ERICSSON REPORTS THIRD QUARTER RESULTS
(Thomson Reuters ONE) - * Sales SEK 46.4 (49.2) b, down 4% for comparable units, down 12% currency adjusted* Operating income 1) before JVs SEK 5.5 (5.6) b* Operating margin 1) before JVs 11.7% (11.5%)* Share in earnings from JVs 1) SEK -1.5 (0.0) b* Income after financial items 1) SEK 4.0 (6.2) b* Restructuring charges of SEK 2.7 (1.9) b, excl JV* Net income SEK 0.8 (2.9) b* Earnings per share SEK 0.25 (0.89)* Cash flow 2) SEK 6.9 (2.7) b1) Excluding restructuring charges2) Excluding cash outlays for restructuring of SEK 1.2 (0.3) b anddividend from Sony Ericsson of SEK 1.4 b in Q3 2008CEO COMMENTS"Sales of network equipment declined due to lower demand in thecurrent tougher market environment. Despite lower volumes, Networkmargins remain stable. The strong development in ProfessionalServices continued," saysCarl-Henric Svanberg, President and CEO of Ericsson (NASDAQ:ERIC)."Our cost reduction activities are running ahead of plan with furtheropportunities for efficiency improvements and savings.As commented on in previous reports, the economic climate affects theglobal mobile infrastructure market and the credit environment isstill tight in several emerging markets. However, other markets,including the world's leading economies such as China, India, US andJapan show good development.The technology shift from voice telephony to mobile broadband isongoing. Mobile broadband users and traffic are increasing rapidlyand will eventually connect billions of people to internet. With theshift follows the anticipated decline in GSM sales, accelerated bythe current recession, which is not yet offset by the growth inmobile broadband.Our services operation continues to show strong development. Whilemanaged services are often in focus, systems integration andconsulting are increasingly important. Services margins are stabledespite being negatively affected by the start up costs in the thirdquarter for the Sprint and Zain services contracts as well as thereduced scope and transformation costs for the renewed managedservices agreement in Italy.In late September, we were pleased to welcome the former Sprintemployees into Ericsson, and we look forward to soon also welcomeformer Nortel employees. This, together with the major contract winswith Verizon, AT&T and Metro PCS in mobile and fixed broadband, makesEricsson the leading provider of telecommunications technology andservices in North America.While the current economic environment affects all parts of societythe longer-term fundamentals for our industry remain solid. Mobiletelephony is reaching a penetration beyond all expectations. Weexpect mobile broadband to show a similar exciting development overthe years to come, not least as the vast majority of the world'spopulation will be able to reach internet only through mobiletechnology. We are well positioned to lead our industry forward,"concludes Carl-Henric Svanberg.FINANCIAL HIGHLIGHTSINCOME STATEMENT AND CASH FLOW Third quarter Second quarter Nine monthsSEK b. 2009 2008 Change 2009 Change 2009 2008 ChangeNet sales 46.4 49.2 -6% 52.1 -11% 148.1 141.9 4%Net sales forcomparable units 46.4 48.2 -4% 52.1 -11% 148.1 137.8 7%Gross margin 36.2% 37.0% - 36.3% - 36.3% 37.5% -EBITDA marginexcl JVs 15.8% 15.4% - 16.8% - 15.3% 14.3% -Operating incomeexcl JVs 5.5 5.6 -3% 6.9 -21% 17.1 13.7 25%Operating marginexcl JVs 11.7% 11.5% - 13.3% - 11.5% 9.6% -Income afterfinancial items 4.0 6.2 -35% 4.8 -18% 12.2 15.3 -21%Net income 0.8 2.9 -74% 0.8 0% 3.4 7.6 -55%EPS diluted, SEK 0.25 0.89 -72% 0.26 -4% 1.05 2.31 -55%Adjusted cashflow 1) 6.9 2.7 - 9.9 - 15.1 14.2 -Cash flowfrom operations 5.7 3.8 - 9.1 - 12.0 17.0 -All numbers, excl. EPS, Net income and Cash flow from operationsexcl. restructuring charges.1) Cash flow from operations excl. restructuring cash outlays. Ninemonths cash outlays of SEK 3.2 (0.8) b and dividends from SonyEricsson of SEK 0.0 (3.6) bSales in the quarter decreased 4% year-over-year for comparableunits, i.e. excluding Ericsson Mobile Platforms, and decreased 12%adjusted for currency exchange rate effects and hedging. The thirdquarter last year was comparatively strong with no normalseasonality.Sequential sales decreased 11%, negatively impacted by currencyexchange rate effects, seasonality and a reduced scope of the renewedmanaged services agreement in Italy. The lower year-over-year salesin Networks and Multimedia were partly offset by stronger sales inProfessional Services.The gross margin, was flat sequentially despite the lower sales, anddecreased only slightly year-over-year to 36.2% (37.0%). Theyear-over-year change is largely attributable to the sales mix, witha higher proportion of network rollout and professional services,efficiency gains and some currency exchange rate effects.Operating expenses amounted to SEK 11.6 (12.9) b. in the quarter,excluding restructuring charges. The year-over-year reduction isprimarily a result of ongoing cost reduction activities, offsettingnegative impact from currency exchange rate effects.Operating income excluding joint ventures and restructuring chargesamountedto SEK 5.5 (5.6) b. in the quarter, resulting in a slightly improvedoperating margin of 11.7% (11.5%). The margin was stable sequentiallywhen adjusted for a capital gain of SEK 0.8 b. in the second quarter2009.Ericsson's share in earnings from joint ventures amounted toSEK -1.5 (0.0) b. in the quarter, excluding restructuring charges.This is a significant reduction from the second quarter as a resultof the ongoing efficiency improvements. Restructuring charges injoint ventures were insignificant in the quarter.Financial net was SEK 0.0 (0.5) b. in the quarter, due to lowerinterest net.Net income amounted to SEK 0.8 (2.9) b. in the quarter.Adjusted cash flow amounted to SEK 6.9 (2.7) b. in the quarter, downsequentially from SEK 9.9 b., excluding cash outlays forrestructuring of SEK 1.2 b. Year-to-date cash conversion rate was 87%(102%). Trade receivables was positively impacted by currencyexchange rate effects and lower sales. While days sales outstanding(DSO) improved slightly sequentially to 118 (121) days, the creditenvironment is however still tough for second and third tieroperators in emerging markets.Inventory was reduced by SEK 2.2 b. in the quarter to SEK 26.8 b. andturnover was stable at 77 (78) days.BALANCE SHEET AND OTHER PERFORMANCE INDICATORS Sep 30 June 30 Mar 31 Dec 31SEK b. 2009 2009 2009 2008Net cash 33.9 27.9 22.9 34.7Interest-bearing liabilitiesand post-employment benefits 45.9 47.6 41.2 40.4Trade receivables 62.4 69.4 75.2 75.9 Days sales outstanding 118 121 124 106Inventory 26.8 29.0 30.7 27.8 Of which market 15.9unit inventory 17.7 18.9 16.5 Inventory days 77 78 83 68Payable days 57 59 65 55Customer financing, net 2.7 3.1 2.8 2.8Return on capital employed 4% 5% 7% 11%Equity ratio 52% 51% 52% 50%The net cash position amounted to SEK 33.9 (27.9) b., up SEK 6.0 b.in the quarter. Cash, cash equivalents and short-term investmentsamounted to SEK 79.8 (75.5) b.Customer financing remained low at of SEK 2.7 (3.1) b., reduced by alower USD rate.During the quarter, approximately SEK 3.1 b. of provisions wereutilized, of which SEK 1.2 b. were related to restructuring.Additions of SEK 2.2 b. were made, of which SEK 0.5 b. related torestructuring. Reversals of SEK 0.1 b. were made.Ericsson intends to repurchase its callable bond EUR LME 6.75%,maturing on November 28, 2010. The intention is to make a fullredemption on November 28, 2009, of all outstanding notes with atotal nominal amount of EUR 471 million. The repurchase will reducegross debt and improve annual interest net.COST REDUCTIONSIn January, 2009, cost reduction activities were initiated, targetingannual savings of SEK 10 b. from the second half of 2010, splitequally between cost of sales and operating expenses. Relatedrestructuring charges were estimated to SEK 6-7 b.Restructuring charges, excluding joint ventures, in the third quarterwere SEK 2.7 b. with a total of SEK 7.0 b. of charges year-to-date.At the end of the quarter, cash outlays of SEK 3.3 b. remain to bemade.The transition to IP technologies with fewer software platforms aswell as products with less hardware paves the way for synergieswithin the product portfolio. The program is ahead of plan andadditional opportunities for efficiency improvements have evolvedduring the program. This will lead to further cost savings andrelated charges during the last three quarters of the program. First FullRestructuring charges, Third Second quarter yearSEK b. quarter 2009 quarter 2009 2009 2008Cost of sales -0.8 -1.3 -0.4 -2.5Research anddevelopmentexpenses -1.8 -1.7 -0.3 -2.7Selling andadministrativeexpenses -0.1 -0.6 - -1.5Total -2.7 -3.6 -0.7 -6.7SEGMENT RESULTS Third quarter Second quarter Nine monthsSEK b. 2009 2008 Change 2009 Change 2009 2008 ChangeNetworks sales 30.3 33.0 -8% 34.7 -13% 98.6 96.3 2%Of which network 5.8 4.7 24% 5.9 -2% 16.4 14.0 18%rolloutEBITDA margin 15% 15% - 15% - 15% 15% -Operating margin 11% 11% - 11% - 11% 10% -ProfessionalServices 12.8 11.8 9% 14.1 -9% 39.7 32.8 21%salesOf which managed 3.6 3.5 3% 4.6 -22% 12.3 10.0 24%servicesEBITDA margin 17% 19% - 17% 1) - 17% 1) 17% -Operating margin 15% 16% - 16% 1) - 15% 1) 14% -Multimedia sales 3.4 3.5 -4% 3.3 1% 9.9 8.8 13%2)EBITDA margin 2) 19% 16% - 17% - 15% 9% -Operating margin 11% 9% - 9% - 7% 1% -2)Sales fromdivested and 0.0 0.9 - 0.0 - 0.0 4.0 -transferredbusinessesTotal sales 46.4 49.2 -6% 52.1 -11% 148.1 141.9 4%All numbers exclude restructuring charges1) Second quarter 2009 excludes a capital gain of SEK 0.8 b. fromdivestment of TEMS2) 2008 and 2009 numbers for Multimedia exclude divested EricssonMobile Platforms and PBX operationsNETWORKSNetwork sales in the third quarter declined year-over-year by 8%.Even thoughthe comparison is tough with last year's strong third quarter, themarket was weaker. The markets are fairly strong in the world'sleading economies, while demand is weaker in several emerging marketsaffected by the present economic climate.The rapid growth in demand for mobile broadband continues althoughthe growth does not yet offset this year's lower demand for GSM.The ongoing efficiency and cost reduction activities are driven bynew, less labor intense, products and fewer platforms. This leads toa consolidation of sites which is a key element in the ongoing costreduction activities. Effects from the program are already visible,and despite lower sales and a high level of network rollout,EBITDA-margin was flat at 15%.During the quarter, several strategic wins were achieved in mobileand IP and the footprint in North America was significantly improved. AT&T's selection of Ericsson as one of its domain suppliers ofwireline access, the LTE contract from Metro PCS and the plannedacquisition of Nortel's CDMA/LTE businesses, all contributed to thestrengthened position. The Nortel businesses are expected to beconsolidated in the fourth quarter and will be reported withinsegments Networks and Professional Services.PROFESSIONAL SERVICESProfessional Services sales increased 9% year-over-year. Growth inlocal currencies amounted to 4%. Total service sales, includingnetwork rollout, now account for 40% of Group sales. In the presentfinancial climate there is strong demand for services targeting theoperational efficiency of operators such as managed services andconsulting. However, managed services sales increased by just 3%year-over-year due to the reduced scope of the renewed agreement inItaly. Other professional services sales increased by 11%year-over-year.EBITDA-margin in the quarter declined to 17% (19%) negativelyimpacted by start-up costs from new managed services contracts withSprint, Zain as well as costs associated to the renewed agreement inItaly. This was partially offset by continued efficiency gains.The Sprint contract is a proof point of Ericsson's service offering,as the services relate to a network with no Ericsson equipment. Theadded CDMA competence brought by the former Sprint employees opens uppossibilities for further growth of the service business.The total number of subscribers in managed operations is now 350million, of which 50% are in high-growth markets.MULTIMEDIAMultimedia sales increased slightly sequentially despite seasonality.Multimedia brokering (IPX) and consumer and business applicationscontinued to show good growth.EBITDA-margin in the quarter for comparable units improved to 19%(16%).Sales and margins may still vary between quarters.SONY ERICSSON Second Third quarter quarter Nine monthsEUR m. 2009 2008 Change 2009 Change 2009 2008 ChangeNumber of unitsshipped (m.) 14.1 25.7 -45% 13.8 2% 42.5 72.5 -41%Average sellingprice(EUR) 114 109 5% 122 -7% 119 115 3%Net sales 1,619 2,808 -42% 1,684 -4% 5,038 8,330 -40%Gross margin 16% 22% - 12% - 12% 25% -Operating margin -12% -1% - -16% - -17% 2% -Income beforetaxes -199 -23 - -283 - -853 179 -Income beforetaxes, exclrestructuringcharges -198 12 - -283 - -838 225 -Net income -164 -25 - -213 - -669 114 -Units shipped in the quarter were 14.1 million, a sequential increaseof 2% and a decrease of 45% year-over-year. Sales in the quarter wereEUR 1,619 million, a sequential decrease of 4% and a decrease of 42%year-over-year.The sequential decline in average selling price was due to productmix and continued challenging market conditions. Gross marginimproved sequentially but dropped year-over-year due to lower salesand currency exchange rate effects.The sequential improvement was seen in both percentage rate and involume driven by cost saving activities and successful sales of theW995 Walkman phone.Income before taxes for the quarter, excluding restructuring charges,was a lossof EUR -198 (12) million. The loss in the second quarter was EUR -283million.The reduced loss was due to better cost of sales efficiency as wellas reduced operating expenses. As of September 30, 2009, SonyEricsson retained a net cash position of EUR 841 million.Since the beginning of the quarter, facilities of EUR 455 millionwere signed to strengthen the balance sheet and improve liquidity.EUR 155 million were drawn by the end of September and EUR 100million were drawn in the beginning of October. In addition, atwo-year committed back-up facility of EUR 200 million is availablebut has not been utilized. The parent companies have guaranteed EUR350 million of these facilities on a 50/50 basis.Bert Nordberg, former head of Ericsson Silicon Valley and ExecutiveVice President in Ericsson has been appointed President of SonyEricsson as of October 15, 2009.Ericsson's share in Sony Ericsson's income before tax was SEK -1.0(-0.1) b. in the quarter.ST-ERICSSON 2009 2008 Third Second ProformaUSD m. quarter quarter Feb-Mar third quarterNet sales 728 666 391 1,003Adjusted operating income 1) -77 -165 -78 -34Operating income before taxes -121 -224 -98 -59Net income -112 -213 -89 NA1) Operating loss adjusted for amortization of acquisition relatedintangibles and restructuring chargesNet sales in the quarter showed an increase of 9% sequentially withsolid performance in Asia.Adjusted operating loss in the quarter was USD -77 (-34) m. Theadjusted operating loss in the second quarter was USD -165 million.The reduced loss reflects a tight control of product costs andoperational expenses as well as positive seasonal effects. The USD250 m. cost synergies program, defined by ST-NXP Wireless in thethird quarter 2008, is now substantially completed. The newrestructuring plan of USD 230 m. cost synergies, announced at the endof April, had a limited benefit to the third quarter result.Gilles Delfassy, with a long experience from the microelectronicsbusiness has been appointed President and CEO of ST-Ericsson as ofNovember 2, 2009.ST-Ericsson is reported in US-GAAP. Ericsson's share in ST-Ericsson'sincome before tax, adjusted to IFRS, was SEK -0.5 b. in the quarter,including restructuring charges of SEK 0.1 b. Ericsson MobilePlatforms incurred a loss of SEK 0.5 b. in January 2009, which isadded to the result in segment ST-Ericsson year-to-date.REGIONAL OVERVIEW Third quarter Second quarter Nine monthsSales, SEK b. 2009 2008 Change 2009 Change 2009 2008 ChangeWestern Europe 10.1 11.6 -13% 11.4 -11% 32.7 35.4 -8%Central andEastern Europe, 11.6 13.1 -11% 12.6 -8% 36.7 35.5 4%Middle East andAfricaAsia Pacific 15.3 14.1 9% 17.4 -12% 49.0 42.8 15%Latin America 5.0 6.1 -18% 4.8 4% 14.2 15.2 -7%North America 4.4 4.3 1% 5.9 -27% 15.5 13.0 19%Total 46.4 49.2 -6% 52.1 -11% 148.1 141.9 4%Western Europe sales declined -6% year-over-year for comparableunits. However, the region showed growth when adjusting for theimpact of the reduced scope for the renewed managed servicesagreement in Italy. UK showed the strongest growth driven by managedservices while Spain is still weak. Mobile broadband is growingstrongly throughout the region. This creates demand for morespectrum, including new licenses for 2.6GHz and 800MHz spectrums andrefarming of existing spectrum. There is also a continued increase indemand for managed services.Sales in Central and Eastern Europe, Middle East and Africa decreasedby -11% year-over-year. This is the region presently most impactedby the economic climate including credit constraints. Egypt, Nigeria,Turkey and Saudi Arabia showed the strongest development. The Turkishmarket remains particularly strong with a continued fast rollout of3G networks. New licenses are issued in the region, latest inTunisia, where Ericsson was selected as one of the main suppliers ofa new 2G and 3G network. The interest for managed services is strongin the region and Ericsson has signed several new contracts.Asia Pacific sales increased 9% year-over-year. India was the largestmarket for Ericsson in the quarter. China sales were up significantlyyear-over-year due to major 3G rollouts. Japan and Vietnam alsoshowed strong growth while markets such as Bangladesh, Pakistan andIndonesia were down significantly. Several operators are forced todelay investments due to credit constraints despite traffic growth.Government driven next-generation broadband and fiber backhaulnetworks are being built in several countries across the region.Latin American sales decreased by -18% year-over-year with lowerdemand across the region. Demand for mobile broadband continues todevelop well. Meanwhile, due to delays of licensing of new spectrumand services, in larger countries like Mexico, Brazil and Argentina,operators hold back investmentsin new technologies and applications.North American sales increased by 1% year-over-year in a toughyear-over-year comparison. Data traffic shows strong growth and thedemand for mobile broadband is high. AT&T named Ericsson as a domainsupplier for their wireline access network. Ericsson was alsoselected sole LTE supplier to Metro PCS.The Sprint Network Advantage partnership commenced on September 21.MARKET DEVELOPMENTGROWTH RATES ARE BASED ON ERICSSON AND MARKET ESTIMATESThe global economic slowdown is affecting all parts of the society.However, we believe that the fundamentals for longer-term positivedevelopment for our industry remain solid. The need fortelecommunication continues to grow and plays a vital role for thedevelopment of a sustainable and prosperous society. Ericsson is wellpositioned to drive and benefit from this development.There is continued growth in mobile subscriptions, although thecurrent growth rate is lower than in 2008. Mobile subscriptions grewby some 133 million in the quarter to a total of 4.4 billion. InIndia alone subscriptions are growing by some 14 million per month.The global number of new WCDMA subscriptions is accelerating and grewby 36 million in the quarter to a total of 411 million. In the secondquarter, fixed broadband connections grew to 422 million, adding 12million subscribers.The traffic in the mobile networks is accelerating, which createsneed for new and expanded mobile networks and correspondingprofessional services. GSM/WCDMA/LTE is the dominating technologytrack. The build-out of telecommunications in emerging marketscontinues, and although they represent less than one third of globalGDP they represent significantly more of the market for mobilenetwork equipment.Data traffic, as part of operator revenues, continues to increase.For many large operators, mobile data revenues now constitute 25% oftotal service revenues or more. In addition to capacity enhancements,operators face the challenge of converting to all-IP broadbandnetworks. This will include increased deployments of broadbandaccess, routing and transmission equipment along with next-generationservice delivery and revenue management systems.There is continued strong growth in telecom services, fueled byoperators' desire to reduce operating expenses and improve efficiencyin network operation and maintenance. The move toward all-IP andincreased network complexity will create further demand for systemsintegration and consulting.PARENT COMPANY INFORMATIONNet sales for the nine-month period amounted to SEK 0.3 (4.1) b. andincome after financial items was SEK 5.8 (17.6) b. Effective January1, 2009, the right to all license revenues from third parties relatedto patent licenses has been transferred to Ericsson AB, a whollyowned subsidiary, and consequently net sales in 2009 will beinsignificant compared to 2008.Major changes in the Parent Company's financial position for thenine-month period include investments in the joint venture withST-Ericsson of SEK 8.4 b., decreased current and non-currentreceivables from subsidiaries of SEK 13.6 b. and increased cash andbank and short-term investments of SEK 8.2 b.Notes and bond loans increased by net SEK 5.8 b. through newborrowings and loan repayment during the second quarter. Current andnon-current liabilities to subsidiaries increased by SEK 2.9 b. andother current liabilities decreased by SEK 6.6 b. As per September30, 2009, cash and bank and short-term investments amounted to SEK67.4 (59.2) b.In accordance with the conditions of the Stock Purchase Plans andOption Plans for Ericsson employees, 2,164,500 shares from treasurystock were sold or distributed to employees during the third quarter.The holding of treasury stock at September 30, 2009, was 82,215,837Class B shares.OTHER INFORMATIONERICSSON TO ACQUIRE MAJORITY OF NORTEL'S NORTH AMERICAN WIRELESSBUSINESSOn July 25, 2009, Ericsson announced that it has entered into anasset purchase agreement to acquire the parts of the Carrier Networksdivision of Nortel relating to CDMA and LTE technology in NorthAmerica. The purchase is structured as an asset sale at a cashpurchase price of USD 1.13 b. on a cash and debt free basis.Completion of the transaction is still subject to approval in theUnited States.NEW PRESIDENT OF SONY ERICSSON APPOINTEDOn August 17, 2009, Bert Nordberg, Executive Vice President ofEricsson was appointed President of Sony Ericsson as of October 15,2009. Nordberg left his position in Ericsson when he joined SonyEricsson.NEW PRESIDENT AND CEO OF ST-ERICSSONOn September 2, 2009, Gilles Delfassy, was appointed President andCEO of ST-Ericsson as of November 2, 2009. Delfassy is a highlyregarded expert in the wireless industry.Head of strategy appointedOn August 11, 2009, Douglas L. Gilstrap was appointed Senior VicePresident and Head of Group Function Strategy as of October 1, 2009.Gilstrap brings more than 15 years of experience in the globaltelecommunications and IT industry.ASSESSMENT OF RISK ENVIRONMENTEricsson's operational and financial risk factors and uncertaintiesare described under "Risk factors Assessment of risk environment" inour Annual Report 2008.Risk factors and uncertainties in focus during the forthcomingsix-month period for the Parent Company and the Ericsson Groupinclude:* potential negative effects of the continued uncertainty in the financial markets and the weak economic business environment on operators' willingness to invest in network development as well as uncertainty regarding the financial stability of suppliers, for example due to lack of borrowing facilities, or reduced consumer telecom spending, or increased pressure on us to provide financing;* effects on gross margins and/or working capital of the product mix in the Networks segment between sales of software, upgrades and extensions and the pro-portion of new network build-outs and break-in contracts;* a volatile sales pattern in the Multimedia segment or variability in our overall sales seasonality could make it more difficult to forecast future sales;* results and capital needs of our two major joint ventures, Sony Ericsson and ST-Ericsson, which both are negatively affected to a larger extent than our three other segments by the current economic slowdown;* effects of the ongoing industry consolidation among our customers as well as between our largest competitors, e.g. intensified price competition;* changes in foreign exchange rates, in particular USD and EUR;* continued political unrest or instability in certain markets.Ericsson conducts business in certain countries which are subject totrade restrictions or which are focused on by certain investors. Westringently follow all relevant regulations and trade embargosapplicable to us in our dealings with customers operating in suchcountries. Moreover, Ericsson operates globally in accordance withGroup level policies and directives for business ethics and con-duct.In no way should our business activities in these countries beconstrued as supporting a particular political agenda or regime. Wehave activities in such countries mainly due to that certaincustomers with multi-country operations put demands on us to supportthem in all of their markets.Please refer further to Ericsson's Annual Report 2008, where wedescribe our risks and uncertainties along with our strategies andtactics to mitigate the risk exposures or limit unfavorable outcomes.Stockholm, October 22, 2009Carl-Henric SvanbergPresident and CEOTelefonaktiebolaget LM Ericsson (publ)Date for next report: January 25, 2010AUDITORS' REVIEW REPORTWe have reviewed this report for the period January 1 to September30, 2009, for Telefonaktiebolaget LM Ericsson (publ). The board ofdirectors and the CEO are responsible for the preparation andpresentation of this interim report in accordance with IAS 34 and theAnnual Accounts Act. Our responsibility is to ex-press a conclusionon this interim report based on our review.We conducted our review in accordance with the Standard on ReviewEngagements SÿG 2410, Review of Interim Financial InformationPerformed by the Independent Auditor of the Entity, issued by FARSRS. A review consists of making inquiries, primarily of personsresponsible for financial and accounting matters, and applyinganalytical and other review procedures. A review is substantiallyless in scope than an audit conducted in accordance with Standards onAuditing in Sweden, RS, and other generally accepted auditingpractices. The procedures performed in a review do not enable us toobtain a level of assurance that would make us aware of allsignificant matters that might be identified in an audit. Therefore,the conclusion expressed based on a review does not give the samelevel of assurance as a conclusion expressed based on an audit.Based on our review, nothing has come to our attention that causes usto believe that the interim report is not prepared, in all materialrespects, in accordance with IAS 34 and the Swedish Annual AccountsAct regarding the Group and with the Swedish Annual Accounts Actregarding the Parent Company.Stockholm, October 22, 2009PricewaterhouseCoopers ABPeter ClemedtsonAuthorized Public AccountantEDITOR'S NOTETo read the complete report with tables, please go to:www.ericsson.com/investors/financial_reports/2009/9month09-en.pdfEricsson invites media, investors and analysts to a press conferenceat the Ericsson headquarters, Torshamnsgatan 23, Stockholm, at 09.00(CET), October 22.An analysts, investors and media conference call will begin at 14.00(CET).Live webcasts of the press conference and conference call as well assupporting slides will be available at www.ericsson.com/press andwww.ericsson.com/investors.FOR FURTHER INFORMATION, PLEASE CONTACTHenry Sténson, Senior Vice President, CommunicationsPhone: +46 10 719 4044E-mail: investor.relations(at)ericsson.com orpress.relations(at)ericsson.comINVESTORSGary Pinkham, Vice President,Investor RelationsPhone: +46 10 719 0000E-mail: investor.relations(at)ericsson.comSusanne Andersson,Investor RelationsPhone: +46 10 719 4631E-mail: investor.relations(at)ericsson.comLars Jacobsson,Investor RelationsPhone: +46 10 719 9489E-mail: investor.relations(at)ericsson.comMEDIAÿse Lindskog, Vice President,Head of Public and Media RelationsPhone: +46 10 719 9725, +46 730 244 872E-mail: press.relations(at)ericsson.comOla Rembe,Public and Media RelationsPhone: +46 10 719 9727, +46 730 244 873E-mail: press.relations(at)ericsson.comTelefonaktiebolaget LM Ericsson (publ)Org. number: 556016-0680Torshamnsgatan 23SE-164 83 StockholmPhone: +46 10 719 0000www.ericsson.comDISCLOSURE PURSUANT TO THE SWEDISH SECURITIES MARKETS ACTEricsson discloses the information provided herein pursuant to theSecurities Markets Act. The information was submitted for publicationat 07.30 CET, on October 22, 2009.Safe Harbor Statement of Ericsson under the US Private SecuritiesLitigation Reform Act of 1995;All statements made or incorporated by reference in this release,other than statements or characterizations of historical facts, areforward-looking statements. These forward-looking statements arebased on our current expectations, estimates and projections aboutour industry, management's beliefs and certain assumptions made byus. Forward-looking statements can often be identified by words suchas "anticipates", "expects", "intends", "plans", "predicts","believes", "seeks", "estimates", "may", "will", "should", "would","potential", "continue", and variations or negatives of these words,and include, among others, statements regarding: (i) strategies,outlook and growth prospects; (ii) positioning to deliver futureplans and to realize potential for future growth; (iii) liquidity andcapital resources and expenditure, and our credit ratings; (iv)growth in demand for our products and services; (v) our joint ventureactivities; (vi) economic outlook and industry trends; (vii)developments of our markets; (viii) the impact of regulatoryinitiatives; (ix) re-search and development expenditures; (x) thestrength of our competitors; (xi) future cost savings; (xii) plans tolaunch new products and services; (xiii) assessments of risks; (xiv)integration of acquired businesses; (xv) compliance with rules andregulations and (xvi) infringements of intellectual property rightsof others.In addition, any statements that refer to expectations, projectionsor other characterizations of future events or circumstances,including any underlying assumptions, are forward-looking statements.These forward-looking statements speak only as of the date hereof andare based upon the information available to us at this time. Suchinformation is subject to change, and we will not necessarily informyou of such changes. These statements are not guarantees of futureperformance and are subject to risks, uncertainties and assumptionsthat are difficult to predict. Therefore, our actual results coulddiffer materially and adversely from those expressed in anyforward-looking statements as a result of various factors. Importantfactors that may cause such a difference for Ericsson include, butare not limited to: (i) material ad-verse changes in the markets inwhich we operate or in global economic conditions; (ii) increasedproduct and price competition; (iii) reductions in capitalexpenditure by network operators; (iv) the cost of technologicalinnovation and increased expenditure to improve quality of service;(v) significant changes in market share for our principal productsand services; (vi) foreign exchange rate or interest ratefluctuations; and (vii) the successful implementation of our businessand operational initiatives.http://hugin.info/1061/R/1349277/325107.pdfThis announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.
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