The future is looking good for this company.
CWC: Telecoms group rings up strong
By Alan Cane
Cable and Wireless
Communications, the UK's largest cable-television-to- telephony
group, returned to profit in the first half of the year
despite substantial investments in infrastructure and
measures to cope with the millennium bomb.
group recorded a profit, before and after tax, of �65m
in the six months to September 30, compared with a
loss of �135m last year. Underlying profits before
tax, after stripping out the effects of �200m
restructuring costs last year and an �8m millennium bomb charge
this half, came to �73m (�65m).
before interest, tax, depreciation and amortisation
increased 17 per cent to �390m. Underlying earnings per
share improved 12 per cent to 4.9p.
increased 14 per cent to �1.26bn helped by powerful growth
in data, video, internet and advanced services.
Graham Wallace, chief executive, said the proportion of
total turnover from the faster-growing parts of the
business had increased from 20 per cent to 25 per
"Many our our activities in the last six months were
aimed at improving customer service and productivity.
The outsourcing of commercial information technology
to IBM will increase the speed of delivery of
improved systems into the business," he
All four business units showed growth. Consumer
markets showed a 20 per cent improvement to �139m chiefly
through a 29 per cent improvement in telephony revenues.
International and partner services grew 22 per cent to �450m
and CWC now claims to be the ninth largest carrier of
It intends to spend �75m
dealing with the millennium
CWC is investing heavily in a national network
running on the most modern technology and using internet
protocols. It has sensibly outsourced its sorry collection
of information technology systems to IBM and it will
introduce interactive digital television, probably in early
summer next year. Television accounts for only �108m of
its �1.26bn total revenues. Digital television,
however, is just another form of data and data services
are growing rapidly. Revenues and profits should
continue on an upward track and, at 474p, the shares look
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Sorry, don't know anything about Matteucci. I too
hope Brown doesn't leave, but even if he did, CWP
would muddle through. It's a good company, doing well
on its own, and one that is likely to be absorbed by
someone else at some point. I had thought that AT&T would
go after CWP, but then AT&T went after TCI, which
should keep them busy for awhile. However, I believe
that CWP will be prime takeover bait at some point,
with or without Brown.
I found the article. I hope he
doesn't leave. I believe
that he does have an
employment contract, I don't know
how much that
Do you have any thoughts on the hiring of
D. Matteucci as chief executive officer of Cable &
The story is still on the Interactive Wall Street
under EDS, Briefing Books, then Company
News. The entry is dated 11/24/98. It mentions several
people that have been considered for CEO of EDS, but the
company hasn't said who the choice will be.
".. is $75 per adr
realisitic for next year? Seems that right now is
undervalued by $12-$15 per sh. ..."
I also believe,
based on financial reports, that CWP is undervalued by
about $12-14 per share. $55 by early next year would be
more realistic ... although $75 would be VERY
This is an extremly attractive long term accumulate in
Fundamentals look great. The Cienna eq.
buy will only enhance the deliverables.