net profits fall by over 20 percent according to its latest interim six-month results.

For the period ending September 30, 1999, the company's net income fell from $7.14 million to $5.71 million.

The company's revenue, however, went up by nearly five percent, from $40.7 million in the same period last year to $42.75 million in the six months in 1999.

In a statement addressed to shareholders and released to the Bermuda Stock Exchange KeyTech Chairman, James King said: "These results reflect the impact of the July 1 reduction in international access charges along with the increase in local access charges.'' Expenses during the six month period also went up by nearly 11 percent from $33.5 million to $37.1 million.

Operating income, however, fell 23 percent from $7.2 million to $5.5 million.

Shareholders' Equity rose from $78 million to $84.4 million, a jump of over eight percent.

The total liabilities and shareholders' equity rose marginally from $134.1 million to $134.4 million.

Earnings per common share fell from $3.51 to $2.91.

Dr. King said: "There continues to be a strong demand for connectivity and we are responding by aggressively investing in upgrading our network. This up-grade will not only increase capacity, but will also enhance capability.

"We continue to struggle with regulatory compliance issues in our Logic subsidiary. The capabilities of modern technology have outstripped the historic boundaries, which shaped our current regulatory framework.

"The Internet provides the capability for the exchange of data in a global arena. This digital technology no longer differentiates between voice traffic and data, and thus clearly identifies why change must occur as this will be further challenged with the availability of satellite communication via hand-held devices.'' He added that the two major shareholders in Bermuda CableVision -- KeyTech and the MacDonald's Group -- had reached a settlement, so allowing the company an opportunity for further growth and development.

KeyTech profits Dr. King added: "The overall prospects of the company are good. Our revenues continue to grow and whilst expenses are up in the near term as a result of our accelerated investment in the network, this will assist towards our goal of becoming a strong and efficient provider of communications services in the new millennium.''