European Earnings: Ericsson Shares Soar
Earnings news dominated Friday's European trade with Sweden's Ericsson's shares up more than 12 percent after the company reported better-than-expected results.
The world's largest mobile network maker also affirmed it was planning on a flat mobile infrastructure market this year.
The company reports an operating profit of 4.3 billion Swedish crowns in the first quarter, a sharp drop from 7.6 billion in the fourth quarter and 8.2 billion a year earlier.
But that was more than the 3.7 billion mean average forecast in a Reuters poll of 28 analysts, although predictions ranged from 1.5 billion crowns to 5.5 billion.
"Our business developed well in the quarter, considering the present market environment and the declining dollar," said Carl-Henric Svanberg, Ericsson's chief executive.
The company said it had a 9.7 percent operating margin, down from 19.3 percent a year earlier but higher than forecasts for 8.8 percent.
Also in Sweden, truck maker Volvo posted first-quarter pretax earnings above market expectations and raised its market forecast for Europe, saying order intake there was surprisingly strong.
Volvo reported pretax profit of 6.14 billion Swedish crowns ($1 billion) versus a year-earlier 5.41 billion and a mean forecast of 5.71 billion in a Reuters poll of 17 analysts.
Competitor MANraised its forecast for 2008 revenue and profitability while reporting first-quarter results that soundly beat market expectations, thanks in part to cost savings.
With all three manufacturing divisions reporting sharp improvements, group operating profit jumped 43 percent to 455 million euros ($716.9 million) – far better than the average estimate of 397 million from a Reuters poll of 15 analysts.
WPP Group, the world's second-largest advertising company, reported first-quarter like-for-like revenue growth towards the low end of forecasts but said trading had held up well in the United States.
The group whose agencies include JWT and Ogilvy & Mather posted better-than-expected revenue growth and said its operating margins and profitability were ahead of budget and last year.
It said trading had slowed in March in Western Europe but North America had remained relatively strong and better than last year, despite talk of recession and the problems affecting major financial institutions.
Reported revenue growth rose by 14.1 percent to 1.56 billion pounds ($3.1 billion), which was ahead of expectations at 1.51 billion pounds.
Insurer Aviva beat forecasts with a 5 percent rise in first-quarter sales, helped by growth in U.S. and Asia, but gave one of the gloomiest outlooks yet for a UK market it says will shrink over the coming months.
Aviva, which competes with Prudential for the top spot in UK insurance by market value, expects the UK life market to grow 5 percent at most in 2008, but only thanks to a recovery in the second half, as comparatives ease and investors unsettled by the global crunch eye products with guaranteed returns.
Over the first three months of the year, Aviva's total lifeand pensions sales climbed to 8.17 billion pounds ($16.15 billion), beating analysts' average forecast of 8.03 billion.
British publisher Pearson, the owner of the Financial Times newspaper and Penguin books, said on Friday it had made a good start to 2008 and was trading in line with its expectations.
And staffing company Randstad said its first-quarter net profit rose 3 percent, just short of analyst forecasts, and warned of a challenging market in North America.
Netherlands-based Randstad, which is taking over Vedior to create the world's number two staffing firm, had 73.3 million euros ($115.5 million) in profit compared with an average forecast of 75 million euros in a Reuters poll of nine analysts.
Vedior also reported earnings.
Its first-quarter net profit rose by 5 percent, matching market expectations, thanks to robust growth in its main French market.
It had a net profit of 46.9 million euros versus an average forecast of 48 million euros in a Reuters poll of five analysts.
-- Reuters contributed to this report