To: jwk who wrote (40192 ) 5/10/2001 12:32:36 PM From: BrightFuture Read Replies (2) | Respond to of 40688 Found this interesting...dailynews.yahoo.com Survey: Profitable European Dot-Coms on Increase LONDON (Reuters) - Many more European Internet companies became profitable in the fourth quarter last year as external funding all but dried up, a survey found Thursday. Not only were 38 percent of the top 150 European companies raking in profits, up from 28 percent in the third quarter, but for the first time, spending in the sector fell back in line with sales growth, PricewaterhouseCoopers found in a quarterly study. Spending growth outstripped sales growth by just one percent, down from 11 percent in the previous quarter. This means that burn rates of loss-making companies, which are still in the majority, have generally stabilized. ``We moved from a (stock exchange) crash to stabilization within 12 months, which is fascinating,'' said Kevin Ellis, partner at PricewaterhouseCoopers. But this does not mean that all dot-coms, who raised just 196 million euros in stock market flotations versus 900 million in the third quarter, now have well balanced finances. In fact, on the basis of fourth quarter income and balance sheet statements, loss-making dot-coms would on average run out of cash in 18 months. Of all companies reviewed, 18 percent would not even survive more than 12 months, up from 15 percent in the third quarter and 13 percent in the second quarter. Although the PricewaterhouseCoopers study does not show the full impact of the dot-com fall-out, as weaker companies are often first replaced by stronger rivals in the top 150 before failing, there is a clear distinction emerging between robust and dwindling Internet enterprises. ``There is complete polarization,'' Ellis said. The top 25 percent by share price performance are on average more profitable and growing sales faster, while the bottom 25 percent have seen little sales growth. Internet providers are leading the way with 50 percent of them already profitable, compared with a 38 percent average, and average sequential sales growth of 29 percent versus seven percent for the top 150.