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Technology Stocks : PCW - Pacific Century CyberWorks Limited

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To: ms.smartest.person who wrote (1738)	7/27/2001 11:09:18 PM
From: ms.smartest.person	Read Replies (1) of 2248

Distress at telco's price tumble By Leonie Wood TELSTRA boss Ziggy Switkowski yesterday acknowledged the group was "distressed" by the steep slide in the telecommunications carrier's share price as Australia's most widely held stock again plumbed three-year lows. Telstra sank 9¢ to $4.90 yesterday despite management conducting a three-hour briefing to improve investor confidence in its joint venture strategy with controversial Hong Kong partner Pacific Century CyberWorks. The shares are a third off the $7.40 price for shares issued in the Federal Government's $16 billion Telstra 2 share sale, and are 27 per cent below levels of early last month when the carrier warned of a significant profit slowdown. In Hong Kong, PCCW's shares are more than 90 per cent below the level Telstra originally agreed to pay for a stake as part of the first plan to share assets. Although the briefings failed to enthuse analysts, Telstra revealed it had learnt many lessons from the upheaval of the past year. Dr Switkowski argued that global telecommunications companies had been hit hard in the past 18 months as carriers took on huge debts to pay for acquisitions and so-called third generation wireless spectrum in Europe. Competition had intensified and profit margins were crushed. Asked when he expected market sentiment to turn, Dr Switkowski noted the industry partly remained "hostage to the global economy". But much depended on how fast the heavyweight carriers could repair their balance sheets, and so restore stable pricing and profit margins. "So a combination of judgments about the global economy, the condition of the larger players, the onset of new services, will then lead you to form a view about when share prices might recover," he said. "But at the moment, it is clear - sentiment towards this industry sector remains negative. "We are clearly distressed with where the share price is at the moment although understanding that in the global re-evaluation of telcos, Telstra's slide has probably not been as deep as others. "(Yet) that is hardly a satisfactory claim to make." -THE AGE © 2000 West Australian Newspapers Limited All Rights Reserved.

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