The chairman of Synapse Computer Services Plc, Michael Godman, believes that his company has gone through the worst of its financial difficulties – it reported a pre-tax loss of UKP249,000 at the interim stage which, at the year end, has only grown to a pre-tax loss of UKP332,000 after exceptional costs of UKP326,000. The exceptional costs relate to two anticipated contracts in the US which were written off leading to the loss of preparatory work worth UKP129,000, while redundancy and compensation costs to address the drop in market demand came to UKP197,000. Synapse attributes its losses to a reduced demand for Systems Programming support in the UK and a lack of conversion sales in the US. Consequently, it is the UK Systems Programming unit that has taken the bulk of the staff cuts, while the company’s US conversion activities have been reorganised to take advantage of alliances with other companies. During the year Synapse acquired Beacon Management Services Ltd, a mid-range services company, and set up an Italian office which has, subsequent to year end, been converted into a wholly-owned subsidiary. Meanwhile, application programming services to mainframe users were discontinued and plans to set up a recruitment agency were decided to be non-strategic and were abandoned. As for the future, Synapse believes that IBM’s ES/9000 announcement will lead to a great deal of activity in the mainframe market. In particular it says that 50% of its IBM VSE users intend to act immediately to take advantage of IBM’s announcement that VSE is now part of SAA – but only if IBM offers a tempting upgrade price.
