11 June 1998: Although the current imbalance between supply and demand for optical fibre is causing temporary problems for fibre producers, the growth in worldwide fibre and cable markets over the nex…
11 June 1998: Although the current imbalance between supply and demand for optical fibre is causing temporary problems for fibre producers, the growth in worldwide fibre and cable markets over the next five years is projected at a compound annual rate of 15%, Ray Jaeger, chairman of US firm SpecTran Corporation, told the annual meeting of shareholders held at the end of May. “That growth will be driven by continued demand for increasing bandwidth, everything from voice communications, to computing, data networking and video distribution,” Jaeger said. Although Spectran“s earnings, as was announced earlier this year, are likely to decline in 1998, Jaeger said he believed that the outlook was very bright and that the company“s long-term financial goals of achieving a pre-tax return on revenues of 15%, net income return of 9% and a return on equity of 15% were still achievable. Jaeger explained that in order to compete effectively on world markets, the company must continue to invest heavily in product, process and market development as well as improve manufacturing efficiencies. Without development spending on a new low-cost, single-mode fibre process, totalling over US$ 6 million this year, he said that income growth in 1998 would be similar to 1997. Charles Harrison, president and chief executive officer, outlined a number of initiatives the company was taking in order to accelerate progress toward its long-term goals. These include an increase in manufacturing capacities and efficiencies at Communication Fiber Technologies and Specialty Optics. The expansion at Communication Fiber Technologies, when fully operational, is expected to give added capacity to increase revenues while reducing unit costs. At the meeting, shareholders re-elected three directors for three-year terms. Terms of the five remaining directors did not expire this year. In addition, shareholders approved an amendment to the company“s Incentive Stock Option Plan, increasing the number of shares reserved for issuance by 325,000, and ratified the selection of KPMG Peat Marwick as independent certified public accountants for 1998.