Global Economy Remains Strong Despite Southeast Asian Turmoil

Economic troubles in Southeast Asia have battered the stock of Eden Prairie-based computer firm Stratasys Inc., with a 19.4 percent drop in its stock value. However, despite this setback, Stratasys CEO Scott Crump remains optimistic about the global economy. Crump believes that the interconnectedness of world financial markets has created a phenomenal opportunity for companies like Stratasys, which sells rapid prototyping units worldwide.

Crump notes that about 7 to 8 percent of Stratasys' fourth-quarter sales are in jeopardy due to economic turmoil in Southeast Asia. The company has already seen a significant impact from currency fluctuations, with customers in the region unable to afford even lower-priced machines. In response, Stratasys plans to bolster its marketing efforts and shift sales to the United States and Europe.

Meanwhile, Indonesia has signaled a willingness to begin implementing sweeping economic reforms prescribed by the International Monetary Fund (IMF). The IMF has asked Indonesia to pare government spending, overhaul its banking system, and deal with its overhang of bad loans. IMF Managing Director Michel Camdessus is expected to arrive in Jakarta on Wednesday to discuss the implementation of these reforms with Indonesian President Suharto.

Key Takeaways:

• Southeast Asian economic turmoil has impacted Stratasys Inc.'s stock value, with a 19.4 percent drop in its stock value.
• Crump remains optimistic about the global economy, citing the interconnectedness of world financial markets as a benefit for companies like Stratasys.
• About 7 to 8 percent of Stratasys' fourth-quarter sales are in jeopardy due to economic turmoil in Southeast Asia.
• The company plans to bolster its marketing efforts and shift sales to the United States and Europe.
• Indonesia has signaled a willingness to begin implementing economic reforms prescribed by the IMF.
• IMF Managing Director Michel Camdessus is expected to arrive in Jakarta to discuss the implementation of these reforms with Indonesian President Suharto.
• Stratasys' fourth-quarter revenue and earnings per share are expected to be lower than anticipated.
• The company hopes to make up for lost sales in the first half of 1998 through renewed sales efforts in Southeast Asia and shifting sales to the United States and Europe.

Statistics:

• Stratasys' stock value dropped 19.4 percent on Monday.
• About 7 to 8 percent of Stratasys' fourth-quarter sales are in jeopardy due to economic turmoil in Southeast Asia.
• Stratasys hopes to make up for lost sales in the first half of 1998 through renewed sales efforts in Southeast Asia and shifting sales to the United States and Europe.
• IMF Managing Director Michel Camdessus is expected to arrive in Jakarta on Wednesday to discuss the implementation of economic reforms with Indonesian President Suharto.

Sources:

• Los Angeles Times