Anyone here down short................?
Sees More Trouble In Asia
(05/25/98; 11:59 a.m. EST)
By Reuters
Sun said Monday its business in Southeast Asia and India had been hurt
by the region's financial woes and it expected growth to slow this year.
"In 1998, I expect growth to be lower in local currencies," Lionel Lim,
Sun's Asia South executive managing director, told Reuters.
"If we are able to do 20 percent growth in local currencies, that would
be a feat in 1998," he added.
Lim said Sun's revenue in the region was already hit in 1997 when it
registered sales growth of 40 percent in terms of Asian currencies or
about 20 percent in U.S. dollars. This was poorer when compared with a
traditional 40 percent to 50 percent growth in the U.S. currency.
The region made only a small contribution to Sun's global revenues and
therefore impact on a worldwide basis was minimal, he said.
For the third quarter ended March 29, said Michael Lehman, the company's
chief financial officer, lower revenues from Southeast Asia shaved 3.5
percentage points from overall revenue growth.
About 2.5 percentage points were lost due to the stronger U.S. dollar,
he said.
Sun reported a modest rise in third-quarter earnings with net income of
$232 million against $197 million a year ago, excluding a one-time gain.
South Korea, Japan and Southeast Asia together accounted for about 12 to
15 percent of its global revenues, Lehman said.
On his outlook for the company's South Asia region, covering Southeast
Asia and India, Lim said: "Indonesia will continue to be the most
difficult market for the next six months." Singapore would continue to
lead the region and India was also a strong market.
He said that, so far, Sun had not been affected by the U.S. imposition
of sanctions on India after its nuclear tests. Sun has marketing and
support operations and a center for software developers working on its
Java technology in India.
Lim said he expected an upturn in Thailand in the second half of this
year and business to pick up in the Philippines once it got through the
elections period.
Malaysia had some bright spots in selective industries and its high-tech
zone, called the Multimedia Super Corridor.
On Sun's lawsuit against Microsoft over a contractual agreement for the
use of Sun's Java language in its Windows 98 operating system, Lim said
it did not matter if Sun won the case.
Sun's Java programming language is an ideal tool for network devices
which tap networks for power and information, Lim said. This is a
concept championed by Sun, Oracle and IBM.
He sees network devices based on Java, which would include future
cellular phones, outnumbering desktop devices like personal computers
and present day desktop-based network computers in three to five years'
time.
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