ERG plans to cut costs, boost profits

COST cutting and profitability are key goals of Dr Allan Sullivan, the new chief executive of smartcard technology company ERG.

In an interview with, Dr Sullivan, who was appointed to ERG in January, was bullish about the company’s future, referring to ERG’s “solid order book” with projects under way in Sydney, Seattle and San Franscisco, Washington DC and Stockholm.

“Beyond the current projects there’s a very active market for our technology, with the prospects we estimate to have an aggregate value exceeding $1 billion,” Dr Sullivan said.

“My overriding priority is to return the company to profitability, sustainable profitability. So I’m focusing on developing a three-year strategic plan to ensure we achieve that.

“We expect to produce a positive EBIT, net profit and operating cash flow in the 2005 financial year.

“As a first step it’s critical we deliver our current major projects on time and budget. I’m very focused on our project management and delivery processes, and believe we can make improvements in this area.

“The better we are in this regard, the lower our costs of goods sold will be. There is also room to take more overhead costs out of the business. We’ve cut cost considerably over the past 12 months and I’d like to take that further.”

ERG has suffered difficult times in the past two years, last month reporting an interim net loss of $43.03 million that included one-off write downs and provisions of $36.2 million.

Last year, the company also missed out on the WA government tender for Perth’s SmarTicket project – a smart card-based public transport ticketing system.

Phelps’ new role with the ACS

THE Australian Computer Society has appointed former Australian Medical Association president Professor Kerryn Phelps as a consultant.

In the part-time role, Dr Phelps will mentor the ACS and its senior administration to be a more efficient and effective voice for the ICT sector.

 “Kerryn successfully repositioned the AMA to be an articulate, relevant and effective representative of the medical professional, through internal cultural change and carefully crafted media relations,” ACS national president Edward Mandla said.

“With her guidance and experience, I believe the same model will reposition the ACS to effectively articulate the voice of the ICT professional.”

NetComm to supply WestNet’s ADSL

INTERNET service provider WestNet has appointed Sydney-based NetComm as its exclusive supplier of ADSL products in a deal that should boost NetComm’s sales by around $3 million over three years.

In a statement, NetComm said the deal with WestNet was a major win for the company and that its broadband solution was chosen for offering the lowest overall cost.

The company’s products feature unique, locally designed software tools for speeding up and simplifying configuration, significantly reducing after sales support costs.

“As a result of our deal with NetComm we have been able to achieve greater efficiency in providing hardware and associated support to our members,” WestNet managing director Peter Brown said.

Wavenet deals with $1m in orders

WIRELESS technology company Wavenet International has announced that it has received orders with a total value of $1 million for its wireless modems from three corporations in the US.

The Burswood-based firm said the bulk of the modems would be deployed in a fleet management solution.

“We now have a backlog of $3.4 million for modems and good prospects for additional orders going forward,” Wavenet managing director John Thompson said.

“More importantly for us, though, is the quality of customers now being signed up.

“These companies have volume and consistent demand for our technology going forward.”



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