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Technology Stocks : PCW - Pacific Century CyberWorks Limited -- Ignore unavailable to you. Want to Upgrade?

To: ms.smartest.person who wrote (768)	3/28/2001 10:26:20 PM
From: ms.smartest.person	Read Replies (1) \| Respond to of 2248

PCCW LEX COLUMN: PCCW LEX COLUMN Financial Times, Mar 29, 2001 PCCW You do not need to be a genius to figure out that a company writing off Dollars 627m in dud internet investments has made some serious mistakes. Pacific Century Cyberworks estimates that its listed and unlisted ventures are now worth 33 cents for every dollar it put into them. The dream of creating a global broadband internet powerhouse is over, and the company is slashing investment in its Network of the World project. PCCW will halve spending on broadband initiatives in 2001 from roughly Dollars 400m last year. That was then; this is now. PCCW has the old Hong Kong Telecom business to fall back on. However, it is not in great shape either. PCCW had to fold HKT's mobile operations and regional internet backbone into joint ventures with Telstra to raise cash to pay down part of the Dollars 12bn debt it took on to buy the company. The rump business in Hong Kong faces severe competition, particularly in international calls, where revenues fell by a third last year. Broadband access is a bright spot; data revenues are rising fast. But overall, old HKT revenues fell 7 per cent in 2000, and it is hard to see much growth in 2001. At least PCCW's stock has already fallen 87 per cent from its peak and is no longer obviously overvalued. Even on fairly grim assumptions, the restructured telecoms business plus property interests would be worth HKDollars 3 a share. However, with gearing still at challenging levels, and no sign of an imminent breakthrough in mainland China, there is scant reason to buy the stock, and every chance that it will fall further. Copyright: The Financial Times Limited globalarchive.ft.com