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INTERVIEW-Dassault Asia business up 30 pct--CEO

TOKYO, Nov 26 (Reuters) - French software company Dassault Systemes said on Tuesday its Asian business would expand 30 percent in 2002, despite a global technology slowdown.

"The Asian story for us is a very good one. Asia is 30 percent growth this year," Chief Executive Bernard Charles told Reuters on the sidelines of the Paris Europlace Financial Forum.

"It will represent almost 25 percent of our revenues on the full-year basis. For 2003, I expect to see a little bit smaller but still very positive growth."

A slump in corporate spending on technology over the past two years, amid economic uncertainty, has squeezed revenues at information technology firms, and investors had been hoping for a brighter 2003.

Dassault, a leading producer of software for managing product lifecycles and for computer-aided design, boasts Japanese clients such as Sony Corp .

Charles did not specify Japanese expectations, but a report in business daily Nihon Keizai Shimbun earlier this month forecast it would have sales of four billion yen ($32.79 million) in the business year to next March, up 30 percent.

Charles noted a recent agreement with Japan's largest automaker, Toyota Motor Corp , for product software for its Toyota Industries Corp, but said it would not be reflected in Dassault's bottom line for up to three years.

"We do not do the revenue recognition up front. We do it as the product is being installed."

In October, Dassault reported weaker overall third-quarter profits and revenues and predicted a flat 2003 operating margin on sales growth of just two to three percent

Charles said the company's outlook had not changed since reporting earnings and he was looking for full-year growth in the current business year of about four percent.

He said the company's outlook for next year was cautious, although it was gaining overall market share.

"Two to three percent (growth) was a conservative input for 2003."

Shares in Dassault Systemes have weakened from a high of 59.40 euros in March to 28.70 at the end of trade in Paris on Monday.

Charles said he was confident that the company's fundamentals would ultimately be rewarded by the market.

"We have no debt, we have a lot of cash, on the operating margins we have almost been at 30 percent every year," he said.

"The fact that we have strong cash and generate a lot of cashflow is becoming a key parameter. Two years ago investors were not sensitive to that aspect."

($1=122 yen)