Mobile telephone manufacturer Betacom Plc has hauled itself back into profit by pulling up rope ladders from Europe and shrinking its UK operation. Its results for the year ending June 30 show net profits of UKP623,000. The figures for last year are not directly comparable because the period ending June 30 last year was an interim; Betacom has changed its financial year to be in line with that of Amstrad Plc, which now owns 66% of the company. Profits before tax this year total UKP516,000, earnings per share are 0.8 pence. Betacom, which turned over UKP12.1m this fiscal year, has pulled out of continental markets, selling its stake in the Dutch and German joint venture firms Betacom Nederland BV and Loewe Betacom GmBH for a total profit of UKP213,000. The financial performance of the Dutch business was poor, said chairman Ken Ashton. The Dutch telephone market is relatively small and maintaining an investment in Holland did not fit with the company’s strategy. Only UKP57,000 of the profit came from continuing operations. The European sales contributed a lot, and a surprising amount – UKP246,000 – came from interest received. The restructure is part of an attempt by Betacom to retreat into its shell and consolidate its core business before branching back out onto the continent. To further its rationalisation, the company closed its Bristol service centre and integrated that operation into its Enfield, London-based head office, losing an unspecified number of staff in the move. The only operation to be continued outside the Enfield office is the distribution, which is subcontracted. The firm seems to be relying heavily on Amstrad for support, with joint product development and manufacture between the two bedmates and Co-operation in other fields, such as distribution, where cost-savings benefit the company, according to Ashton. The short term conservatism of the company has paid off in cash the balance sheet shows a healthy shift from a UKP2.6m overdraft for the interim ending June 30 1992 to a UKP3.2m cash surplus at this year end. The company, which bemoans the effect of sterling devaluation, (a problem for a firm operating only in the UK and having to import parts), has developed several new products, especially answering machines, which were funded by the rights issue last year (CI No 1,932). In its profit and loss statement for this fiscal year the company has set aside UKP155,000 as a provision against the return of products under warranty.
