers of digital transformation to help tech leaders navigate the future. Our Changelog newsletter delivers our best work to your inbox every week.
  • CIO
  • CTO
  • CISO
  • CSO
  • CFO
  • CDO
  • CEO
  • Architect Founder
  • MD
  • Director
  • Manager
  • Other
Visit our privacy policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.
THANK YOU