Ericsson first quarter report 2012
(Thomson Reuters ONE) -
* Sales decreased -4% YoY, impacted by an expected major decline in CDMA sales
as well as lower operator network spending in regions with macro-economic or
political uncertainty. Global Services and consolidation of Telcordia
contributed positively.
* The underlying business mix, with higher share of coverage and network
modernization projects than capacity projects, was unchanged. This mix is
expected to prevail short-term.
* Operating margin 5.5% excl. gain from Sony Ericsson divestment and loss in
ST-Ericsson.
* Net income SEK 8.8 b. up 116% YoY, impacted by gain from Sony Ericsson
divestment of SEK 7.7 b and loss in ST-Ericsson.
* EPS diluted SEK 2.76 (1.27), driven by gain from Sony Ericsson divestment.
EPS Non-IFRS and excluding Sony Ericsson gain SEK 0.77 (1.61).
-------------------------------------------------------------------------------
Q1 Q1 YoY Q4 QoQ
SEK b. 2012 2011 Change 2011 Change
-------------------------------------------------------------------------------
Net sales 51.0 53.0 -4% 63.7 -20%
-------------------------------------------------------------------------------
Of which Networks 27.3 33.2 -18% 33.3 -18%
-------------------------------------------------------------------------------
Of which Global Services 20.6 17.4 18% 27.0 -24%
-------------------------------------------------------------------------------
Of which Support Solutions 3.0 2.3 33% 3.4 -11%
-------------------------------------------------------------------------------
Gross margin 33.3% 38.5% - 30.2% -
-------------------------------------------------------------------------------
EBITA margin excl JVs and
Sony Ericsson sale 7.7% 14.1% - 8.1% -
Operating income excl JVs and
Sony Ericsson sale 2.8 6.3 -56% 4.1 -32%
Operating margin excl JVs and
Sony Ericsson sale 5.5% 11.9% - 6.4% -
-------------------------------------------------------------------------------
EBITA margin excl JVs 22.8% 14.1% - 8.1% -
-------------------------------------------------------------------------------
Operating income excl JVs 10.5 6.3 67% 4.1 159%
-------------------------------------------------------------------------------
Operating margin excl JVs 20.6% 11.9% - 6.4% -
-------------------------------------------------------------------------------
Of which Networks 6% 17% - 8% -
-------------------------------------------------------------------------------
Of which Global Services 6% 7% - 6% -
-------------------------------------------------------------------------------
Of which Support Solutions -1% -15% - 0% -
-------------------------------------------------------------------------------
Operating income incl JVs 9.1 5.8 56% 2.2 321%
-------------------------------------------------------------------------------
Income after financial items 9.1 5.8 56% 1.8 396%
-------------------------------------------------------------------------------
Net income 8.8 4.1 116% 1.5 490%
-------------------------------------------------------------------------------
EPS diluted, SEK 2.76 1.27 117% 0.36 667%
-------------------------------------------------------------------------------
EPS (Non-IFRS), SEK(1)) 3.14 1.61 95% 0.81 288%
-------------------------------------------------------------------------------
Cash flow from operations 0.7 -2.9 - 5.5 -
-------------------------------------------------------------------------------
Cash conversion, year to date 17% -46% - 79% -
-------------------------------------------------------------------------------
Net cash, end of period 37.1 48.2 -23% 39.5 -6%
-------------------------------------------------------------------------------
(1)) EPS, diluted, excl. amortizations, write-downs of acquired intangible
assets and restructuring.
Q112 includes a gain from the divestment of Sony Ericsson of SEK 7.7 b.
-------------------------------------------------------------------------------
COMMENTS FROM HANS VESTBERG, PRESIDENT AND CEO
"Sales of high-performance mobile broadband developed well in North America,
Japan and Korea, while other regions such as Europe including Russia, parts of
Middle East and India were weaker," says Hans Vestberg, President and CEO of
Ericsson (NASDAQ:ERIC). "CDMA continued its expected decline in the transition
to LTE. Our services business showed continued momentum where especially
Professional Services developed favorably. Support Solutions (former Multimedia)
increased organic sales.
In the quarter, we took important steps in our strategy execution. The announced
acquisition of BelAir adds WiFi capabilities to our hetnet portfolio and by
acquiring Technicolor's Broadcast Services Division we have strengthened our
position in media and broadcasting services, targeting a leadership position in
Europe. With the completed divestment of Sony Ericsson, we have left the
consumer part of the handset business in order to focus on enabling connectivity
for all devices, handsets and beyond. Last year, we gained market share in our
core businesses and continued to build a strong LTE position where we have more
than 60% market share.
Late 2010, we took a strategic decision to increase our market share in Europe
when operators started to modernize their networks and replacing old
infrastructure with new multi-standard radio base stations. This, together with
the business mix with more coverage than capacity projects, has, as expected,
had a negative impact on gross margin YoY and is expected to prevail short-term.
Our joint venture ST-Ericsson has launched a revised strategy and actions to
reduce its break-even point. We remain confident that ST-Ericsson has a
strategic position in the industry to enable the device ecosystem," concludes
Vestberg.
You find the complete report with tables in the attached PDF or by following
this link:
www.ericsson.com/res/investors/docs/q-reports/2012/3month12-en.pdf
EDITOR'S NOTE
Ericsson invites media, investors and analysts to a press conference at the
Ericsson Studio, Grönlandsgången 4, Stockholm, at 09.00 (CET), April 25, 2012.
An analysts, investors and media conference call will begin at 14.00 (CET).
Live webcast of the press conference and conference call as well as supporting
slides will be available at www.ericsson.com/press and
www.ericsson.com/investors
Video material will be published during the day on
www.ericsson.com/broadcast_room
FOR FURTHER INFORMATION, PLEASE CONTACT
Helena Norrman, Senior Vice President, Communications
Phone: +46 10 719 3472
E-mail: investor.relations(at)ericsson.com or media.relations(at)ericsson.com
INVESTORS
Åse Lindskog, Vice President,
Head of Investor and Analyst Relations
Phone: +46 10 719 9725
+46 730 244 872
E-mail: investor.relations(at)ericsson.com
Stefan Jelvin, Director,
Investor Relations
Phone: +46 10 714 2039
E-mail: investor.relations(at)ericsson.com
Åsa Konnbjer, Director,
Investor Relations
Phone: +46 10 713 3928
E-mail: investor.relations(at)ericsson.com
Rikard Tunedal, Director,
Investor Relations
Phone: +46 10 714 5400
E-mail: investor.relations(at)ericsson.com
MEDIA
Ola Rembe, Vice President,
Head of Corporate Public & Media Relations
Phone: +46 10 719 9727
+46 730 244 873
E-mail: media.relations(at)ericsson.com
Corporate Public & Media Relations
Phone: +46 10 719 69 92
E-mail: media.relations(at)ericsson.com
Telefonaktiebolaget LM Ericsson (publ)
Org. number: 556016-0680
Torshamnsgatan 23
SE-164 83 Stockholm
Phone: +46 10 719 0000
www.ericsson.com
Ericsson discloses the information provided herein pursuant to the Securities
Markets Act. The information was submitted for publication at 07.30 CET, on
April 25, 2012.
First quarter report 2012:
http://hugin.info/1061/R/1605711/508638.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#1605711]
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