Pearse Flynn says ‘This world-class association offers substantial benefits’

KANATA, ONTARIO – 06 Apr 2000: — Newbridge Networks (TSE:NNC.) (NYSE:NN) today announced it has selected IBM Global Services (NYSE: IBM) to extend the Company’s customer reach, accelerate customer satisfaction, and significantly improve worldwide service delivery. Under the agreement Newbridge and IBM will work together to enhance Newbridge’s comprehensive range of services.

The agreement between Newbridge and IBM offers significant competitive advantages for both companies and their customers. IBM provides the technical support expertise to enable Newbridge to offer consistent, convenient, high quality service to more customers in more locations. IBM’s continuous focus on best-of-breed service delivery and industry leading customer satisfaction enables Newbridge to focus on its core business areas, while providing customers with access to IBM’s global portfolio of support services.

“Today’s announcement marries Newbridge’s core strengths in wide area networking solutions with those of IBM Global Services, a global technology leader recognized worldwide for its commitment to high quality service,” said Pearse Flynn, President and COO, Newbridge Networks. “This world-class association offers substantial benefits that will strengthen our business moving forward and will enable our customers to reap the benefits of a wide range of capabilities.”

Newbridge selected IBM because it is the only service provider capable of handling the full scope of the Company’s global operations. IBM also delivers extensive experience in global service provisioning and a field support force that is highly trained in wide area networking (WAN), frame relay and asynchronous transfer mode (ATM) technologies. Together, the two companies will deliver end-to-end technical and support services that include call centres, first level technical support, field service engineering, network installation, and service logistics.

“We are delighted to forge a relationship with Newbridge Networks, a leading solutions vendor who shares our dedication to customer service,” said John Bothwell, Vice President and General Manager, IBM Global Services, Canada. “We will bring to bear IBM’s leadership in the multivendor network service environment, along with our vast resources, breadth of skills and experience worldwide, to advance our businesses and better serve our customers.”

Prior to the agreement, Newbridge conducted a thorough review of its operations in relation to a marketplace that is characterized by healthy economic growth, global competition, mergers and acquisitions, deregulation, and increased demand for e-business applications and next-generation technologies. The Company projects that its growing customer base of leading carriers throughout the world will continue, as will demand for rapid service deployment and consistent service and pricing, irrespective of specific customer location. Newbridge has determined that the optimal way to effectively manage and sustain this growth and continue to offer a high level of customer satisfaction is to work with IBM, a world-class service provider and a global leader in technical support services.

http://www-03.ibm.com/press/us/en/pressrelease/1788.wss

Pearse Flynn replaces Alan Lutz at Newbridge Networks

Newbridge Networks (NYSE: NN) said its president and chief operating officer is resigning, adding a new twist as it reported a familiar story Tuesday. “The quarter was a disappointment,” said Terence Matthews, chairman and chief executive officer.

You don’t often hear that kind of honesty in a press release, but after a record like Newbridge Networks’ it’s hard to pretend.

The company said preliminary estimates for the second quarter put revenue at $480 million, and earnings at 8 to 10 cents a share. First Call was expecting a profit of 20 cents a share.

The Canadian network equipment maker issued profit warnings in five of its past eight fiscal quarters. The company finally did something right in its first quarter, skipping past estimates on strong revenue. This prompted analysts to go wrong by predicting the company’s shares would outperform the broader markets in upcoming months.

Shares closed at 20 3/4 Monday after a rocky descent from highs approaching the 30s in August.

Alan Lutz, the company’s president and chief operating officer, will be replaced by Pearse Flynn, who has spearheaded Newbridge’s operations in Europe over the past year as the general manager for Europe, Middle East and Africa

“The company has fared much better in Europe, raking in revenue almost 40 percent higher than in the second quarter of fiscal 1999, compared to its flat revenue from North America.

Despite the setbacks, the company said it is trying to leverage its “core strengths,” such as WAN (wide area network) packet – switching revenue, which was up 40 percent over last year’s quarter, and strong positions in technologies such as ATM+IP switched routing and broadband wireless.

The company also said it is addressing “issues that require attention, primarily sales effectiveness and ability to scale customer-facing resources.” Further details will be discussed on the November 18th conference call.