Corel stems sales shrinkage
Q2 loss narrows too - is the turnaround plan is working?
Corel's troubles appeared to be easing yesterday when the company posted third quarter results which included both a narrowing loss and stabilising sales.
The Canadian software company lost $10.7 million - 15 cents a share - during June, July and August, much of it due to one-off charges related to the numerous job cuts the company has made as part of its $40 million cost-cutting turnaround programme.
In June, Corel laid off 320 staff, some 21 per cent of its workforce. At the start of this month, it made a further 139 employees redundant when it merged its Dublin, Ireland engineering operation into its Canadian HQ.
Analysts had expect Corel to post a loss of 28 cents a share for the period. Last year, it posted profits of $17.6 million, last quarter it was $23.6 million in the red.
Sales for the latest quarter hit $36.4 million, down just slightly on last quarter's $36.6 million. Revenues for Q1 2000 were $44.1 million, with a loss of $12.4 million. That suggests that the company may well have stemmed the flow of customers turning away from it, though it has a long way to go to rebuild the level of business it was achieving this time last year. Q3 1999 saw sales of $71.3 million, almost twice what it achieved during Q3 2000.
"We recognise that we have a lot more work to do to in order to return the company to profitability," said Corel's interim CEO, Derek Burney. "However, these numbers are encouraging. They show we’re on the right track." ®