Apple recovery on track - chairman

 

APPLE Computer said yesterday that its three-year turnaround plan was still on track despite the company's statement last week that it will report a first-quarter operating loss of as much as $150 million (£89.8 million).

Apple Chairman Gilbert Amelio, giving the keynote address for the 13th annual MacWorld Conference in San Francisco, said the first-quarter shortfall was largely due to market conditions rather than a problem with the company.

He said Apple's cash position remains at around $1.7 billion.

"We're in a good position," Mr Amelio said, referring to the Cupertino, California-based company's financial resources. Apple employs over 1500 at it's plant in Cork.

The first quarter "was about retail sales, not about the fundamentals in the recovery of Apple", Mr Amelio told a packed ballroom. "We had one thing that really fell out of bed in a big way and that is, Santa Claus forgot to come," he said, referring to the surprisingly low sales of its Performa desktop PC line.

Although the financial shortfall was a disappointment, Mr Amelio said it would not require any change in the company's turnaround plan and that all of the strategic decisions made under his leadership were still applicable.

"The three-year plan that I've been talking about since May is still solid," he said. Under the plan, Apple seeks to return to sustainable profits in 1998.

Mr Amelio encouraged software developers and customers not to give up hope despite the first-quarter setback.

Apple's stock edged down 12.5 cents to $17.75 on Nasdaq in late trading.