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Spain's Amper Bucks Nuevo Mercado Lows

As New Economy giants like Cisco and Nortel Networks weather a downward trend, Spain's top telecommunications equipment supplier boosted investor confidence this week with earnings it expects will only get better.

Amper [www.amper.es], the premiere national supplier to Spain's burgeoning telecommunications infrastructure, announced Thursday that its total sales last year had increased by 54.3 percent to 5.5 billion pesetas ($275 million). Before-tax profits skyrocketed over twelve months from $2.6 million to roughly $14 million.

Investors on Spain's Nuevo Mercado reacted today with a 7 percent price surge, with Amper shares going for a high of EUR 8.13 and bucking the index's overall drop of more than 4 percent. While a 7 percent fluctuation may not be much for indices like the Nasdaq, such a surge is on the high end for Spain's high-tech, high-growth index.

Faced with a reported decline in demand for cable and unmet expecations by certain industry leaders, U.S. investors on a high-fiber diet are hardly eating high on the hog. In Spain, where the majority remains unwired and where broadband wireless is touted as the wave of the future, Amper is living up to some analysts' expectations and creating optimism.

"I think we're on the verge of what we could call our 'golden era," Amper spokesman Alberto Martinez said in a phone interview recently.

According to Martinez, while Spain's telecom liberalization begat dozens of new players in the national market, a lot of their investments went into advertising to create brand names that Spanish consumers would recognize. The lagging investment in infrastructure will have to be made up over the next couple of years, he asserted.

Amper was for years an equipment supplier to Telefonica, with the former state monopoly accounting for virtually all of the company's business. Today, Amper is a "multi-vendor, multi-client and multi-technology company," with clients like the new fixed operators Uni2, Retevision, and Jazztel, as well as mobile concerns like Airtel and Ericsson.

The Spanish supplier is taking an active role in the creation of Spain's nascent wireless broadband network, and has entered into strategic relationships with world industry leaders like Lucent Technologies and Motorola.

The origins of Amper's turn-around have been traced back to 1999, when the company divided into two branches. Along with its defense communications interests, Amper Tecnologias takes on new projects with high growth potential and makes strategic, tech-oriented investments. Amper Soluciones offers systems integration for telecoms mainly in the Spanish and Latin American markets.

Amper's ongoing expansion into Latin America recently culminated with the acquisition of 51% in the Brazilian business communications company MLx Medidata. The company says it will be "focusing on those large corporations and medium-sized companies that make use of the enormous possibilities opening up through IP networks."

Amper has been trading on the Nuevo Mercado since the index's inception in April of last year.