APCC's results are a mixed bag

Datacentre technology provider American Power Conversion Corporation (APCC) has reported mixed results for its third quarter ended 24 September 2006.

Datacentre technology provider American Power Conversion Corporation (APCC) has reported mixed results for its third quarter ended 24 September 2006.

Revenue for the quarter was a record £317.4m, up 21% year-on-year and up 11% sequentially from the second quarter 2006.

However, net income for the third quarter 2006 was £23m, down 7% year-on-year. It was, though, up an impressive 83% from the £12.6m income from the second quarter of 2006.

APCC offered in mitigation for the dipping net income £3.1m in costs. These consisted primarily of employee severance costs, associated with workforce reduction actions announced in June and September; £760,000 for severance payments to the company's former president and CEO; and a net tax benefit of £6.6m associated with the adjustment of income tax provisioning resulting from recent tax audits.

In terms of technologies in the third quarter, revenue in APCC's Large Systems segment – which consists primarily of 3-phase uninterruptible power supplies, APC Global Services, precision cooling and ancillary products for datacentres, facilities and communication applications – increased 35% year-on-year to £69.4m.

Mixed results for sure. APCC should also look at the margins it makes on the high-end products and there will be more employee severance costs in Q4.

However, industry demand for the products APCC makes is high, especially for products concerned with powering and cooling datacentre a ken issue for all industries across all sectors.

Comment on this article: computer.weekly@rbi.co.uk

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