The growing view that recession in the US economy is over must ring hollow in the ears of companies like Sequent Computer Systems Inc, leaving them to cling to the hope that the old adage that it’s always darkest just before the dawn still has some truth in it. Yesterday, the Beaverton, Oregon company announced that it was getting out of the OEM business – Unisys Corp had been its biggest customer, and Siemens Data Systems built the machines under licence – laying off between 7% and 9% of its 1,700-strong workforce, and that the loss for the second quarter, including one-time charges, would be significantly worse than the $7m that it lost in the first. It blames declining OEM orders and the recession as the causes of its woes, and says sales for the quarter, while ahead of the $47.9m reported in the first quarter, will be down on the $58.2m reported this time a year ago, on which it made a $5.7m profit. Sequent does not see its position improving any time soon, and will severely restrict capital expenditure, cut travel costs and set a salary freeze. The company looks for continued growth in direct sales to fill the hole left by OEM business. The shares were temporarily suspended and when trading resumed they were down $2.0 at $9.75.
