Sources inform “Globes” that ECI Telecom (Nasdaq: ECIL) LightScape Optical Networks Division has won a large contract from a leading Ukranian communications operator. LightScape will supply $15-25 million worth of XDM systems.
The systems will form the infrastructure for an advanced communications network for data, Internet, and other advanced services. ECI stated in response to the report, "The company does not respond to rumors."
LightScape's business has begun to recover in recent months, and it has reported a number of major projects. One of the largest contracts, announced last month, is in India, under which LightScape will supply $20 million worth of products to Tata Teleservices (BSE:TTML).
During the fourth quarter of 2003, LightScape announced that had won a Ministry of Defense three-year project to supply XDM to the IDF, worth an estimated $40 million; and project in China worth $3-5 million. Two weeks ago, LightScape announced a $4 million contract in Romania.
ECI will begin reporting revenue from these projects in the first quarter of 2004, indicating that LightScape's recovery is expected to continue. The division's revenue totaled $47 million in the third quarter of 2003, 19% more than the $39.6 million reported in the second, but less than the $57.5 million reported in the third quarter of 2002.
ECI's second division, Inovia Broadband Access Division, which develops equipment for high-speed Internet access over existing telephony network infrastructure, is also expected to report improved results. Inovia recently announced a strategic cooperation agreement with Nortel Networks (NYSE; TSX:NT) to supply network broadband access solutions. Nortel, which abandoned this sector two years ago, will offer Inovia products to its customers. The market potential is considerable, especially in the US.
Published by Globes [online] - www.globes.co.il - on January 28, 2004