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Transportation equipment industry

Telekom Profits Fall, Ford Loses Europe, Lenders Ease Up on Arrears

Strategic Insights

— 1 min read

Despite expected significant growth in sales, Deutsche Telekom's profit after tax but before extraordinaries is anticipated to drop to 1.1bn marks (Pounds 340m) this year from DM2.5bn in 1999. The company attributes the decline to tough price competition in the fixed network business and high goodwill amortization for its acquisition of British mobile operator One2One. Meanwhile, Ford's European operations have been warning of unacceptable losses, while lenders are easing up on chasing loan arrears for cases over six years old.

Key Takeaways:

  • Deutsche Telekom's profit after tax but before extraordinaries is expected to fall to 1.1bn marks (Pounds 340m) this year from DM2.5bn in 1999, citing tough price competition and high goodwill amortization for its acquisition of British mobile operator One2One.
  • Ford's European operations have lost $55m (Pounds 33.5m) in the fourth quarter of 1999, an improvement from the $63m lost in the same quarter of 1998.
  • Sainsbury's has warned Barclays and other high street banks of charging customers for taking cash from hole in the wall machines at its outlets.
  • The Council of Mortgage Lenders (CML) has announced that its members will cease chasing loan arrears on repossession cases over six years old.
  • Dell Computer has issued a profit warning, citing parts shortages and a sales slowdown tied to year 2000 fears.

Statistics:

  • Deutsche Telekom's expected profit after tax but before extraordinaries for 2000: 1.1bn marks (Pounds 340m)
  • Ford's losses in the fourth quarter of 1999: $55m (Pounds 33.5m)
  • Ford's losses in the fourth quarter of 1998: $63m
  • Dell Computer's expected revenue for the fourth quarter: $6.7bn (Pounds 4bn)
  • Dell Computer's prior-year revenue growth rate: high 30%
  • Deutsche Telekom's sales growth: DM3.8bn
  • Deutsche Telekom's sales in 1999: DM73bn
  • Ford's overall profit in 1999: $7.2bn

Sources:

  • "Telekom profits fall to DM1.1bn" - Capital magazine, cited a confidential report from Deutsche Telekom
  • "Ford losses 'unacceptable'" - unidentified source
  • "Sainsbury warns on ATMs" - Sainsbury's press release
  • "Lenders ease up on arrears" - Council of Mortgage Lenders (CML) press release
  • "Dell issues profit warning" - Dell Computer press release

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