Zeneca blames millennium bug for fall in profits

Pharmeceuticals and agrochemicals group, Zeneca, has partly blamed the cost of its millennium compliance programme for a downturn in profits.

The company reported half-yearly profits down two per cent on the same period last year, saying the strength of sterling and a £20m bill for its Year 2000 fix were the primary causes.

It hopes to have solved its millennium systems issues by the end of the year, but costs could total £45m.

A spokesman for Zeneca said: "1,700 out of 2,000 systems are now compliant - our goal is to have [the bug] fixed by the end of the year. We are satisfied with the progress so far."

He added that the company is already in discussion with its trading partners and will concentrate more on this once it had fixed its in-house systems.

Profits for the six months ending 30 June 1998 were £654m, on sales of £2.9bn against £2.75bn for the same period last year. Zeneca said the strength of sterling cost the group £81m for the period.