ST-Ericsson reports first quarter 2012 financial results
(Thomson Reuters ONE) -
* Net sales $290 million
* NovaThor U8500 ModAp hitting the market in devices from leading customers
* New strategic direction and partnership announced today
Geneva, Switzerland, April 23, 2012 - ST-Ericsson, a joint venture of
STMicroelectronics (NYSE:STM) and Ericsson (NASDAQ:ERIC), reported financial
results for the first fiscal quarter ending March 31, 2012.
Sales in the first quarter, excluding the contribution of IP licensing to a
third party in the prior quarter, decreased sequentially 27% as anticipated. The
operating loss was higher than the previous quarter due to the lower revenues.
Didier Lamouche, President and CEO of ST-Ericsson said: "This was a two-fold
quarter: on one hand, our sales decreased substantially, as we had anticipated,
due to a drop in sales of new products at one of our largest customers, in
addition to the usual seasonal effect and to the continued decline of our legacy
products.
On the other hand, it was a quarter that marked a milestone, since our
NovaThor(TM) U8500 ModAp systems to Samsung and Sony Mobile Communications
started successfully to ramp, with smartphones from both customers now hitting
the market. In January I said that our focus would be to effectively execute on
our strategic programs, deliver in volume our leading products and to
proliferate design wins. This is now starting to happen and, moving forward, we
will continue to focus on the execution of the four main pillars of our
strategic plan that we announced earlier today."
2012 first quarter financial summary (unaudited)
$ million Q1 2012 Q4 2011 Q1 2011
Income Statement
NET SALES 290 409 444
OPERATING INCOME/(LOSS) ADJUSTED[1] for: (297) (207) (149)
- amortization of acquisition-related intangibles (19) (25) (25)
- restructuring charges (10) (9) (4)
OPERATING INCOME / (LOSS) as reported (326) (241) (178)
NET INCOME / (LOSS) (312) (231) (178)
$ million Q1 2012 Q4 2011 Q1 2011
Additional financial data
Net financial position
Cash, cash equivalents & short-term deposits 22 9 39
Short-term debt (978) (807) (234)
Net financial position[2] (956) (798) (195)
Net operating cash flow[3] (158) (204) (113)
Additional financial information
The net financial positionat the end of the first quarter was negative $956
million. Despite the reported loss, net operating cash flow after capital
expenditure has sequentially improved thanks to the inventory reduction and
working capital management.
Inventory decreased by $14 million reaching $209 million at the end of the first
quarter.
Outlook
For the second quarter 2012, ST-Ericsson expects net sales to increase
sequentially in a low double-digit range.
Highlights - products, technology and wins announced in first quarter 2012
* Products
* Announced at Mobile World Congress, the NovaThor(TM) L8540 is an
LTE/HSPA+/TD-HSPA-enabled integrated smartphone platform with the
powerful application processor and modem integrated on a single die, and
is scheduled to sample to customers in the second half 2012.
* Unveiled the CG2905, the industry's first connectivity platform solution
with simultaneous support for GPS and GLONASS technology, Bluetooth and
FM Radio all integrated on a single 40nm device.
* Introduced first fully integrated wireless charger for mobile phones
with the PM2020.
* Customers
* Samsung is now a customer of the ST-Ericsson NovaThor(TM) platform. The
new Samsung GALAXY S Advance Android-powered smartphone uses the ST-
Ericsson NovaThor(TM) U8500 System.
* Xperia(TM) P, Xperia(TM) U, and Xperia(TM) sola are the first three
smartphones by Sony Mobile Communications to use the NovaThor U8500
ModAp system, combining application processing, modem and connectivity.
* Thor(TM) M5780 HSPA+ modem powers the next-generation Panasonic Eluga
smartphone.
* Ontim WP8500 tablet to be the first commercially available Android-based
tablet using the NovaThor U8500 System.
* Partners/technology
* Selected fully depleted silicon on insulator (FD-SOI) technology for use
in future mobile platforms, leveraging ST technology based on Soitec
SOI, which will enable enhanced performance from the ST-Ericsson
NovaThor(TM) platform at much lower battery usage - as much as 35
percent lower power consumption at maximum performance.
* Continued cooperation with metaio, reaching another milestone in
supporting metaio's new 3D object tracking technology.
* Joined the W3C Core Mobile Web Platform Community Group kicked off by
Facebook.
* SRS Labs made their TruMedia audio processing technology available on
the ST-Ericsson Snowball development platform.
Footnotes
[1] The adjusted operating income/(loss) is defined as the operating
income/(loss) reported before amortization of acquisition-related intangibles
and restructuring charges and is used by management to help enhance the
understanding of ongoing operations and to communicate the impact of the items
on the operating loss as reported.
[2] Net financial position represents the balance between financial assets,
which comprise cash, cash equivalents and short-term deposits, and financial
debt which includes bank overdrafts and parent companies short-term bridge
credit facilities
[3] Net operating cash flow is defined as net cash from operating activities,
less capital expenditure and less restructuring charges.
About ST-Ericsson
ST-Ericsson is a world leader in developing and delivering a complete portfolio
of innovative mobile platforms and cutting-edge wireless semiconductor solutions
across the broad spectrum of mobile technologies. The company is a leading
supplier to the top handset manufacturers and generated sales of $1.7 billion in
2011. ST-Ericsson was established as a 50/50 joint venture by STMicroelectronics
(NYSE:STM) and Ericsson (NASDAQ:ERIC) in February 2009, with headquarters in
Geneva, Switzerland.
www.stericsson.com
www.twitter.com/STEricssonForum
FOR FURTHER INFORMATION, PLEASE CONTACT:
Global Communications & Media Investor & Analyst Relations
Relations Fabrizio Rossini, Geneva, Switzerland
Claudia Levo, Geneva, Switzerland Phone: +41 22 929 6973
Email: investor.relations(at)stericsson.com
Pamela McCracken, Santa Clara, U.S.A.
Phone: +1 408 398 8565
Email: media.relations(at)stericsson.com
Ericsson Investor Relations STMicroelectronics Investor Relations
Asa Konnbjer, Stockholm, Sweden Tait Sorensen, Phoenix AZ, US
Phone: +46 10 713 3928 Phone: +1 602 485 2064
E-mail: Celine Berthier, Geneva, Switzerland
investor.relations(at)ericsson.com Phone: +41 22 929 5812
Email: investors(at)st.com
###
The ST-Ericsson results reported in this press release do not reflect in their
entirety the results of the Wireless Segment of STMicroelectronics, which
include other activities that are not part of ST-Ericsson.
###
This press release contains forward-looking statements that involve inherent
risks and uncertainties. We have identified certain important factors that may
cause actual results to differ materially from those contained in such forward-
looking statements. For a detailed description of risk factors see
STMicroelectronics' (NYSE:STM) and Ericsson's (NASDAQ:ERIC) filings with the US
Securities and Exchange Commission, particularly each company's latest published
Annual Report on Form 20-F.
First Quarter 2012 financial results:
http://hugin.info/1061/R/1605215/508268.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Ericsson via Thomson Reuters ONE
[HUG#1605215]
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