Weak markets depress OM
16 April 2003 | 3078 views | 0
Swedish transaction technology vendor OM says it is focusing on measures to improve operational efficiency as weak markets continue to eat into revenues and profits.
OM's interim report shows first quarter revenues down 13% to Skr612 million from Skr703 million a year earlier and income before depreciation at Skr97 million, against Skr119 million in Q1 2002. Operating income nearly halved to Skr22 million from Skr42 million in the corresponding period, while net income plumetted 60% to Skr8 million from Skr20 million last year.
The vendor says the global economic downturn and political instability meant a continuation of last year's weak markets and a decrease in revenue within its
exchange and technology operations. Trading volumes on Stockholmsbörsen fell while companies on the financial and energy markets remained cautious regarding IT investment decisions.
OM chief executive Per larsson comments: "It is discouraging to see how our revenues have continued to be affected negatively by a weak demand on our most important markets during the quarter. We will continue to focus on enhancing operational efficiency."
Since OM introduced a series of cost-reduction measures in the second quarter 2001, group operating expenses have fallen by over Skr1 billion on a yearly basis, equivalent to a reduction in total expenses per employee of 35 percent.
In March, the vendor announced a further reorganisation with the aim of cutting 1000 jobs and an additional Skr60 million from annual operating expenses, with full effect expected from the first quarter 2004.