Ericsson reports second quarter results 2015
(Thomson Reuters ONE) -
SECOND QUARTER HIGHLIGHTS
* Reported sales increased by 11% YoY. Sales, adjusted for comparable units
and currency, decreased by -6% YoY.
* The mobile broadband business in North America stabilized in the quarter,
but remained at a lower level than a year ago.
* Professional Services continued to deliver strong sales growth YoY.
* Sales in segment Networks recovered and showed a growth QoQ of 18%.
* Gross margin decreased YoY to 33.2% (36.4%). Excluding restructuring
charges, gross margin was 35.1% (36.6%) due to lower capacity business in
North America and continued 4G coverage deployments in Mainland China, lower
IPR revenues and higher share of services sales.
* The global cost and efficiency program is progressing according to plan and
restructuring charges in the quarter were SEK 2.7 (0.2) b., mainly related
to the reductions in Sweden.
* Operating income, excluding restructuring charges, improved in all segments
YoY to SEK 6.3 (4.2) b. and segment Networks operating margin recovered from
last quarter.
* Cash flow from operating activities recovered to SEK 3.1 (2.1) b., after a
weak first quarter.
+------------------------+-----+-----+------+-----+------+----------+----------+
| | Q2| Q2| YoY| Q1| QoQ|Six months|Six months|
| SEK b. | 2015| 2014|change| 2015|change| 2015| 2014|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Net sales | 60.7| 54.8| 11%| 53.5| 13%| 114.2| 102.4|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Sales growth adj. for | | | | | | | |
|comparable units and | | | | | | | |
|currency | -| -| -6%| -| 12%| -6%| -4%|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Gross margin |33.2%|36.4%| -|35.4%| -| 34.2%| 36.4%|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Gross margin excluding| | | | | | | |
|restructuring charges |35.1%|36.6%| -|36.3%| -| 35.7%| 36.6%|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Operating income | 3.6| 4.0| -11%| 2.1| 67%| 5.7| 6.6|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Operating income | | | | | | | |
|excluding restructuring | | | | | | | |
|charges | 6.3| 4.2| 49%| 2.7| 129%| 9.1| 7.0|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Operating margin | 5.9%| 7.3%| -| 4.0%| -| 5.0%| 6.5%|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Operating margin | | | | | | | |
|excluding restructuring | | | | | | | |
|charges |10.4%| 7.7%| -| 5.1%| -| 7.9%| 6.8%|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Net income | 2.1| 2.7| -20%| 1.5| 46%| 3.6| 4.4|
+------------------------+-----+-----+------+-----+------+----------+----------+
| EPS diluted, SEK | 0.64| 0.79| -19%| 0.40| 60%| 1.04| 1.44|
+------------------------+-----+-----+------+-----+------+----------+----------+
| EPS (Non-IFRS), SEK | | | | | | | |
|(1)) | 1.45| 1.07| 36%| 0.77| 88%| 2.22| 1.98|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Cash flow from | | | | | | | |
|operating activities | 3.1| 2.1| 50%| -5.9| -152%| -2.8| 11.5|
+------------------------+-----+-----+------+-----+------+----------+----------+
| Net cash, end of period| 3.5| 32.5| -89%| 15.6| -78%| 3.5| 32.5|
+------------------------+-----+-----+------+-----+------+----------+----------+
|1) EPS, diluted, excl. amortizations and write-downs of acquired intangible |
|assets, and restructuring. |
+------------------------------------------------------------------------------+
Comments from Hans Vestberg, President and CEO of Ericsson (NASDAQ:ERIC)
Reported sales increased by 11%. Sales, adjusted for comparable units and
currency, decreased by -6% YoY, mainly impacted by less capacity business in
North America. Profitability improved sequentially, driven by a strong
development in segment Networks.
Business
The mobile broadband business in North America stabilized in the quarter, but
remained at a lower level than a year ago. The YoY decline in North America was
partly offset by an increased pace of 4G deployments in Mainland China. Sales
growth was strong in the Middle East, India and South East Asia, while it
continued to be weak in Japan. Professional Services sales increased YoY with
continued strong global demand and growth in all ten regions.
The OSS & BSS business had a favorable development YoY, contributing to sales
both in Professional Services and segment Support Solutions.
Segment Networks sales increased by 18% sequentially, supported by the
stabilized mobile broadband sales in North America.
Profitability
Operating income, excluding restructuring charges, increased YoY by almost 50%,
with improvements in all segments. After a weak first quarter, segment Networks
profitability recovered, driven by increased sales and a positive currency hedge
effect.
IPR revenues
Reported IPR revenues were slightly down YoY despite a positive currency effect
as a majority of the licenses contracts are in USD. The decline was primarily
due to the ongoing dispute with a major customer.
Cost and efficiency program
The global cost and efficiency program is progressing according to plan. The
target, to achieve savings of approximately SEK 9 b. during 2017 relative to
2014, remains. During the quarter, numerous activities were implemented globally
including a reduction of 2,100 positions in Sweden, resulting in higher than
normal restructuring charges. Savings related to the activities will start to
impact results towards the end of this year.
Cash flow
After a weak first quarter, cash flow from operating activities was positive in
the quarter. As cash flow is volatile between quarters it should be viewed on a
full-year basis. Our full-year cash conversion target of more than 70% remains.
Targeted growth areas
Our growth strategy builds on a combination of excelling in our core business
and establishing leadership in targeted growth areas. We see good progress in
the targeted areas and sales continued its strong development from the first
quarter. This was mainly driven by a solid sales development in OSS & BSS.
The consolidation in the industry continues, both among vendors and customers,
creating opportunities and challenges. Therefore we have, during the first half
of 2015, accelerated our transformation journey towards becoming a true ICT
company. With our ongoing strategic initiatives we are well positioned to
continue to create value for our customers in a transforming market.
NOTES TO EDITORS
You find the complete report with tables in the attached PDF or by following
this link www.ericsson.com/res/investors/docs/q-reports/2015/06month15-en.pdf or
on www.ericsson.com/investors
Ericsson invites media, investors and analysts to a briefing at the Ericsson
Studio, Grönlandsgången 4, Stockholm, at 09.00 (CET), July 17, 2015.
A conference call for analysts, investors and media will begin at 14.00 (CET).
Live webcast of the briefing and conference call details, 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/press
FOR FURTHER INFORMATION, PLEASE CONTACT
Helena Norrman, Senior Vice President, Marketing and Communications
Phone: +46 10 719 34 72
E-mail: media.relations(at)ericsson.com
Investors
Peter Nyquist, Head of Investor Relations
Phone: +46 10 714 64 49
E-mail: peter.nyquist(at)ericsson.com
Åsa Konnbjer, Director, Investor Relations
Phone: +46 10 713 39 28
E-mail: asa.konnbjer(at)ericsson.com
Stefan Jelvin, Director, Investor Relations
Phone: +46 10 714 20 39
E-mail: stefan.jelvin(at)ericsson.com
Rikard Tunedal, Director, Investor Relations
Phone: +46 10 714 54 00
E-mail: rikard.tunedal(at)ericsson.com
Media
Ola Rembe, Vice President, Head of External Communications
Phone: +46 10 719 97 27
E-mail: media.relations(at)ericsson.com
Corporate Communications
Phone: +46 10 719 69 92
E-mail: media.relations(at)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 July
17, 2015.
Ericsson second quarter report 2015:
http://hugin.info/1061/R/1939509/699831.pdf
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire 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 GlobeNewswire
[HUG#1939509]
Unternehmensinformation / Kurzprofil:
Datum: 17.07.2015 - 07:30 Uhr
Sprache: Deutsch
News-ID 407505
Anzahl Zeichen: 10883
contact information:
Town:
STOCKHOLM
Kategorie:
Business News
Diese Pressemitteilung wurde bisher 170 mal aufgerufen.
Die Pressemitteilung mit dem Titel:
"Ericsson reports second quarter results 2015"
steht unter der journalistisch-redaktionellen Verantwortung von
Ericsson (Nachricht senden)
Beachten Sie bitte die weiteren Informationen zum Haftungsauschluß (gemäß TMG - TeleMedianGesetz) und dem Datenschutz (gemäß der DSGVO).
