http://www.the-times.co.uk/news/pages/tim/99/11/11/timbizbiz02041.html?999 Doulton bitten by millennium bug BY FRASER NELSON ROYAL DOULTON, one of Britain's oldest and most fam-ous makers of china, yesterday admitted that the millennium bug had already cost it up to £12 million in lost orders. Although its new £5 million computer system recognised dates ending in 00, it did not recognise many best-selling Royal Doulton wares - and automatically rejected orders from all around the world. The company believes it has lost orders worth between £10 million and £12 million because frustrated customers took their business elsewhere. Its shares crashed 25 per cent yesterday, closing at 78½p, and the confession prompted analysts to forecast a £25 million full-year loss for Royal Doulton - more than double the £12 million loss expected earlier. The stock dived 23½p to 79½p as a result. Hamish Grossart, the merchant banker who has been running the company for the past year, said there had been a series of basic errors that should have been spotted by his team. "In the US, our best-selling package is a five-piece place setting. But the system did not recognise a set. So when the order came in - say 200 sets to a department store - the computer would say 'none in stock'. It should have picked five pieces and made the sets." As a result, production levels were nearly halved - from 450,000 shipments a week to about 250,000 a week. Royal Doulton has been trumpeting the millennium as a great sales opportunity for expensive commemorative ceramics but has been unable to produce a full range. --- see also http://biz.yahoo.com/apf/991111/royal_doul_1.html Thursday November 11, 12:33 am Eastern Time Computer Glitch Costs Royal Doulton By BRUCE STANLEY AP Business Writer LONDON (AP) -- With more than 200 years of experience behind it, fine china manufacturer Royal Doulton thought it was being prudent when it installed a new computer system to guard against the Y2K bug. But the cure for the potential illness took a painful toll of its own. The company said Wednesday that it will lose an estimated $19 million in sales because the new equipment caused delays of up to 10 weeks in deliveries of its goods to distributors. The problem comes as Royal Doulton, which has been manufacturing fine china since 1748, approaches its most important period for sales: the weeks before Christmas. Investors reacted to the announcement by dumping the stock, which plunged 23 percent to finish trading at 79.5 pence ($1.27) per share. The new system was installed to avoid potential problems when the Year 2000 arrives. Many older computers and software programs recognize only the last two digits of the year and could mistakenly interpret ``00'' as 1900. The glitch apparently arose because of problems integrating the new equipment with the company's existing computers. As a result, the china maker was unable to supply distributors when they ran out of inventory. Spokeswoman Valerie Baynton said Royal Doulton has now solved the problem, but it has already cost the company. The expected loss is equal to 5 percent of Royal Doulton's sales for all of 1998. ``It's very frustrating,'' Baynton said from the company's headquarters in Stoke-on-Trent, 200 miles north of London. The company's profit warning is its latest setback in recent months. Interim sales so far this year, $144.5 million as of the end of June, are already well below their 1998 level of $173.6 million. Chairman Hamish Grossart said operating losses for the year would exceed analysts' forecasts of $16 million. Sales of Royal Doulton's traditional tableware have suffered from a decline in formal dining and the rise of convenience foods and TV dinners. Tougher competition from Waterford Wedgwood PLC [NasdaqNM:WATFZ - news] and other china makers have hampered business, as has the company's decision to discontinue shipments to discount retailers. In response to depressed sales, Royal Doulton announced last December that it was laying off 1,200 workers, almost a fifth of its work force. --