Gilbert Sedbon/PARIS
FRENCH DEFENCE-electronics giant Thomson-CSF has swung firmly back into profit, further fuelling interest in the Thomson group's privatisation, due to take place this year.
Thomson-CSF, now freed from the liabilities of its stake in the troubled Credit Lyonnais bank, produced a net profit of more than Fr1 billion ($200 million) in 1995. The performance came despite a 2.4% drop in sales to Fr35.5 billion.
The result contrasts with the heavy losses of the past two years. In 1994, the group had a deficit of nearly Fr1 billion, reduced from Fr2.8 billion in 1993. The losses at state-owned Credit Lyonnais, in which Thomson-CSF held 19%, had dragged the company into the red, but a deal has since been arranged with the French Government to relieve the burden.
Thomson-CSF's profitability also throws into relief the continuing troubles of the Thomson Multimedia consumer electronics business, its sister company. The Multimedia arm saw losses double to Fr1 billion, and its debt now stands at Fr14 billion, compared with Fr2.3 billion at Thomson-CSF.
The group as a whole is burdened with debts totaling Fr25 billion, which cost around Fr1.5 billion a year to service.
Former Thomson chairman Alain Gomez had pressed for the defence-electronics business to be privatised independently, apparently pushing for a link with the UK's GEC, but resigned in February when the Government insisted on selling the group as a whole. Thomson owns a controlling 58%, in the defence subsidiary, with the rest held by investors.
Marcel Roulet, newly appointed chairman at Thomson, says that a link with GEC would have proved a block to the privatisation process. He appears not to rule out alliances taking place within France after the privatisation, however. Matra Defense is eyeing up the defence business and Alcatel Alsthom is also widely tipped as a likely suitor.
Source: Flight International