Mergers and expansions have been providing a lot of work to the business of names. Unisite, formerly Glides, is very happy. It would have been too much to have Uniscape and Unisite in the same "space." Now Unisite has the uni- prefix all to itself - for the time being. Okay, there is Unicode, but that's not a company. And Telelingua from Belgium is happy since it is coming into the US market headed by industry veteran Lionel Mellet. Earlier, Translingua became part of RWS and although it is RWS Translingua for the time being, it is inevitable that the Belgium firm will soon have the suffix -lingua for itself, given the proclivities of branding.

Then there was the deal that wasn't…

The deal that wasn't was the purchase of Berlitz GlobalNET by Bowne. There are several versions of what happened. Version One goes something like this: Bowne was interested in talking to Berlitz, because in a previous corporate meeting a Bowne consultant suggested that corporate America was only truly interested in globalization firm that had US $250 million in annual sales. With the purchase of Berlitz Bowne would almost be there. The Japanese owner of Berlitz GlobalNET bought Berlitz primarily for the language-learning business; he never had much interest in localization, and made some entreaties to Bowne to sell the company. But a groundswell of opposition within Berlitz GlobalNET about being sold, and the manner in which it was attempted, scuttled the deal. For now. So Berlitz GlobalNET lives to fight another day.

Since it became part of the Japanese printing conglomerate we have not heard how Berlitz GlobalNet has been doing. But Berlitz GlobalNet did report that its online translation service (one which Berlitz has downplayed) increased its revenues in 2001 by 300% to € 1.5 million. Despite being in operation only a few years, Berlitz Globalnet has translated over 10 million words and generated over € 3 million in sales since 1999.

Bowne (BNE) goes on as well and becomes more corporate in orientation. Robert Johnson, Bowne's CEO, announced at Bowne's May 30th annual meeting that Bowne Global Solutions, "will continue to invest… but before that happens we want to clearly distance BGS from the fragmented competition in terms of global reach and capabilities, breadth of service offerings, quality and profitability." Johnson forgot to mention that BGS is clearly distancing itself from anyone else in job titles. They just hired someone with the title "Director of Strategic Development and Testing." If that wasn't bad enough, he reports to "VP Productivity Applications and New Business Program Management." But these titles actually appeal to, and are in harmony with, multinational corporate management - a major hi-tech firm in Boston calls its head of localization "Director of Human Factors Localization."

So in lieu of all this corporatization, how is BGS doing? First quarter 2002 sales are up to US $28 million compared to US $19 million the year before. But the first quarter showed a US $83,000 loss compared to a profit of US $1 million the year before. Sales in 2001 were US $101 million with an EBITDA of US $6.1 million. This now represents 10% of Bowne's sales, and BGS reported gross margins of 36% throughout this period.The financial chat lines, however, have been vicious in how Bowne, the corporate parent, has been managed of late.

For the first time in as long as I have been writing this column, the Yahoo financial chat boards have had nothing bad to say about LioNBRIDGE (LIOX). "Bashers should feel well out of place" went one headline. LioNBRIDGE did release one of the most beautiful 2001 annual reports, complete with art deco illustrations, but from what I understand it was recalled due to a financial typo. Notwithstanding the typo, 2001 revenues were US $101 million but with a loss of US $24 million. LioNBRIDGE did state that it still had US $11 million at the end of 2001, and it has been hiring new sales people. For the quarter ending in June, LioNBRIDGE estimates sales of US $28 million for the quarter and earnings of US $1 million. While Bowne states it hasn't yet reached the scale it needs to, LioNBRIDGE's Cowan "firmly believes that we have achieved the scale and customer quality metrics necessary to succeed…" Bloomberg.com has reported favorably on Lionbridge and its stock is up to US $2.50. More importantly, LioNBRIDGE announced that it had renewed key finance agreements with Capital Resource Partners and Silicon Valley Bank.

SDL International also showed a loss for 2001. This was in the order of £ 1.4 million compared to a profit of £ 2.4 million the year before. Its share price has been around 50 pence.

Across the English Channel Systran Systems reported its results for the first quarter 2002 which showed a decline of sales from € 2.5 million to € 1.5 million. Its share price has fluctuated at around € 1.2 which is down from a 52 week high of € 5.

And after an absence of several years Siemens AG is back in the translation business. It has been doing in-house translations, but in 2001 did € 3 million on external jobs with a turnover of € 10 million. In addition, Siemens subsidiaries in the UK, Belgium and the Netherlands set up private translation bureaus as well. Yes, you've got it right - there are four separate entities under the Siemens name selling translation and localization services.

That's it for the publicly traded fragments of the translation and localization business. We now turn to an interesting phenomena where private companies have been giving at least the illusion of reporting their financial results. VistaTec started it last year when they announced a profit of £750,000 on a turnover of £6 million for 2000 and estimated that 2001 would see a profit of £1 million on a turnover of £11 million.

Welocalize announced "revenue up 153% and earnings up 102% in the first quarter" but gave no actual figures as it had done previously. More perplexing were the announcements of Rubric and Idiom. Rubric used financial language in announcing progress but gave no numbers or percentages, just "Rubric excels in Strategy Markets in first half of fiscal year 2002." The press release even went on to say that Rubric's fiscal year "began on December 1, 2001 and the first half ended on May 31, 2002." Idiom then used financial language to say that it, "finished its first quarter with increased sales and market momentum," and, "during the quarter, Idiom reorganized and expanded its sales and marketing organization to better position the company for growth in 2002." My point is if you are going to use financial type language in reporting, what you then do is give us some numbers.

The Logos Group in Modena Italy did give us some "numbers" which would make you want to set up shop in Italy. In announcing its financial statements for the year 2000 it reported sale of € 29 million in 2000 up from € 12 million the year before but more interesting its net worth increased from € 4 million to over € 24 million in the period of a year. It didn't indicate whether these numbers were audited.

Telelingua, whom I mentioned earlier, did announce 2001 sales of US $7 million as it moves into the fragmented US market. Lionel Mellet notes, "I am convinced that the market is more and more looking to get back to the human touch of the SME, and the competitive pricing that can only be obtained from companies with a lightness of infrastructure that the SME model provides."

John Freivalds (JFA@worldnet.att.net) is a long-time contributor to the LISA Newsletter and market analyst. His "Money Talks" column has regularly appeared in the LISA Newsletter for more than four years. He is currently with JFA International.