Tulips Computers NV, the Hertogenbosch, Netherlands PC distributor which was rescued from bankruptcy last year, expects to be back in profit by the end of the current financial year and hopes to get its shares quoted officially again on the Amsterdam stock exchange. While the shares rose 33.9% to 3.95 euros in over-the-counter dealings, the one cautionary note from directors is the possibility it could be faced with a stagnation in demand over the millennium.
Tulip shrivelled and nearly died in 1998 because as a modestly-sized European outfit it could not cope with the competition from companies like Dell Computer Corp. Tulip has cut production costs substantially by outsourcing manufacturing to Ingram Micro so that CEO Hans Van Helden reckons that even in today’s intensely competitive environment, gross margins are around the 18% level.
But Van Helden, brought in from Dutch services giant Getronics, sees the big change as positioning Tulip as a systems integrator. It is moving away from a company 95% reliant on the PC market, to one in which attendant services play a bigger part. Tulip now builds-to-order and will bring in partners where necessary on contracts. It also has a partnership with Data General and sells the company’s high-end servers. In addition it is looking to add to the range of its products and expects to announce the result of a smartcard project with other European companies in the first quarter next year.
In the first half of the current year, Tulip made a loss of 2.8m guilders ($1.3m) down from a loss of 38.2m guilders ($18.3m). Revenue was down 25.3% at 97.1m guilders ($46.6m) though the company says the figures are not directly comparable because the 1998 figures covered a seven-month period when the company was operating on a much larger scale before restructuring.
