From the turrets of its 16th century castle in Scotland, a small computer software company based in Seattle, Wash., is storming Europe.

Craigcrook Castle, located on a verdant hillside near Edinburgh, serves as European headquarters for Aldus Corp., a four-year-old company that already has established itself as Europe's leading producer of desk-top publishing software.According to Intelligent Electronics-Dataquest, a Dun & Bradstreet subsidiary, Aldus already controls roughly half of the lucrative British, French and German markets for desk-top publishing software.

Combined with U.S. and Asian sales, revenue from European sales makes PageMaker the world's fourth largest-selling retail software product.

Aldus predicts it will double its sales in Asia after it releases a Japanese-language version of its PageMaker program this summer.

Aldus is named for Aldus Manutius, a 15th century Venetian who invented italic type and founded the first modern publishing house. Today's Aldus makes possible the latest generation of publishing: a program called PageMaker, which enables personal computers to blend text, type and illustrations into a professional looking page.

Earnings Expected to Rise

International sales last year accounted for about a third of total Aldus Corp. sales of $39.5 million. Overall net income from international and domestic sales ran $7.2 million, more than triple Aldus profits in 1986.

Teresa Lotzgesell, a securities analyst for the Seattle brokerage Cable Howse, predicted earnings for all 1988 will run $1 to $1.05 a share. Earnings for the quarter ending March 31 should be in the range of 19 cents to 23 cents a share, up from 15 cents a share last year, and we're leaning toward the high end of that range.

Bruce Lupatkin, senior technology analyst for Hambrecht & Quist, a brokerage and venture capital firm based in San Francisco, predicted that Aldus' earnings in 1988 would work out to $1 or $1.02 a share. For the first quarter, he forecast earnings of 22 cents a share on $13 million in revenue.

Aldus officials now have their sights set on conquering the ROW. Oh, yes - ROW means rest of the world, said Sarah Rawson at Aldus' European marketing center in London.

An Unlikely Home Base

The heart of Aldus lies not in the Scottish hills, nor in the bustle of Tokyo. Aldus headquarters sits in a weathered brick building along what was once a skid road for logs dragged through the mud to Seattle's earliest sawmill.

Visitors looking for Aldus wend their way through an art gallery, past an Italian restaurant and on to an entrance guarded by a life-size soft sculpture of Bullwinkle J. Moose wearing a Scottish plaid cap.

Bullwinkle, television's favorite moose, was the code name for an advanced version of PageMaker, details of which were sought by the computer trade press with all the determination of Boris and Natasha.

3-Point Foreign Sales Plan

At Aldus headquarters, International Sales Director John O'Halloran explained how Aldus is expanding its overseas sales using the same ideas that generated last year's $13 million in international sales.

He ticked off key points for an exporter of software:

* Don't wait for the domestic sales to peak before starting international sales. Sell both to domestic and overseas markets at the same time.

It helps to have a chairman like Paul Brainerd who believes in the international market and is willing to commit the resources, Mr. O'Halloran said.

* Customize the product for each market. A system that displays text left- to-right may be fine in English-speaking countries, but isn't much help for vertical columns of Japanese characters or for right-to-left languages. And literal translation can be deadly.

The phrase 'screen full' in English can translate as 'you're pregnant' in German, Mr. O'Halloran said. You have to be really careful.

* Recognize cultural distinctions. The biggest obstacles to international sales are cultural. When you're dealing with communication, that's integral to a country's culture, the sales director said.

Hiring a translator to convert an American program into international English may be warranted, or establishing offices at a local castle.

Mr. O'Halloran said PageMaker's international sales are strongest in countries with large numbers of graphics-oriented Apple computers and widespread literacy in English. The company's leading international markets today are the United Kingdom, West Germany and France, in that order.

In the next five years, however, Aldus expects its customized, translated versions of PageMaker to spread throughout countries that use IBM-compatible machines and operate in foreign languages. Mr. O'Halloran predicts that the largest international market will be in Germany, followed by the United Kingdom and Japan.

We have in the works a kanji (Japanese characters) product that we believe is really going to take the lion's share of the Japanese desk-top publishing market, he said.

PageMaker was created first for Apple Inc. computers because the Apple machines had video screens that could produce the graphic elements needed to

put together a printed page via computer.

IBM-style machines, which use a different operating system and thus cannot run Apple-based software, only recently have begun marketing computers with screens that could handle a program like PageMaker.

More Players in the Game

Aldus still has the early market-share advantage, but other desk-top publishing systems are making inroads into the European market.

The same Intelligent Electronics-Dataquest study that estimated that Aldus has half the British, German and French markets, for example, found that the Xerox Corp.'s PC-based Ventura publishing system had captured a 25.2 percent market share in Germany, a 13.1 percent share in France and a 12.6 percent share in the United Kingdom.

Other desk-top publishing systems - Letraset, Quark X-Press, Ragtime and a number of others - all have smaller chunks of the market, but the additional competition could make Aldus expansion more difficult in the future.

Yet Mr. O'Halloran said that Aldus expects international sales to take on a growing importance to the company in the next few years.

Right now, we're a little below 70 percent domestic and a little above 30 percent international, he said. We're looking forward to seeing that swing to 60 percent domestic and 40 percent international.

To date, Aldus sales in Asia have been fairly small, concentrating mostly on Australia and New Zealand, Mr. O'Halloran said.

Opening of the Japanese market and other Pacific Rim countries will help to even that out, he said.




Top Officers:

Paul Brainerd, President

J.M. Thorton,

M.D. Solomon,

Vice Presidents

Jeremy Jaech,

Vice President and



Approximately 200

Production Facilities:

In Seattle

How Traded:

OTC Market

3/21 close $19

1987 Income:

Net Income:

$1.666 million

Earnings a Share:

15 cents


$8.22 million


Aldus Corp. was founded in February 1984. Its first and most important product is PageMaker, a computer program that enables people to design, lay out and produce high-quality printed work. It is branching out, with other software that also serves the burgeoning desk-top publishing industry.