Logica upbeat after investor fears

August 7, 2001 Posted: 0947 GMT

LONDON, Aug 7 (Reuters) - British IT services and software group Logica (LOG) on Tuesday cheered the market with a rosier outlook for this year and next, sending its shares higher.

Logica, despite feeling the pinch of a slowdown in the mobile text messaging craze, discarded market rumours that it was getting ready to warn investors on its performance and said its order intake remained healthy.

It also said its recently aquired German unit, which it admitted in June of disappointing growth, had perform well.

"Logica will report another year of strong earnings growth in line with market expectations," the company said in a statement. It will reveal fuller details on September 5 when it reports its results for the year ended June 30.

"Strong order intake growth in 2000/01 and Logica's key performance indicators underpin its confidence in continuing strong financial performance for the year to June 2002," it said.

Logica shares, which have fallen almost 60 percent this year, was up 3.1 percent at 739 pence after rising as high as 755 -- but still far off the peak of almost 30 pounds reached at the height of the technology boom early last year.

GERMAN UNIT IS NO WORRY

The group said its German unit Logica pdv had achieved margins well above the group average.

Last month, Logica's managers from around the world met for an annual conference in Hamburg, the headquarters of Logica pdv, and were upbeat both for Logica pdv and for the rest of Logica's business, it said.

It said other acquisitions made during the year were also making good progress.

Logica shares have underperformed the UK software and computer services sector <.FTCS> by 14 percent this year and the FTSE All Share <.FTAS> index by 54 percent.

Logica said in June that the acceleration in its mobile networks business, which mainly provides software for text messaging, was showing signs of slowing from recent annual growth of 80 percent.

But other businesses -- which include IT services to the energy, utilities and financial sectors -- were expected to do better.

The group has said it is on track to meet market expectations of an annual pre-tax profit of 149 million pounds ($210.6 million).

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