Compaq, the second-largest computer company in the world, has announced fourth-quarter revenues and earnings ahead of analysts' expectations. The company, which employs more than 2,200 people in Ireland, posted profits for the period of $758 million, a 13.6 per cent increase on the same period last year.

For the full year, however, Compaq reported a loss of $2.743 billion (#2.39 billion) following its June acquisition of Digital Equipment for $8.4 billion. The company said the bulk of its merger-associated adjustments were successfully behind it, and it was about to embark on a new aggressive strategy.

"The fourth-quarter revenue and earnings results represent new records for Compaq and a key milestone in our successful integration of Digital Equipment Corporation," said Mr Eckhard Pfeiffer, president and chief executive officer of Compaq.

Profits per share for the quarter were 43 cents, slightly higher than the 37 cents analysts had expected. Sales for the period totalled $10.9 billion (#9.49 billion), reflecting a 48 per cent increase on the corresponding period last year.

Mr Tom Keating, general manager of Compaq Ireland, said the integration with Digital had gone very well here. "Digital's Irish customer base was one of the strongest and oldest in its portfolio. We are now the largest computer company servicing the Irish market, and in particular we have performed strongly in the consumer market."

Ireland has been identified by Compaq as a crucial centre for its expansion in Europe. It currently employs more than 1,000 people at its European call centre in Clonskeagh, Dublin, while its software development site in Galway is recognised as a centre for excellence in Europe.

Mr Keating believes Ireland could feature strongly in Compaq's development plans, though he says it is still too early to say, pending a meeting with senior Compaq staff next month.

Compaq's future strategy will now focus on three key areas. Its existing core business remains the manufacture and sale of computers. A newer market, which has been facilitated by the acquisition of Digital, services the needs of large enterprises with more complex computer system requirements.

And a new Internet focus has emerged following the establishment this week of the newly formed AltaVista Company.

It is generally reckoned that the AltaVista search and navigation site for Internet users is to become a key destination for Internet information and electronic commerce.