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  1. Technology
April 19, 1988


By CBR Staff Writer

The fabled German Miracle of the legendary Ludwig Erhardt may have long ago run out of a lot of its steam, but one German Miracle that seems to just keep rolling along is the country’s one major independent computer manufacturer Nixdorf Computer AG, which seems to have bucked more of the negative trends of the past few years than any other company in the business. The Paderborner moved into Frankfurt yesterday to strip off the last of its seven veils from its 1987 figures to reveal that profits for the year rose another healthy 19% to the equivalent of $158.8m on turnover up 13% at UKP3,068m – figures adjusted for new accounting procedures. West German business grew 16% to UKP1,648m – 53.7% of the total, international business grew only 9% to make up the balance. For the current year, the company is not seeing any substantial slow-down in growth, looking for turnover to rise by at least 10%, which is likely to put it substantially ahead of the pack. Orders in hand at the turn of the year were a very comfortable $3,068m, matching the previous year’s turnover and up 16% on the figure at the end of 1986: with that kind of cushion, the room for really nasty surprises is very limited. In 1987, Nixdorf increased capital spending by 12% to $436m and research and development expenditure by 11.7% to $287m – a comfortable 9.3% of turnover. Telecomunications The company did not break down its international business beyond saying that France and Spain were substantially its biggest two foreign markets, followed by Switzerland and the UK. And that being the case, Nixdorf says that the first foreign listing for its shares is likely to be on the Madrid exchange, with France and Switzerland – but not London – in the plan for thereafter. In the split of its lines of business, small and medium-sized companies account for 30%; the financial and banking sector 30%; industry 20%; trade and commerce 10%; and the public sector a lowly 8%: Nixdorf has long complained that in the eyes of the authorities, the computer arm of the Siemens AG electrical and electronic conglomerate appeared to be the only German computer company. Another remarkable achievement is that the company reckons it sold 1,000 of its Targon Unix machines in 1987, so that the line, built from ground zero in little over two years, is now a very substantial business. Telecommunications, led by the 8818 PABX, accounted for 10% of hardware sales, and ISDN related business doubled during the year. Chairman Klaus Luft couldn’t resist another swipe at the monopolistic parctices of the Deutsche Bundespost – and it’s not surprising that Nixdorf feels aggrieved at the West German telecommunications authority because the world’s first product to achieve a comprehensive convergence of computing and telecommunications, the Nixdorf 8811 Data Telephone modular speech and data terminal system way back in 1978, was rendered stillborn by archaic rules that forbade use of the same line for speech and data. Luft confined himself to calling for faster deregulation and freer competition for those offering telecommunications attachment equipment. Despite the massive Marshall Field order for point-of-sales systems, Nixdorf seems to be resigned to remaining a niche player in the US market, and this year’s plans call for heavy investment in the UK, France, Spain and Italy.

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