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February 10, 1999


By CBR Staff Writer

Wang Global Inc, the Billerica, Massachusetts-based systems integration and services company, reported a loss for the December quarter of $16.4m – mostly fueled by restructuring and integration charges of $41.5m – and said it will continue with job cuts. Revenue for the quarter was $1.03bn and, excluding charges, EBITDA (earnings before interest, taxes, depreciation and amortization) was $88.3m and earnings per share would have been $0.47 per diluted share. Analysts surveyed by First Call were expecting net income of $0.31 per share. The company says it ended the period with consolidated cash balances of $301.3m and total debt of $285.6m. During 1998, Wang changed its fiscal year end from June 30 to December 31. For the six-month period ended December 31, 1998, net loss was $27.6m on revenue of $1.82bn. Excluding restructuring and other charges, earnings per share would have been $0.26 for the period. For the calendar year ended December 31, the company said it booked revenues of $3.05bn and EBITDA of $222.3m. Wang reaffirmed its previously-stated goals of achieving $150m-$200m in cost reductions for calendar 1999 and said as of the end of the December quarter, the company had exceeded its previously announced target of the 2,300 reductions in workforce planned for the 1998 calendar year. It also said it would likely exceed its target of 3,100 reductions before the end of calendar year 1999. In addition, 500,000 square feet of excess office and warehouse space were eliminated during the quarter, bringing the total reduction of space to 1.5 million square feet of the targeted 2.5 million square feet scheduled for reduction by December of 1999. The company insisted that despite the further cuts, it will still remain within its planned $380m estimate for total restructuring charges which it announced following the acquisition of Olsy.

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