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Psion changes take toll
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August 29, 2001: 7:07 a.m. ET
Psion looks ahead to improved performance after restructuring
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LONDON (CNN) - Mobile networking company Psion reported that the cost of ditching what was once its main business drove it into loss in the first half.
The UK company pioneered the development of palmtop computers in the 1980s, but said earlier this year it was pulling out of that market. It ran up £41 million (59.5 million) in costs for the resultant reorganisation.
Psion reported a net loss of £54.5 million in the six months to June, compared with a £2 million profit a year earlier. The figures included redundancy costs after 350 jobs were cut.
The loss per share came to 13.1 pence, against a 0.5 penny-a-share profit last year.
Psion chairman David Potter said: "The group is in the process of major and radical change, while aiming to remain true to its traditions, both of technological innovation and of delivering value to shareholders.
"The Board expects an improved performance from the restructured group going forwards... and expects the full benefits of this year's restructuring will become apparent in 2002."
Psion ditches PDA market
The London-based firm, formerly Europe's biggest handheld computer maker, said last month it would no longer produce personal digital assistants (PDAs) in the face of slowing demand and increased competition from U.S. companies Palm (PALM: Research, Estimates) and Compaq (CPQ: Research, Estimates).
The group has since focused its attention on industrial and enterprise markets through Psion Teklogix, on the innovation of slimline products in Psion Digital and on its investment in Symbian, which develops and markets operating systems for smart phones.
Psion spun off its former software unit Symbian three years ago as a joint venture with mobile phone giants Nokia and Motorola. It will be seeking further funding for Symbian in the first half of 2002.
Psion holds a 28 percent stake in Symbian, and said the private company's shareholders remain committed to a flotation of the group "in due course".
Shares in Psion were down 5.8 percent in late morning trade on London's FTSE mid-250 index. 
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