Arm Holdings 'reaping dividends'

With the tech gloom over, Arm sees improved prospects for the industry this year.

UK microprocessor designer Arm Holdings has reported fourth-quarter results at the top end of City expectations, and sees an "improved outlook" for 2004.

"Careful cost management" has enabled Arm to start paying dividends - it will pay a total of 0.6p per share for 2003.

Arm made a pre-tax profit of £8.9m for the three months to 31 December, up 62% on the same period last year.

Though activity levels have picked up, Arm warned of the continuing impact of the weak dollar on its fortunes.

New products

Investors have been backing Arm's recovery hopes over the last 12 months as shares have outperformed the IT hardware sector by 16%.

High levels of research and development spending have allowed the company to launch a number of new products this year.

"These are already driving license revenue and underpin our confidence for revenue growth during 2004," said chief executive Warren East.

The company also announced the acquisition of US company Triscend Corp, which specialises in core-based microcontrollers, for £7.3m ($13.2m) cash.

Arm said it views the microcontroller market as a "key emerging market".