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Europe's NewMedia Spark considers ‘radical action' in light of disappointing results

NewMedia Spark, the listed European venture capital firm, has suffered further write-downs and losses and is considering taking ‘radical action' to get itself back on track.

The firm saw the value of its portfolio plummet by 64 per cent for the year ending 31 March 2002, from £109.7m to £38.8m, blaming the results on the decline of the TMT sector and ‘extremely difficult market conditions'.

It also wrote down to zero the value of its largest single investment in eTV holding.

‘It is clear that in present market conditions SPARK must adjust its course and that radical action is required to maximise shareholder value. We are therefore instituting further very substantial cost cuts, closely controlling new expenditure and exploring ways of returning surplus cash to shareholders,' said Mike Whitaker, chief executive.
 
It also announced it will not be making any further investments in the beleaguered TMT sector.

‘The fact is that SPARK's investors do not currently wish to see SPARK utilising its cash resources to make further investments in the sector, despite low valuations, and as a public company SPARK must take account of, and respond to, this sentiment,' said the firm in a statement.

The results suggest we are still seeing substantial fall-out from the technology crash, despite a few tentative signs of recovery over the past few months.

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