/raid1/www/Hosts/bankrupt/TCREUR

/raid1/www/Hosts/bankrupt/TCREUR_Public/030724.mbx T R O U B L E D C O M P A N Y R E P O R T E R E U R O P E Thursday, July 24, 2003, Vol. 4, No. 145 Headlines A U S T R I A VA TECHNOLOGIE: Analyst Backs Return to Profit Forecast in 2003 C Z E C H R E P U B L I C CESKE RADIOKOMUNIKACE: Majority Shareholder Drops Buyout Offer CESKE RADIOKOMUNIKACE: Divests Loss-making Contactel to TDC F R A N C E ALSTOM SA: Wins Supply Contract in EUR90 Mln Power Plant Project ALSTOM SA: Nexans Won't Challenge Areva's Bid KALISTO ENTERTAINMENT: Faces Securities Fraud Suit in Paris NEXANS: Operating Margin Holds Up Well Despite Poor Sales VIVENDI UNIVERSAL: Metro-Goldwyn Likely to Increase Offer VIVENDI UNIVERSAL: Sale of U.S. Asset Not Expected Before Autumn G E R M A N Y ENERGIE AG: Recruits Neurkirchen to Assist CEO in Restructuring INFINEON TECHNOLOGIES: Reports Flat Third Quarter Revenues NORDDEUTSCHE AFFINERIE: Plans to Save Cost to Improve Results POET HOLDINGS: Operating Loss Up as Revenues Dive I R E L A N D AER LINGUS: To Fly Toulouse and Tenerife Routes Starting Oct. 26 I T A L Y TELECOM ITALIA: Innovation, Research Keys to Growth N E T H E R L A N D S ING GROEP: Sells Italian Network Activities to UniCredito NUMICO N.V.: Completes Sale of Brazilian Business to Kremon P O L A N D HOOP: Shelves IPO as Rumors of Accounting Irregularities Mount S W E D E N TELELOGIC: Sees Initial Signs of Recovery in Telecommunications S W I T Z E R L A N D ASCOM: Transport Revenue Business Unit Wins Another Major Order U N I T E D K I N G D O M AWG PLC: Lists Additional Shares on London Bourse BRITISH AIRWAYS: Meeting with Trade Unions Fails to Reach Deal BULLOUGH PLC: Cancels Listing on Alternative Investment Market CORDIANT COMMUNICATIONS: Shareholders OK Scheme of Arrangement EASYJET PLC: Trading in Line with Interim Result Outlook FREMONT INSURANCE: Declares Fourth and Final Dividend LE MERIDIEN: Royal Bank Backs Guy Hand's Offer LONDON FORFAITING: Sell-off Talks Make Substantial Progress NETWORK RAIL: Members Want More Audience with Board THOMAS COOK: Plans to Cut Hotel Capacity in Winter, Next Summer TRINITY MIRROR: Braces for Strike at Scottish Titles TRINITY MIRROR: Peddles Northern Ireland Affiliates ********* ============= A U S T R I A ============= VA TECHNOLOGIE: Analyst Backs Return to Profit Forecast in 2003 --------------------------------------------------------------- The current year looks auspicious for Austrian engineering firm VA Technologie, Erste Bank analyst Ralf Burchert said, according to Dow Jones. Mr. Burchert expects the company to post net profit of around EUR11.1 million. The outlook coincides with VA Technologie's hopes to return to profit this year after posting a net loss of EUR93 million last year. The company, though, did not reveal a target. The favorable forecast is attributable to the restructuring efforts undertaken by the company in 2000. VA Technologie refocused on metallurgy and energy transmission, cut costs and sold non-core business. Mr. Burchert also expects the firm's order intake and sales for 2003 to be at around last year's levels. But he said: "Some more restructuring work needs to be done in the water business... and some streamlining in transmission and distribution." VA Tech Chief Financial Officer Roland Scharb, meanwhile, said he expects order intake of more than EUR2 billion for the first half of 2003 -- a feat considered "very strong" by Jens Zimmermann, an analyst at Bank Austria. The company reported orders of EUR2.2 billion for the year-earlier period. =========================== C Z E C H R E P U B L I C =========================== CESKE RADIOKOMUNIKACE: Majority Shareholder Drops Buyout Offer -------------------------------------------------------------- Bivideon B.V., having its registered office at Herengracht 450, Amsterdam, the Netherlands, registered at the Chamber of Commerce for Amsterdam number 34152379, after discussions with the Securities Commission (SEC) and in agreement with the SEC, hereby announces that on July 17, 2003 Bivideon B.V. withdrew its application for SEC approval of a public takeover offer to all owners of participating securities, being the ordinary bearer shares issued by Ceske Radiokomunikace a.s., having its registered office at U nakladoveho nadrazi 3144, 130 00 Praha 3, the Czech Republic, identification number 60193671. The reason for the withdrawal of the Application is to allow Bivideon B.V. to address certain technical aspects of the settlement process of the Offer and the opportunity to submit an additional expert valuation to support the Offer. Bivideon B.V. would like to point out that if it submits to the SEC a new application for approval of any new tender offer in the near future, the price offered per one share of Ceske Radiokomunikace a.s. in such tender offer will not exceed CZK245. ***** Ceske Radiokomunikace posted a net loss of CZK108 million last year, down from a profit of CZK809 million in 2001. The company expects to return to profitability this year. CESKE RADIOKOMUNIKACE: Divests Loss-making Contactel to TDC ----------------------------------------------------------- Ceske Radiokomunikace a.s. announced in a press release on July 9, 2003 that it has agreed, subject to clearance by the competition authorities and the approval of a general meeting of Contactel, s.r.o., to sell its entire ownership interest in Contactel to TDC Totallosninger A/S. The joint shareholders of Contactel, the company and TDC Totallosninger, attended an extraordinary general meeting of Contactel on July 9, 2003, which approved the transfer of the company's entire ownership interest in Contactel to TDC Totallosninger. TDC Totallosninger has formally notified the company that competition clearance was granted on July 9, 2003 by the Czech Antimonopoly Office for the transfer of the company's entire ownership interest in Contactel to TDC Totallosninger. The transfer of the company's ownership interest in Contactel to TDC Totallosninger took effect on July 14, 2003. Contactel has been in the red since 1999. =========== F R A N C E =========== ALSTOM SA: Wins Supply Contract in EUR90 Mln Power Plant Project ---------------------------------------------------------------- ALSTOM has been awarded a contract by N-ERGIE AG, Nuremberg's electrical utility, to supply a cogeneration power plant to the Sandreuth combined heat and power plant. N-ERGIE AG is investing a total of EUR90 million for this power plant modernization project, in which ALSTOM is the principal supplier. ALSTOM will provide the Balance of Plant, the Heat Recovery Steam Generators with supplementary firing behind the gas turbines, the electrical and control system and civil works. Furthermore, the scope of supply includes the supply, installation and commissioning of two natural gas-fired 43 MW GTX100 gas turbines and the conversion of one existing coal fired boiler to gas/oil firing. The increased capacity will enable the Sandreuth heat and power plant to provide the heating needs of 25% of the Nuremberg population via a 270-kilometer district heating network. The project will benefit from German government subsidies that are in place for the modernization of heat and power plants. Commissioning of the plant is scheduled for spring 2005. ALSTOM is a global leader in energy and transport infrastructure. The company serves the energy market through its activities in the fields of power generation and power transmission and distribution, and the transport market through its activities in rail and marine. In fiscal year 2002/03, ALSTOM had annual sales in excess of EUR20 billion and employed around 100,000 people in over 70 countries worldwide. CONTACT: ALSTOM Investor relations E. Chatelain Phone: +33 1 47 55 25 33 E-mail: investor.relations@chq.alstom.com ALSTOM SA: Nexans Won't Challenge Areva's Bid --------------------------------------------- Nexans, the French cable maker that denied having made an offer for Alstom's Transmission and Distribution activities, said it would only lodge a formal offer if Areva pulls out its bid. While the pressure for the company to diversify into more profitable business mounts, Nexans chief executive Gerard Hauser told the Financial Times recently he was not interested in directly competing with Areva for the acquisition. France's state-owned nuclear energy group, Areva, made a EUR1 billion (US$1.13 billion) bid for the unit. "A state-owned company has possibilities and motivations that are not always those of a private investor," Mr. Hauser was quoted saying. Nexans, which continued to show a decline in revenues and operating profits in the first half of the year, previously denied having offered a bid, although it admitted making an informal proposal to Alstom's management. Nexans' hope to make an offer now lies on the possibility that Areva's bid will be blocked by Brussels regulators, who has already asked the French government to rationalize the nuclear energy group's offer. But while Nexans assured it has full support of shareholders and banks for the proposal, analysts still doubt the company's ability to acquire a business worth almost three-times its market capitalization of EUR350 million. The transaction stands to increase its net debt, which already amounted to EUR142 million at the end of June. Nexans has also warned it would still be in the red for full year after narrowing net loss from EUR11 million to EUR2 million in the first half. Nexans' proposal is understood to include plans to raise funds for the acquisition both from shareholders, through a massive rights issue, and from banks, through increased debt. It would defer about 20% of the total payment, worth slightly more than EUR1 billion, for two years, according to the report. KALISTO ENTERTAINMENT: Faces Securities Fraud Suit in Paris ----------------------------------------------------------- Minority shareholders of Kalisto Entertainment SA have filed a criminal complaint against the bankrupt video game maker, according to Dow Jones Newswires. The complaint, filed by shareholders rights group Deminor on behalf of some 300 shareholders and ex-shareholders, alleges that Kalisto distributed false information, published false balance sheets and misused company funds. Dow Jones, citing a statement by Deminor, said shareholders claim Kalisto committed the infractions during preparations for enlistment on the Paris stock exchange in June 1999. In December 2002, Kalisto shareholders also filed a lawsuit against French bank Credit Lyonnais and audit firm Ernst & Young LLP with a Paris trade court in December 2002 seeking "damages for the prejudice incurred to Kalisto shareholders." Both Credit Lyonnais and Ernst & Young LLP were involved with Kalisto's stock market listing and auditing. Based in Bordeaux, France, Kalisto was founded in 1990 and has offices in Japan, USA, China and the U.K.. It specializes on video games creation, technology research and development. NEXANS: Operating Margin Holds Up Well Despite Poor Sales --------------------------------------------------------- At its meeting on July 21, 2003, chaired by Gerard Hauser, the Nexans Board of Directors reviewed Nexans' financial statements for the first half of the year. Against the background of a continuing deterioration in market conditions, sales in the first half of the year were EUR1,992 million. At constant non-ferrous metal prices and exchange rates, sales were EUR1,945 million compared with EUR2,007 million in the 6 first months of 2002 (a fall of 4.4% compared with the first half of 2002, at constant consolidated scope but only 3.4% lower than the second half of 2002). Operating profit was EUR20 million at June 30, 2003, EUR4 million lower than at June 30, 2002. Despite the fall in sales, the operating profit margin rate was close to that of first half 2002 (1% compared with 1.2%). In line with earlier announcements, income from operations in the Telecom business was close to the breakeven point (-EUR1 million). Net income was -EUR2 million compared with -EUR11 million at June 30, 2002. In line with its targets Nexans has maintained very considerable downward pressure on working capital and investments, thereby limiting net debt at June 30, 2003 to EUR142 million, despite the EUR38 million in expenditures on acquisitions, share buybacks and dividend payments of Nexans. Gerard Hauser, Chairman and CEO, commented: "While the economic environment continues to worsen and industrial investment is slow to pick up, Nexans has given priority to rigorous management of its operations, which should enable it to consolidate its leading position in the Energy and Telecom infrastructure markets and to be better placed to profit from economic recovery. In view of the restructuring that has been undertaken in the cable industry as a whole and future needs for plant and equipment throughout the world, the company's prospects remain favorable. For 2003, we believe we can maintain our operating profit margin rate for the year as a whole at a level close to that for 2002. However, our net income, which has risen compared with the previous year, is likely to remain negative". (a) Consolidated results: In millions of Euros H1 2002 H1 2003 Sales 2,228 1,992 Sales (at constant metal prices and exchange rates) 2,007 1,945 EBITDA (as % of sales) 99 89 4.7% 4.6% Operating profit (as % of sales) 24 20 1.2% 1% Net income (11) (2) Sales for the six months ending June 30, 2003, were EUR1,992 million, versus EUR2,228 million at June 30, 2002. At constant non-ferrous metal prices, sales were EUR1,945 million, a fall of 4.4% compared with the first half of 2002, on a comparable basis and at constant exchange rates. Operating profit was EUR20 million, compared with EUR24 million in the first half of 2002. Nexans' performance was boosted by the return of the Telecom business to a breakeven level and the outstanding results recorded in the high-voltage power cable activity. Provisions for restructuring expenses amounted to EUR9 million, consistent with the overall restructuring budget of EUR130 million spread over 2002 and 2003. Net income is close to the breakeven point (-EUR2 million). (b) Results by activity: in millions of Euros H1 2002 H1 2003 Sales (1) Operating Sales(1) Operating Profit profit Energy 1,038 34 1,033 24 Telecom 276 (22) 278 (1) Electrical wires 539 8 494 - Distribution 154 5 140 4 Other - (1) - (7) Total 2,007 24 1,945 20 (1) Sales at constant metal prices and exchange rates Energy: Sales in the Energy Division of EUR1,033 million, were close to those of the first half of 2002, after taking into account the inclusion of Kukdong and energy cable subsidiary of Furukawa in Brazil in the Group account which impact this figure by approximately EUR25 million. Operating profit was EUR24 million, compared with EUR34 million at June 30, 2002. This result reflects very different situations, ranging from the excellent performance of the infrastructure cable business to the weakness of low-voltage cables for building, which was due largely to a fall in prices. Telecom: Sales in the Telecom Division were unchanged from the first half of 2002 at EUR278 million. This followed four consecutive half-years of declines. At -EUR1 million, the operating profit came close to the breakeven point. This reflected mainly the positive impact of the vigorous restructuring plans the Group has been implementing since the end of 2001, which have led to a reduction of 6.3% in indirect costs compared with June 30, 2002. Electrical wires: Sales in the Electrical wires division came to EUR494 million, compared with EUR539 million at the end of June 2002, a fall of 8.3%. Operating profit is at breakeven, which represents a decline compared with the first half of 2002 resulting from the weakness of industrial investment in the winding wires sector and the negative impact (EUR3 million) of the restructuring in the USA. (c) Outlook for 2003 The economic environment in which Nexans operates is likely to remain difficult in 2003 and will continue to have an adverse impact on sales. However, the recovery in the telecommunications cable business, the prospects for an improvement in power cable sales in the second half and the continuing fall in indirect costs mean that the operating profit margin for 2003 is likely to be close to that achieved in 2002. The Board of Directors has decided that in the full year accounts at December 31, 2003, the provisions of CRC regulation 2002-10, which allow for the calculation of various depreciation periods depending on the composition of the assets, will be applied. This should have a positive effect on shareholders' equity and on operating profit, which could then exceed that recorded in the previous financial year. (d) Financial calendar: Publication of third-quarter sales: October 15, 2003 About Nexans Nexans is the worldwide leader in the cable industry. The Group brings an extensive range of advanced copper and optical fiber cable solutions to the infrastructure, industry and building markets. Nexans cables and cabling systems can be found in every area of people's lives, from telecommunications and energy networks, to aeronautics, aerospace, automobile, railways, building, petrochemical, medical applications, etc. With an industrial presence in 28 countries and commercial activities in 65 countries, Nexans employs 17,150 people and had sales in 2002 of EUR4.3 billion. Nexans is listed on the Paris stock exchange. To See Financial Results: http://bankrupt.com/misc/NEXANS.htm CONTACT: NEXANS Investor relations Michel Gedeon Phone: +33 (0)1 56 69 85 31 E-mail: michel.gedeon@nexans.com VIVENDI UNIVERSAL: Metro-Goldwyn Likely to Increase Offer --------------------------------------------------------- Speculations that Metro-Goldwyn-Mayer Inc. may come up with an offer higher than its previous bid of US$11.2 billion for Vivendi Universal's U.S. Entertainment unit intensified after the French group beat the deadline to submit additional information on the value of the assets. Chief Executive Alex Yemenidjian said in a letter to Vivendi last week it will raise its offer for the U.S. unit to US$11.5 billion if Vivendi provided additional data, people familiar with the situation said, according to the Financial Times. Metro-Goldwyn has reportedly sought details such as what movies Universal Studios has sold its rights to; terms of contracts between Vivendi's cable networks and the providers that carry them; and agreements between Vivendi and Blackstone Group LP, which owns a 50% stake in Universal Studios' Florida theme parks. Vivendi spokeswoman Anita Larsen and Metro-Goldwyn spokesman Joseph Fitzgerald declined to comment, according to the report. Vivendi is disposing its U.S. Entertainment assets as part of a drive to pay down a EUR14 billion (US$15.9 billion) debt accrued during the acquisition spree of former CEO Jean-Marie Messier. VIVENDI UNIVERSAL: Sale of U.S. Asset Not Expected Before Autumn ---------------------------------------------------------------- The decision regarding the sale of Vivendi Universal's U.S. entertainment assets is unlikely to come before autumn, AFX said citing a report of La Tribune. This is despite the fact that Vivendi chairman Jean-Rene Fourtou is intensely pursuing his hunt for a buyer that could offer at least US$1.4 billion for the asset. Mr. Fourtou planned to remain in New York in the midweek, and sources close to him said, he might meet potential buyers as he officially visits the company's U.S. sites. Mr. Fourtou, who succeeded Jean-Rene Messier in the position, is undertaking disposals to unwind the debt incurred during his predecessor's shopping spree. He plans to put the proceeds of the disposal in his program to raise EUR16 billion (US$18.7 billion) by the end of 2004. ============= G E R M A N Y ============= ENERGIE AG: Recruits Neurkirchen to Assist CEO in Restructuring --------------------------------------------------------------- Energie Baden-Wuerttemberg AG, the South German utility that revealed worse-than-expected financial results following an audit, announced recently that it has enlisted the help of an outsider in conducting a restructuring. Dow Jones Newswires said Kajo Neurkirchen has been appointed by Energie Baden-Wuerttemberg to assist Chief Executive Utz Claassen as an outside advisor in increasing the operational efficiency of the company. Mr. Neurkirchen is the former CEO of mg technologies, who helped the company clean up its finances, Dow Jones reported. The recent audit uncovered potential drains on earnings and risks at Salamander and Thermoselect. It also underscored the burdens from the investment in Stadtwerke Dusseldorf AG and various other downward valuations resulting from impairment tests at holdings, provisions for early retirement, and provisions for restructuring measures. In response to these new insights, the company pledged to realize EUR1 billion in cost savings by 2006 as well as divest non-core and unprofitable businesses. CONTACT: ENBW ENERGIE BADEN-WURTTEMBERG AG Communications Department Durlacher Allee 93 76131 Karlsruhe Phone: +49 (07 21) 63-1 43 20 Fax: +49 (07 21) 63-1 26 72 E-Mail: unternehmenskommunikation@enbw.com INFINEON TECHNOLOGIES: Reports Flat Third Quarter Revenues ---------------------------------------------------------- Infineon Technologies AG (FSE/NYSE: IFX), the world's six-largest semiconductor manufacturer, announced results for its third quarter and first nine months of fiscal year 2003, ended June 30, 2003. The company had revenues from continuing operations of EUR1.47 billion, remaining almost flat sequentially and increasing 11% year-on-year. Quarterly net loss amounted to EUR116 million compared to a net loss of EUR328 million in the previous quarter and a net loss of EUR76 million in the third quarter of the last fiscal year. This strong sequential improvement is mainly due to increased productivity, further cost reductions and no significant inventory valuation effect compared to the previous quarter. The quarterly loss included impairment charges of EUR68 million, reflecting a goodwill write down of the company's interest in Catamaran Communications. The net loss also included a tax benefit of EUR10 million compared to a tax expense of EUR96 million in the previous quarter. Quarterly EBIT (which Infineon defines as earnings (loss) from continuing operations before interest, minority interest and taxes) significantly improved to a loss of EUR115 million, compared to a loss of EUR223 million in the previous quarter, but up from a loss of EUR 10 million in the third quarter of the last fiscal year. Dr. Ulrich Schumacher, President and CEO of Infineon Technologies AG commented: "Although we currently see a more positive market environment, especially for DRAM, last quarter still was very difficult due to the unfavorable Euro/Dollar exchange rate conditions and ongoing strong pricing pressure. However, we achieved a solid revenue performance in most of our business groups and significantly reduced our net loss by EUR212 million sequentially. Without the impairment charge our net loss would have been EUR48 million." Basic and diluted loss per share for the third quarter of fiscal year 2003 was EUR0.16, compared to a loss per share of EUR0.45 in the previous quarter and EUR0.11 year-on-year. Expenditures for Research and Development in the third quarter totaled EUR273 million, or 19% of sales, compared to EUR254 million in the second quarter. The sequential increase is mainly due to additional investments in our technology expertise for 3G as well as optical networking. SG&A expenses totaled EUR158 million or 11% of total revenues, down from EUR164 million in the previous quarter. The further decrease in these expenditures primarily reflects the effects of cost reduction measures taken by the company. On June 5, 2003, Infineon issued subordinated convertible notes due 2010 for gross proceeds of EUR700 million. The company decided to take advantage of the low interest rates available in the European convertibles market to improve its cash position. The notes may be converted into up to 68 million ordinary shares of Infineon Technologies AG. Infineon's gross cash position, representing cash and cash equivalents, marketable securities and restricted cash, amounted to EUR2.4 billion, up sequentially from EUR1.5 billion. The increase in gross cash was mainly due to the convertible bond. In addition, the company has decided to divest of its interest in ProMOS Technologies and from April 1, 2003 its investment in ProMOS is no longer accounted for on the equity method and is instead treated as marketable securities. Free cash flow, representing cash from operating and investing activities excluding purchases or sales of marketable securities, significantly improved from a negative EUR90 million in the previous quarter to a positive EUR11 million. This improvement mainly reflects higher operating cash flow and lower capital expenditures compared to the previous quarter. Revenues outside Europe in the third quarter constituted 57% of total revenues, up from 56% in the previous quarter. As of June 30, 2003, Infineon had approximately 31,600 employees worldwide, including about 5,700 engaged in research and development. Results for First Nine Months of Fiscal Year 2003 Total revenues for the first nine months of fiscal year 2003 were EUR4.4 billion, up 22% from EUR3.6 billion in the same period last year. Net loss amounted to EUR484 million, compared to a net loss of EUR515 million year-on-year. The company had tax expenses of EUR98 million during the first nine months of fiscal year 2003 compared to a tax benefit of EUR345 million during the comparable period of fiscal year 2002. EBIT for the first nine months of this fiscal year was a loss of EUR369 million, a significant improvement from an EBIT loss of EUR845 million year-on-year. Business Group Performance The Automotive & Industrial group's third quarter revenues were EUR351 million, a decrease of 1% sequentially but an increase of 14%year-on-year. The sequential decrease was due to a non-linear booking of license income in the previous quarter. EBIT remained flat sequentially at EUR49 million and increased from EUR29 million in the third quarter of fiscal year 2002. The segment maintained its high level of profitability mainly due to higher productivity, based on the ongoing conversion of production to 200mm wafers and the full utilization of capacities. Infineon has reached a leading market position in Europe for next generation engine management with its TriCore microcontroller technology. With particular strength in Asia, Infineon continued to increase its market share for power management & supply applications with CoolMOS and OptiMOS technology, mainly for computing. With the acquisition of SensoNor in June 2003, the company enhanced its product portfolio for advanced automotive sensor technology including magnetic, pressure and temperature as well as acceleration sensors. According to Strategy Analytics, Infineon's Automotive and Industrial segment continued to outperform the market in 2002 and increased its market share as the No 1 in Europe with a greater than 15% market share and the No 2 position worldwide with a greater than 8% market share. Wireline Communications revenues improved to EUR119 million in the third quarter, an increase of 6% from the previous quarter, and up 17% year-on-year. The sequential revenue increase was principally due to higher sales of access and fiber optic products. EBIT amounted to a loss of EUR99 million compared to a loss of EUR39 million in the previous quarter and a loss of EUR49 million year-on-year. Third quarter EBIT included an impairment of EUR68 million related to the acquisition of Catamaran Communications. Without this impairment the EBIT would have improved sequentially to a loss of EUR31 million, primarily resulting from improved gross margins. Infineon significantly strengthened its ADSL market position with further design wins of the company's Geminax-chipset technology at leading customers. The company also launched new fiber optics products such as the Triport-Bidi transceiver enabling the transmission of analog TV, telephony and high-speed Internet over a single fiber-optic link with first shipments to major customers. Secure Mobile Solutions' third quarter revenues were EUR387 million, an increase of 3% from the previous quarter and 18% compared to the third quarter of last year. The sequential quarterly revenue increase was mainly driven by security solutions and Local Area Wireless applications, particularly Bluetooth. The quarterly EBIT loss of EUR17 million improved from an EBIT loss of EUR23 million during the previous quarter but was down from a positive EBIT of 3 million for the third quarter of fiscal year 2002. The sequential improvement of EBIT loss was mainly due to increased sales volumes, particularly for security controllers. Infineon has strengthened its leading market position for national ID-projects and entered into a security cooperation with the German Federal Ministry of the Interior to establish a sound technology basis for an enhanced security level in Information Technology systems that are used in the Civil Service, in private companies and households. The company also introduced the high-performance SingleStone Bluetooth module for advanced Bluetooth applications used, e.g. in PCs, automotive, and consumer devices. In June 2003, Infineon and Ericsson signed an amendment to the acquisition agreement for the Ericsson Microelectronics business to strengthen their strategic cooperation in various areas of mobile phone and wireless infrastructure technology. The companies also agreed to a reduced purchase price and to eliminate the historic and future purchase thresholds of Ericsson and related penalties. The Memory Products group's third quarter revenues were EUR569 million, a decrease of 7% sequentially but an increase of 4% year-on-year. The sequential revenue decrease was mainly due to the unfavorable dollar/Euro exchange rate development, slightly declining average selling prices for memory products and, compared to the previous quarter, a lower deferred licensing income of EUR36 million. EBIT improved significantly to EUR2 million compared to an EBIT loss of EUR138 million in the second quarter and a loss of EUR22 million year-on-year. The strong EBIT improvement was mainly due to a faster than expected productivity increase from the 300mm production which compensated the unfavorable exchange rate and no significant inventory valuation effect. "We achieved profitability in our memory products group despite slightly declining average selling prices for DRAMs and maintained our favorable cost position in the DRAM market with our lead in 300mm volume production in Dresden where we have reached approximately 6,400 wafer starts per week," said Dr. Schumacher. Infineon has qualified the 256M DDR DRAM main volume product in 0.11 micron technology and achieved DDR400 validation for this product at Intel. Furthermore Infineon has received very good customer feedback for its samples of 1-Gbit Double Data Rate (DDR) Synchronous DRAM fabricated using the company's advanced 110nm CMOS process. The company together with IBM has developed the most advanced Magnetoresistive Random Access Technology (MRAM) and introduced the high-speed 128Kbit MRAM core which allows for faster access, more storage and less power consumption in PCs and laptops and could eventually replace today's common DRAM, SRAM and flash memory technology. Infineon together with Cypress and Micron Technologies also announced first CellularRAM samples for future mobile communications applications. Revenues in the other operating segment were EUR36 million, up 38% sequentially and up 50% year-on-year. EBIT was a loss of EUR14 million compared to a loss of EUR15 million in the previous quarter and a positive EBIT of EUR3 million in the third quarter of fiscal year 2002. In Corporate and Reconciliation EBIT in the third quarter improved to a loss of EUR36 million, compared to a loss of EUR57 million in the second quarter and a loss of EUR74 million year-on-year. The loss primarily reflects reduced unallocated idle capacity costs and corporate restructuring charges. Outlook for the second half of calendar year 2003 "We have seen first signs of a positive market trend in the last quarter and thus look forward with optimism for a stronger improvement of demand both in our logic segments as well as our memory products segment in the second half of calendar year 2003. In the light of the continuing uncertainty of the global economic situation, which makes it difficult to predict consumer demand in our target applications, we will continue to implement our successful cost reduction and restructuring programs," commented Dr. Schumacher. For its Secure Mobile Solutions segment, Infineon expects a further moderate increase of demand for GSM/GPRS mobile handsets and Bluetooth products. In addition, the company sees a positive development of demand for security solutions, particularly for ID-systems, but also expects overall continued pricing pressure. Agreeing with many industry analysts, Infineon expects further reductions in capital expenditures in the global wireline telecom infrastructure market in 2003, but continues to expect moderate growth in Europe. Infineon expects a further positive development of demand for broadband access technology, particularly in Asia. In the automotive electronics and automotive semiconductor markets, Infineon sees weaker demand. However, we anticipate this to be primarily a seasonal effect since the automotive electronics market is expected to grow further despite the current weakness in the overall automotive industry. For the logic segments as a whole, Infineon expects a further overall improvement in revenues as well as EBIT in the fourth quarter of fiscal year 2003. Infineon has seen continuously growing demand and steadily increasing prices for DDR memory products since the beginning of June 2003. Infineon expects a further positive development of demand mainly driven by gradually increasing corporate replacement investments, the upcoming back-to-school season and the move towards higher Megabyte per Box and DRAM demand due to the introduction of the new INTEL Springdale chipset offering Dual Channel DDR technology for computers. To See Financial Statements: http://bankrupt.com/misc/INFINEON_TECHNOLOGIES.pdf NORDDEUTSCHE AFFINERIE: Plans to Save Cost to Improve Results ------------------------------------------------------------- The supervisory board of Norddeutsche Affinerie AG met in an extraordinary session on July 21, 2003 after it became obvious that this year's results would be considerably lower than expected. In the difficult situation on the raw materials and product markets, the Norddeutsche Affinerie Group will presumably break even for the year as a whole although Norddeutsche Affinerie AG will remain in the profit zone. The main sources of the losses are Huttenwerke Kayser AG und Prymetall GmbH & Co. KG. The deterioration in market conditions, especially in the copper concentrate, copper scrap and continuous casting business, has now also affected Norddeutsche Affinerie AG. The situation on the raw materials side is aggravated by distortions in the international competition. The sale of Norddeutsche Affinerie products is suffering from the effects of the economic downturn and increasingly also from the strong Euro. In this difficult situation, Norddeutsche Affinerie is particularly hard hit by additional governmental burdens, e.g. in the energy sector. Norddeutsche Affinerie, as a company that uses energy intensively, is therefore, vehemently opposed to the increase in energy costs from the law on renewable energy. Norddeutsche Affinerie will seek to counter the sharp deterioration in the development of results of the Norddeutsche Affinerie Group with an efficiency enhancement and cost-cutting program, which has been passed by the management and supervisory board with an improvement potential totaling EUR80 million annually. Potential savings of more than EUR50 million have already been opened up by concrete steps and can be implemented rapidly. Further measures with a total potential of EUR30 million are still at the design stage. The program will take effect as from the financial year 2003/04. The target is that the NA Group should again obtain positive results in the financial year 2003/04 and resume its dividend policy. POET HOLDINGS: Operating Loss Up as Revenues Dive ------------------------------------------------- Poet Holdings, Inc. (Prime Standard, ISIN:US7304471094) announced financial results for the three months period ended June 30, 2003 (Q2/2003). Revenues for Q2/2003 decreased 12%, to US$1.7 million, as compared with revenues of US$1.9 million for Q1/2003. Revenues from the sale of products for Q2/2003 decreased 29% to US$0.9 million as compared with product revenues of US$1.2 million for Q1/2003. Total costs and operating expenses remained unchanged at approximately US$2.9 million. The operating loss for Q2/2003 increased 25% to US$1.2 million as compared with US$1.0 million in Q1/2003. Compared to Q2/2002 overall revenues decreased by 15%, product revenues decreased by 28%, total costs and operating expenses decreased by 41%, the operating loss decreased by 59% and net loss decreased by 77%. In the second quarter the company has made significant progress in completing its new Poet X-Solutions, the next generation of Poet's catalog solutions product line, which is scheduled to become generally available in August. The feedback received from customers and prospects during the beta-phase in previews and demos has been very encouraging. Since several prospects are waiting for the availability of X-Solutions, the catalog license revenues have decreased compared to the previous quarter. Therefore, the company expects a significant increase in license revenues from X-Solutions in the second half of 2003. License revenues attributable to eSupplier Solutions (eSS) for Q2/2003 decreased approximately 61%, to US$188,000 as compared with eSS license revenues of US$477,000 in Q1/2003. License revenues attributable to Poet's database product line, FastObjects, decreased approximately 8%, to US$686,000 as compared with US$746,000 in Q1/2003. Total service revenues increased approximately 17% to US$795,000 as compared with US$682,000 in Q1/2003. The company had cash and cash equivalents of US$9.5 million on June 30, 2003 and reinforces its projection to become cash-flow positive on a quarterly basis in Q4/2003. Further information on the comparison of Q2/2003 and Q2/2002, including the balance sheet and the statement of operations, can be found in this press release (http://www.poet.com). CONTACT: POET HOLDINGS, INC., S. Stoevhase E-mail: investor@poet.com Home Page: http://www.poet.com ============= I R E L A N D ============= AER LINGUS: To Fly Toulouse and Tenerife Routes Starting Oct. 26 ---------------------------------------------------------------- Aer Lingus, the struggling national airline of Ireland, has added Toulouse and Tenerife to its schedule of flights. Business Plus Online said Aer Lingus will start the two new routes on October 26, in addition to the five new routes already launched this year from Dublin to Washington-Baltimore, Lisbon, Bologna, Palma and Jersey. Fares start from EUR149 each way including all taxes for Dublin-Tenerife route, EUR79 each way including all taxes for Dublin-Toulouse. Schedules for the newly introduced routes and airfares quoted are available for booking at the company's website, on http://www.aerlingus.comfrom July 24. Aer Lingus has been struggling from the global economic slowdown, industrial unrest, decline in tourism, stiff transatlantic competition and rising fuel prices even before the September 11 attack. The tragedy only worsened its situation, leading it to post a EUR52 million- loss in 2001. In an effort to remain sustainable, the airline slashed its costs by EUR235 million as part of an emergency rescue package that also saw it decide to enter the low-cost sector. ========= I T A L Y ========= TELECOM ITALIA: Innovation, Research Keys to Growth --------------------------------------------------- With the aim of ensuring innovation and the development of technology and research in a common direction (this is the sector for which two thirds of the investments forecast for the three years 2003 - 2005 are earmarked), Telecom Italia intends to further consolidate Telecom Italia Lab's role within the Group. To this end, Aldo Olivari has been appointed CEO of Telecom Italia Lab. His nomination is oriented toward transforming the Group's research activities into a truly central point of reference on the main themes of strategic interest to individual Business Units, both by promoting the technological leadership of the Group itself and by exploiting collaboration with Pirelli Labs. An engineering graduate, Aldo Olivari boasts thirty years' experience in the telecommunications field, having held important posts at Marconi and then at Sirti as Managing Director. Simultaneously, Andrea Granelli will take charge, at a Group level, of innovation initiatives with national and international organizations. ===================== N E T H E R L A N D S ===================== ING GROEP: Sells Italian Network Activities to UniCredito --------------------------------------------------------- ING concluded an agreement with UniCredito Italiano and Aviva about the sale of its Italian agent network activities of ING Sviluppo as well as the affiliated Italian life insurance, asset management and private banking activities. The value of the transaction is EUR170 million. ING will continue to focus on the Italian retail market via ING Direct. The divestment fits into the ongoing process of active portfolio management at ING. It is expected that this transaction will be completed in the fourth quarter of 2003, including approval from the regulatory and supervisory authorities. "A key consideration for ING to divest ING Sviluppo and its affiliated businesses was to ensure the long-term growth perspective and providing the best future outlook for our clients, agents and staff. ING is convinced that UniCredito and Aviva will continue the strong support of the network, the current high quality of service as well as a broad product range, " says Michel Tilmant, vice-chairman of the Executive Board of ING Group and chairman of the Executive Committee ING Europe. ING will remain active in Italy with ING Direct, ING Bank (Wholesale) and ING Investment Management (Institutional Clients). NUMICO N.V.: Completes Sale of Brazilian Business to Kremon ----------------------------------------------------------- Royal Numico N.V. has completed the sale of the dairy activities of Mococa S.A. (Brazil) to Kremon do Brasil S.A., a Brazilian producer of food and cleaning products. The transaction price was not disclosed. The divestment of this non-core asset is in line with Numico's strategic objective to become a high-growth, high-margin specialized nutrition company by focusing on its core activities Baby Food, Clinical Nutrition and GNC. The dairy activities of Mococa S.A. generated approximately EUR40 million in sales in 2002 with a negative EBITA contribution. Numico will retain Mococa 's cereal brands and cereal operations, which generated approximately EUR15 million in sales and contributed positively to EBITA in 2002. =========== P O L A N D =========== HOOP: Shelves IPO as Rumors of Accounting Irregularities Mount -------------------------------------------------------------- Polish soft drinks producer, Hoop, has cancelled an initial public offering set last week after a small Internet broker, Poland Securities, accused it of accounting irregularities, according to Interfax-Europe. Hoop intended to launch the subscriptions for 5 million E-series shares and up to 1.5 million D-series shares on July 17 to 19 but decided against it after the broker alleged on its web site that the soft drinks maker has kept its poor financial situation secret. The shares, which are owned by current shareholders, were priced at between PLN23 and PLN29. They had been expected to trade publicly at the end of July or beginning of August. Hoop, which planned to offer shares mainly to international and Polish financial institutions, did not say when it intends to launch a new subscription period. It denied Polish Securities' accusations, and said it would launch legal actions against the author of the report. Hoop had quarterly sales revenues of PLN123.45 million in the second quarter, and net profit of PLN19 million last year. It has 10.089 million shares in trade on Poland's over-the-counter market. =========== S W E D E N =========== TELELOGIC: Sees Initial Signs of Recovery in Telecommunications --------------------------------------------------------------- Telelogic (Stockholm Exchange: TLOG), the leading global provider of solutions for advanced systems and software development, announced financial results for the second quarter 2003 ending June 30. Revenue for Q203 amounted to US$28.0 million (SEK223.5 million) compared with US$29.9 million (SEK290.0 million) in Q202. New licenses and maintenance revenues totaled US$22.7 million (SEK180.9 million) during the second quarter. At constant exchange rates the decline was 11% compared with the same quarter in 2002. New license and maintenance sales in local currency were slightly higher during the second quarter in comparison with the first quarter. Sales of new licenses and maintenance amounted to 81% of total revenues, which was in line with the previous quarter. Due to a restructuring of the company's professional services operations in 2002 to focus on product related business, Services revenues continued to decline and totaled US$5.3 million (SEK42.6 million) for the quarter The company's gross margin increased to 74.6% for the quarter compared with 71% for the same period 2002, including restructuring charges. Total costs, excluding taxes, continued to decline during the quarter and decreased 4% compared to the previous quarter. Pre-tax profit amounted to US$-2.0 million (SEK -15.9 million) compared to US$-0.4 million (SEK -3.2 million) for the same quarter last year. "While continued economic and political uncertainty made this another challenging quarter, we are seeing the very first signs of recovery for Telelogic in the telecommunications sector," said Anders Lidbeck, president and CEO of Telelogic. "Demand has stabilized and revenue increased 15% compared to the first quarter." In the second quarter American and Asia/Pacific operations continued to show good profitability for the period. Sales have increased in comparison with the first quarter of 2003. Telelogics European operation significantly increased profitability during the second quarter due to strong cost control measures that were initiated during the beginning of the quarter. These measures are having a positive effect on profitability without any significant impact on turnover. To position the company for future growth, Telelogic has continued to invest in new product development and global marketing. In the third quarter 2002, Telelogic introduced a new suite of development tools called TAU Generation2. In April, Telelogic TAU/Developer 2.0 received four out of five stars from Software Development magazine. The in-depth product review concluded that TAU/Developer is "great" and "probably belongs in your shop." In the second quarter, sales of Telelogic TAU increased 11% compared to the first quarter. Demand for TAU Generation2 tools has continued to increase during 2003. At the end of the quarter, Telelogic secured a US$1.16 million order from a major U.S. telecom equipment manufacturer for TAU Generation2 tools. License sales from this product family now make up 10% of all new license sales. Telelogic's configuration and change management solution Telelogic SYNERGY recently received the top ratings in six out of 10 categories in the latest configuration management report from U.K.-based industry analyst group Ovum. Among the 14 tools evaluated SYNERGY received the highest ratings overall and Ovum's top ratings in the three most critical categories: configuration management, build and release support and change management. "Our unwavering commitment to new product development is beginning to show positive results and should be the catalyst for growth as industry demand returns to normal," said Lidbeck. "Telelogic continues to solidify its market position and is well positioned when demand ramps up to more typical levels, despite a challenging global economy." Outlook for 2003 The underlying demand in the market is assessed as good and is expected to return to growth when the general investment climate improves. The prevailing economic situation, however, entails that investment decisions are being deferred and the investments made are being reduced in size. During 2003, Telelogic is taking measures to strengthen growth in the markets in the US and Asia. The company's goal is to strengthen its position in these markets and to at least retain its position on a global basis. During 2003, the company continues to focus on improving earnings and takes measures to create the conditions for achieving the goal set in 1999 of a 20% operating margin. A prerequisite for achieving this goal during 2004 is, however, that demand is strengthened. The forecast is that earnings before taxes for 2003 will improve in comparison with the previous year. During 2003, Telelogic will report any restructuring expenses as a part of current expenses. Telelogic has a satisfactory financial position. Cash flow is expected to be negative during 2003 but will develop positively as earnings before taxes improve. Cash flow is forecast to be positive in 2004. For additional information and the detailed quarterly report, please refer to: http://www.telelogic.com About Telelogic Founded in 1983, Telelogic� is the leading global provider of solutions for advanced systems and software development. The companys integrated best-in-class software tools and professional services enable companies to automate their entire development lifecycle, resulting in improved predictability and overall costs. To ensure interoperability with other leading third-party tools, Telelogics products are built on an open architecture and standardized languages. As an industry leader and technology visionary, Telelogic is actively involved in shaping the future of advanced systems and software development by participating in industry organizations like 3GPP, INCOSE, ITU-T, IEEE, MOST, OMG and others. Headquartered in Malmo, Sweden, with U.S. headquarters in Irvine, California, Telelogic has offices in 17 countries worldwide. Customers include Alcatel, BAE Systems, BMW, Boeing, DaimlerChrysler, Deutsche Bank, Ericsson, General Motors, Lockheed Martin, Motorola, NEC, Nokia, Philips, Siemens, and Thales. For more information, please visit http://www.telelogic.com. Telelogic, Telelogic DOORS, Telelogic DocExpress and Telelogic Tau are the registered trademarks of Telelogic AB. Telelogic Synergy and ActiveCM are trademarks of Telelogic AB. All other trademarks are the properties of respective holders. CONTACTS: TELELOGIC Anders Lidbeck President & CEO Phone: +46 40 174700 Catharina Sundelin VP Corporate Communications Phone: +46 40 174730 E-mail: catharina.sundelin@telelogic.com ===================== S W I T Z E R L A N D ===================== ASCOM: Transport Revenue Business Unit Wins Another Major Order --------------------------------------------------------------- Ascom's Transport Revenue Business Unit has won another important order, less than two weeks after receiving a large contract from the city of Montreal transport authority (Canada): Ascom Transport Revenue has been commissioned to equip stations of the French National Railways in the Paris region ("L'Ile de France") with automatic access control gates. Worth around EUR50 million (CHF76 million), the framework contract with French National Railways covers the delivery and installation of access control equipment as well as maintenance and servicing of the entire system for the next ten years. Over the next five years, Ascom Transport Revenue in France (Ascom Monetel) will be installing 1500 access control gates in some 120 French National Railways stations in the city and suburbs of Paris. Based on state-of-the-art technologies, the new access control systems are able to read magnetic cards as well as contactless smartcards. "Coming after the important order from Montreal which we announced at the beginning of July, this second contract worth over CHF76 million highlights the positive development that Ascom and the Transport Revenue Business Unit are experiencing," says Juhani Anttila, Chairman and CEO of Ascom. Successful collaboration In France, Ascom Transport Revenue has already been collaborating successfully with French National Railways: among other things, Ascom installed an integrated fare collection system for French National Railways in the eastern region of Paris. Other successful reference projects include the RATP public transport authority in Paris, the Milan transport authority in Italy, the Berlin public transport authority (Berline Verkehrsgesellschaft BVG) and the Swiss Federal Railways (Schweizerische Bundesbahnen SBB). "We won the contract thanks to Ascom Transport Revenue's ability to deliver tailored solutions and services based on strong technological know-how, coupled with our good collaboration with French National Railways," explains Riet Cadonau, Head of Ascom Transport Revenue. "This important order from Paris underscores Ascom's position as the Number One choice among the world's major public transport operators." Ascom Transport Revenue is among the world's leading providers of networked revenue collection systems for public transport systems, car parks and toll roads. The company's tailor-made customer solutions are the product of an intelligent combination of proprietary key components and standard modules. About Ascom Ascom is a solution- and service-oriented technology company that holds a leading market position in its selected business areas. Around the world Ascom plans, builds, services and operates secure, high-availability voice and data networks and develops solutions for integrated revenue collection systems. With a service-oriented portfolio and proven technology know-how, Ascom business units offer discerning customers tailor-made integrated solutions right the way along the value chain. Ascom is committed to profitable growth worldwide. Ascom registered shares (ASCN) are listed on the SWX Swiss Exchange in Zurich. ***** In 2002 in a difficult telecommunications market Ascom achieved revenues of CHF2,066 million. At the same time the Group reduced the loss compared with the previous year by almost 30% to CHF281 million. CONTACT: ASCOM Corporate Finance Ascom Management AG Rudolf Hadorn, Chief Financial Officer Stettbachstrasse 6 CH-8600 Dubendorf Phone: +41 1 631 14 15 Fax: +41 1 631 28 00 E-mail: investor@ascom.com Home Page: http://www.ascom.com =========================== U N I T E D K I N G D O M =========================== AWG PLC: Lists Additional Shares on London Bourse ------------------------------------------------- Pursuant to AWG Plc's Share Option Schemes options over 31,942 Ordinary Shares of 19,181/201p each under the AWG Sharesave Scheme; and 5,590 Ordinary Shares of 19 181/201p each under the AWG Executive Share Option Scheme have been exercised. Accordingly, application has been made to The U.K. Listing Authority for these shares to be admitted to the Official List and to the London Stock Exchange for these shares to be admitted to trading. The Shares rank pari passu with the existing issued shares of the company. ***** AWG chief executive Chris Mellor stepped down from his post in March following 24 years of service -- a move understood by analysts to clear the way for the break-up of the business. Mr. Mellor was behind the GBP263 million purchase of Morrison construction group in 2000, an investment that has produced losses and write-downs of about GBP100 million, analysts said. CONTACT: David Turner AWG plc Phone: 01480 323580 BRITISH AIRWAYS: Meeting with Trade Unions Fails to Reach Deal -------------------------------------------------------------- British Airways on Tuesday met with representatives from Amicus MSF, TGWU and GMB trade unions to continue talks about the introduction of Automated Time Recording. The trade unions have stated that they do not agree with the airline's decision to introduce Automated Time Recording and that is their final position. British Airways is extremely disappointed that no understanding has been reached and that the trade unions decided to walk away from the talks. The airline has made every effort to understand their issues and to try to find a solution. The airline offered to postpone the introduction of Automated Time Recording until both sides had successfully negotiated the 2003 pay deal but this was rejected. The airline will progress with the planned introduction of Automated Time Recording with effect from noon, Wednesday, July 23 when staff can use the new system for themselves and see that there is nothing to worry about. Although talks have broken down, each of the three trade unions have formally advised British Airways that they do not support any unofficial industrial action. British Airways has told the trade unions that it remains willing to sit down with them and discuss any issues that they want to raise at any time. The airline is asking staff simply to switch from their current paper-based method of signing in and out to a modern day swipe card electronic system. The airline needs to record accurately who is at work and also it is important from a health and safety perspective. This system will enable us to do that. The introduction of Automated Time Recording does not constitute a change to our employees' terms and conditions of employment. Nor will it reduce or change employee pay. The airline has guaranteed that Automated Time Recording will not be used as a way of introducing annualized hours, an issue raised by some of our staff. More than 2,000 of our staff at Heathrow already use Automated Time Recording and have been doing so for nearly three years. British Airways will continue to spend time with staff, reassuring them about the new system and answering any concerns that they may have. Many U.K. companies use the system. BULLOUGH PLC: Cancels Listing on Alternative Investment Market -------------------------------------------------------------- As announced on June 18, 2003, following the Increased Offer by Tobull Limited being declared unconditional in all respects, the dealing facility in Bullough Shares on the Alternative Investment Market was cancelled at the close of business on July 22, 2003. The directors of Bullough accept responsibility for this announcement. ***** On May 13, 2003, Tobull (a wholly owned subsidiary of Montpellier) published an offer document containing details of a recommended increased cash offer made by Rowan Dartington & Co. Limited on behalf of Tobull to acquire the whole of the issued and to be issued ordinary share capital of Bullough, other than the 15,876,318 Bullough Shares already owned by Tobull, representing approximately 29.85% of the issued share capital of Bullough. CONTACT: BULLOUGH PLC Claes Piehl Executive Chairman, Phone: 020 7522 3206 CORDIANT COMMUNICATIONS: Shareholders OK Scheme of Arrangement -------------------------------------------------------------- Cordiant announces the results of the four shareholder meetings held on July 23, 2003. At the extraordinary general meeting earlier relating to the proposed disposal of FD International, the transaction was approved. Completion is expected to take place Thursday following the receipt on Wednesday of the German Federal Cartel Office's approval. The Board is pleased to announce that at the Court meeting and extraordinary general meeting relating to the proposed acquisition of Cordiant by WPP Group plc by means of a scheme of arrangement, shareholders overwhelmingly approved the Scheme and the Special Resolution in connection with it. At the requisitioned extraordinary general meeting to consider the resolutions proposed by Active Value, resolutions 1, 2 and 3 relating to removal of certain Directors were passed by shareholders. As a result David Hearn and Andy Boland have left the Board, but continue in their roles as Group Chief Executive and Group Finance Director. Nigel Stapleton has also left the Board, and has been replaced as Chairman on an interim basis by Rolf Stomberg. The continuing Board would like to thank all three directors for the significant contribution each has made to the Group. Although a significant majority of the votes cast by shareholders other than Active Value were in favor of retaining the three Directors, Active Value's votes for removal were sufficient to pass the resolutions. Resolutions 4,5 and 6 were removed from the agenda following the withdrawal of those individuals that Active Value had proposed would be the replacement senior management team. Given the timeline through to completion of the Scheme, Cordiant will not be seeking to appoint new Executive Directors as both David Hearn and Andy Boland will continue to retain the same duties and responsibilities as before, save for their Executive Directorships. The remaining requisitioned resolutions numbered 7 and 8 were also passed. However, these resolutions were framed to deal with a situation, which has been superseded by events, and are inconsistent with the overwhelming approval by Cordiant shareholders (including Active Value) of the Scheme. Therefore they are of no practical effect. The Court Hearing of Cordiant's petition to sanction the Scheme will take place on July 31, 2003. Subject to the Scheme receiving the sanction of the Court at that time, the effective date of the Scheme is expected to be August 1, 2003. Dealings in the new WPP shares to be issued as consideration to Cordiant shareholders are expected to commence on 1 August 2003. CONTACT: COLLEGE HILL ASSOCIATES Alex Sandberg Adrian Duffield Phone: 020 7457 2016 EASYJET PLC: Trading in Line with Interim Result Outlook -------------------------------------------------------- As promised, easyJet plc is providing an update on trading for the summer months. Commenting on summer trading, Ray Webster, Chief Executive, said: "We have had a good summer to date and the current level of forward bookings for the remainder of the financial year is showing strong growth and, importantly, currently demonstrates similar load factors to those seen at the same time last year although at marginally lower average yields. However, we remain highly dependent on the final quarter's trading, in what are still uncertain market conditions, for the achievement of our full profit potential. Management continues to focus on reducing costs and enhancing ancillary revenues. "easyJet continues to see good growth opportunities throughout Europe and is well placed to take advantage of these with its particular low-cost model. Over 80 airports responded to our tender for network expansion and a shortlist has been drawn-up from which we will select those to support our planned expansion in continental Europe." Statutory figures for the three months ending June 30, 2003 For the quarter to June 30, easyJet's trading has been in line with the outlook statement contained in the Interim announcement on May 7. High load factors were maintained and, while yields in the third quarter continued to come under some pressure compared to last year, the relative reductions have been less than those seen in the first half of the company's financial year. Yields As planned, the slower rate of capacity increase has contributed to reduced pressures on yields. The average fare achieved in the third quarter was GBP46.08, representing a decline of 2.8% from the comparable period in the prior year. This is an improvement upon the decline seen in the first half of the financial year. Passengers and load factors The load factor for the third quarter was 84.8%, an increase of 1.8% points from the figure of 83.0% for the corresponding period in 2002. Passenger numbers in the three-month period were up 98% to 5.223 million, which is in line with the planned increase in capacity. Available Seat Kilometers were 5.5 billion in the period, an increase of 118% and Revenue Passenger Kilometers were 4.7 billion, an increase of 123%. The average sector length was 896km, an increase of 12.6%. Note: Pro forma figures for the three months ending 30 June 2003 The average fare for easyJet and Go in the comparable period for 2002 was GBP47.09. The average load factor was 82.3% on passenger numbers of 4.287 million. Available Seat Kilometers were 4.4 billion in the period, and Revenue Passenger Kilometers were 3.7 billion. The average sector length was 854km. ***** easyJet plc generated a loss before tax, goodwill and non- recurring items for the six months ended March 31, 2003 of GBP24 million, which compares to a reported profit of GBP8.3 million for the same period in the prior year. The loss after tax for the period was GBP46.9 million, which compares to a reported profit of GBP0.8 million in the same period of the prior year. CONTACT: EASYJET PLC Toby Nicol, Corporate Communications Phone: +44 (0) 1582 525 339 Chris Walton, Finance Director Phone: +44 (0) 1582 525 336 FREMONT INSURANCE: Declares Fourth and Final Dividend ----------------------------------------------------- Notice is hereby given that a fourth and final dividend of 3.34% of Scheme Creditors Ascertained Scheme Claims has been declared in its scheme of arrangements bringing total dividends declared to date 38.34%. Dividend checks in respect of those claims that have been agreed will be dispatched to Scheme Creditors shortly. CONTACT: FREEMONT INSURANCE COMPANY (U.K.) Limited Plumtree Court, London EC4A 4HT United Kingdom DN Rackham and MC Batten LE MERIDIEN: Royal Bank Backs Guy Hand's Offer ---------------------------------------------- Royal Bank, which owns 11 of Le Meridien's U.K. hotels, is understood to favor a revised rescue plan from Guy Hands that would see troubled Le Meridien receive GBP150 million in new equity, the Financial Times said. Private equity financier Guy Hands is using is investment vehicle, Terra Firma, in a proposal that could see Saudi billionaire Prince Al Waleed inject GBP120 million in addition to the GBP30 million it would shoulder. The plan, though, still needs approval from the group's 14 senior bank lenders. It is the latest version of the rescue package previously dumped by lenders. It will provide a higher payment of 250 basis points above Libor - the benchmark for floating interest rates. Banks would receive 10% of the company but not have to write down any debt. Works on the rescue plan started after Le Meridien missed a GBP100 million repayment to its main lenders. The creditors are owed an estimated GBP750 million by the hotel group. LONDON FORFAITING: Sell-off Talks Make Substantial Progress ----------------------------------------------------------- On 14 July 2003 it was announced that the company was in exclusive negotiations with a counterparty. The counterparty, which is a regulated and listed entity in its own jurisdiction, has made further substantial progress this week in its bid preparations. The counterparty's due diligence is now complete. The counterparty concerned has requested that the exclusivity agreement be extended until 5.00 p.m. on Wednesday July 23, 2003. The Board of the company has agreed to this further extension on the basis that the counterparty continues to be interested in making an offer at 29.5 pence per share in cash and that the counterparty expects to announce firm proposals by the date to which exclusivity has been extended. The exclusivity agreement was entered into on the basis of an indicative offer price of 29.5 pence per share in cash. Such an offer, if made, would value the company at approximately GBP31 million. The proposed offer is subject to a number of pre-conditions including the recommendation of the Board of the Company and support from certain of the Company's larger shareholders. It is emphasized that no formal offer has at this stage been made and there can be no certainty that such a firm offer will be made, even in the event that the preconditions are satisfied or waived. Any offer by the counterparty, if made, will be in cash at not less than 29.5 pence per share, save in the event of an announcement of a firm intention to make an offer by a third party or unless otherwise agreed by the directors of the company. The counterparty, which is a bank, has requested not to be named in this announcement. The counterparty's financial adviser, WestLB, has reviewed this announcement. Upon release of this announcement WestLB will be contacting certain of the company's shareholders seeking irrevocable undertakings to support the proposed offer. A further announcement will be made as soon as practicable. Shareholders who are in any doubt about the action they should take should consult immediately their stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorized under the Financial Services and Markets Act 2000. ***** London Forfaiting put itself up for sale last year after a string of profit warnings and bad debts following problems in Russia and South East Asia. CONTACT: LONDON FORFAITING Phone: 020 7481 3410 Jack Wilson/Stathis Papoutes KINMONT Phone: 020 7493 8488 Gavin Kelly/Fraser Shand HOGARTH PARTNERSHIP Phone: 020 7357 9477 Nick Denton/Andrew Jaques WESTLB Phone: 020 7020 5210 Frank Malone NETWORK RAIL: Members Want More Audience with Board --------------------------------------------------- Network Rail members were expected to demand more meetings to discuss situations at the company in order to put more pressure on the board regarding its management of the rail operator. Peter Gavan, one of the 51 individual members and head of communications at Severn Trent, the water company, said: "One formal meeting a year is not an appropriate way to organize people who are very interested and want to fulfill their responsibilities." Members comprising half of Network Rail's 114 members convened Tuesday ahead of the company's annual meeting where they were expected to present their demand. "Nobody is happy with the present arrangements. We need something of more substance," Mr. Gavan said. The members were also expected to vote on the election and payment of Network Rail directors. The vote though is not binding on the board. THOMAS COOK: Plans to Cut Hotel Capacity in Winter, Next Summer --------------------------------------------------------------- Tourism company Thomas Cook plans to deeply cut hotel capacity this winter and next summer as a part of a plan to increase profitability, according to The Scotsman. The move shows it was also affected by overcapacity that plagues the German travel market. Tourism in the country is beset by overcapacity in hotel beds and flights, aggravating the effects in travel of the SARS virus, the war in Iraq and sluggish economies. The company is pursuing a program aimed at saving EUR600 million over the next two years starting January. It did not rule out the possibility that deeper job cuts could be undertaken at its German locations. Last month it also announced it would reduce its fleet by as many as 13 planes. Thomas Cook posted a EUR120 million after-tax net loss for 2001/2002. CONTACT: THOMAS COOK AG Corporate Communications Phone: ++49(0)6171 / 65-1700 Fax: ++49(0)6171 / 65-1060 Home Page: http://www.thomascook.info TRINITY MIRROR: Braces for Strike at Scottish Titles ---------------------------------------------------- Trinity Mirror could face a possible industrial action from workers at its Scottish titles Daily Record and Sunday Mail over plans to rationalize operations. Print and publishing workers from the two newspapers were balloted on Tuesday for a possible protest, according to the Financial Times. Scottish union leaders claimed at least 19 jobs are in danger at the newspapers under the company's restructuring, which is feared to also erode the "Scottishness" of the two Glasgow-based newspapers. Trinity Mirror chief executive Sly Bailey is due to present the company's strategy following a six-month review. According to the report, the company said any job losses would be below double figures. TRINITY MIRROR: Peddles Northern Ireland Affiliates --------------------------------------------------- Newspaper publishing group Trinity Mirror has approached Clydebank-based regional radio and newspaper business Scottish Radio Holdings regarding the sell-off of its Northern Ireland newspapers last month, according to The Herald. The report cited a source saying the approach was very informal and designed to see if there was any interest in buying the Northern Ireland newspapers, which analysts valued at between GBP30 million and GBP40 million. The publisher evaluated the possibility of selling the title last month as it reviews the operation in a bid to turn the firm around and revive sales in both national and regional newspapers. The titles include the Belfast News Letter, Derry Journal and six other titles. Scottish Radio Holdings had told Trinity Mirror it is only interested in the Journal, dubbed as the most influential newspaper in the north west of Ireland. The bi-weekly Journal sold 25,000, according to the most recent figures available. The paper published by Derry Journal Ltd. is most dominant in the local market. Senior Scottish Radio Holdings managers are understood to be uncomfortable about buying the News Letter due to the political issues enveloping it. It is under attack by its fiercely Protestant base because of some editorial lines, which back David Trimble, the moderate Protestant leader, according to the report. While a Trinity spokesman declined to comment, sources close to the company refused to admit sell-off plans for the papers ahead of the unveiling of the company's strategy on Thursday. ********** S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter -- Europe is a daily newsletter co-published by Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard Group, Inc., Washington, DC USA. Larri-Nil Veloso, Ma. Cristina Canson, and Laedevee Gonzales, Editors. Copyright 2003. All rights reserved. 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