Palm-top PCs boost profits at Psion

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The Independent Online
PSION'S range of new palm-top computers, the Series 3 and 3a, helped to produce a growth in sales and a near-trebling in pre-tax profits at the interim stage, writes Diane Coyle.

Pre-tax profits were pounds 2.92m in the six months to 30 June, compared with pounds 1.07m in the first half of last year. Sales were 57 per cent higher at pounds 28.28m. The shares in USM-listed Psion jumped 11p to 285p on the news.

Demand in Britain and Europe was strong, with revenues rising 105 per cent to pounds 16.73m. The Series 3 range is replacing the original Psion Organisers, whose sales fell 15 per cent to pounds 4.05m.

Sales of credit card-sized modems, which meet new PC standards, increased from pounds 2m last time to pounds 3.69m this year as exports to Europe rose.

The group has set up a distribution network to tackle the US market and has recently signed distribution contracts with national retail chains Radio Shack and Office Depot to bring its number of US outlets to 1,500.

UK retail sales climbed from pounds 4.62m to pounds 8.4m. David Potter, chairman, said corporate demand was showing clear signs of recovery, particularly on the Continent.

Psion increased its research and development spending by 52 per cent to pounds 1.43m in the first six months of the year. Mr Potter said the group planned to increase the proportion of turnover spent on R&D from 5 to 7 per cent. Psion would soon introduce new products for the corporate market and communications products.