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Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: Jerry Olson who wrote (111498)	8/9/2000 8:17:14 AM
From: ColtonGang	Read Replies (2) \| Respond to of 120523

Bookham beats expectations in Q2 Prospect of new issue knocks shares By Peter Bale, FTMarketWatch 12:05:00 PM BST Aug 9, 2000 LONDON (FTMW) – Bookham Technology, the fibre optics technology group, beat analysts’ expectations with stronger sales and narrower losses in the second quarter of the year, but its shares fell sharply after it announced plans to sell more stock. Bookham (TICKER:UK:BHM)[BKHM], one of the darlings of investors in the European emerging technology sector, said planned a secondary offering of its shares when market conditions allowed. Bookham floated at 10.00 pounds a share on the London Stock Exchange in April. Its shares fell as much as 11 percent but by midday were down 7.5 percent at 40.80 pounds. “People are having a bit of a reality check,” said Lawrence Peterman, head of research at Kyte Securities in London.. “This company hasn't proven itself and is extremely overvalued.” Booking Bookham profits Mark Johnson of private client broker Killik & Co took a more positive view, saying Bookham’s leading status in its industry and the prospect of expansion made it a strong bet. “Bookham has had a really good run up to today and it’s only natural that there would be some profit taking,” Johnson said. Bookham reported Q2 losses narrowing to 4.6 million pounds from 5.6 million in the first quarter. Revenues grew also to 4.6 million, up 84 percent from the first quarter this year and 10 times that of the same period in 1999. Analysts had forecast Bookham Q2 revenues of 4.2 million pounds and losses of 5.7 million. “This strong set of results is a reflection of the increasing acceptance of our technology and products within the optical networking market place,” said Bookham chief executive officer Andrew Rickman. Bookham relied on Nortel Networks [NT] for 59 percent of its sales during the quarter. Killik’s Johnson said Nortel and Bookham would grow together: “The noises from Nortel bode well for Bookham and overall the potential for the optical market going forward is very good.” Unlocking the broadband future Regional market coverage MarketPulse News Alerts Europe Asia/Pacific Americas Currencies Bookham makes chips and other components, which allow high speed processing of fibre optic signals seen as crucial to the development of high-capacity, broadband Internet communications. Research and development costs rose 46 percent in the quarter . Bookham said the outlook for the fibre optics industry remained strong. The company opened a new manufacturing plant in Swindon, west of London, during the quarter. It said recruitment was proceeding apace with its staff count rising to 593 from 393. Cashing in On the prospective secondary offering, Bookham gave no idea on the size of the offering but said the bulk of the shares would come from mainly from existing investors. However, it would take advantage of the sale to raise additional cash to fund expansion. “The exact timing and size of any offering will depend upon specific market conditions and corporate factors at that time,” it said. CEO Rickman holds about 25 percent of the company. Tax worries Bookham’s results included a 6.8 million pound provision to cover possible National Insurance contributions on stock options for its employees. It said it was looking at transferring that liability to the employees themselves under revised U.K. tax laws. British high technology companies have complained that tax conditions on stock options are restricting their ability to offer star employees the kind of stock option incentives they need to.