STOCKHOLM, Sweden, Jan. 30, 2014 (GLOBE NEWSWIRE) -- Fourth quarter highlights
- Sales of SEK 67.0 b., flat YoY.
- Sales for comparable units and adjusted for FX, increased 4% YoY.
- Operating income incl. JV of SEK 9.1 (-3.8) b. with operating margin of 13.5% (-5.7%), including a one-time charge of SEK -0.4 b. related to the acquisition of Airvana
- Net income SEK 6.4 (-6.3) b.
- Successfully closed an IPR cross license agreement with Samsung on FRAND terms. Impact on net sales of SEK 4.2 b., on operating income of SEK 4.2 b. and on net income of SEK 3.3 b. included in all numbers.
- EPS diluted SEK 1.97 (-1.99). EPS Non-IFRS SEK 2.42 (-1.40).
- Cash flow from operating activities of SEK 14.6 (15.7) b.
- Segment Modems was consolidated as of October 1, 2013
Full year highlights
- Sales of SEK 227.4 b., flat YoY.
- Sales for comparable units and adjusted for FX, up 5% YoY.
- Operating income incl. JV was SEK 17.8 (10.5) b. with an operating margin of 7.8% (4.6%).
- Net income SEK 12.2 (5.9) b.
- All numbers include effects of the IPR cross license agreement with Samsung with impact on net sales of SEK 4.2 b., on operating income of SEK 4.2 b. and on net income of SEK 3.3 b.
- EPS diluted SEK 3.69 (1.78). EPS Non-IFRS SEK 5.62 (3.55).
- Cash flow from operating activities of SEK 17.4 (22.0) b.
- Proposed dividend for 2013 of SEK 3.00 (2.75) per share.
|SEK b.|| Q4|
| Full year|
|Full year 20122)||Full year Change|
|Of which Networks||34.8||35.3||-1%||26.7||30%||117.7||117.3||0%|
|Of which Global Services||27.2||28.0||-3%||24.0||13%||97.4||97.0||0%|
|Of which Support Solutions||5.1||3.6||41%||2.4||117%||12.2||13.5||-9%|
|Of which Modems||0.0||-||-||-||-||0.0||-||-|
|Operating income excl JV||9.1||4.8||90%||4.3||112%||18.0||22.2||-19%|
|Operating margin excl JV||13.5%||7.1%||-||8.1%||-||7.9%||9.7%||-|
|Operating income incl JV||9.1||-3.83)||-||4.2||115%||17.8||10.53)||71%|
|Operating margin incl JV||13.5%||-5.7%||-||8.0%||-||7.8%||4.6%||-|
|EPS diluted, SEK||1.97||-1.99||-||0.90||119%||3.69||1.78||107%|
|EPS (Non-IFRS), SEK1)||2.42||-1.40||-||1.31||85%||5.62||3.55||58%|
|Cash flow from operating activities||14.6||15.7||-7%||1.5||-||17.4||22.0||-21%|
|Net cash, end of period||37.8||38.5||-2%||24.7||53%||37.8||38.5||-2%|
| 1) EPS, diluted, excl. restructuring, amortizations and write-downs of acquired intangible assets |
2) Including gain from divestment of Sony Ericsson of SEK 7.7 b
3) Including a charge related to ST-Ericsson of SEK -8.0 b
Comments from Hans Vestberg, President and CEO
"Ericsson's sales for comparable units, adjusted for FX, grew 5% for the full year. I am pleased that we have successfully closed the IPR cross-licensing agreement with Samsung. Our industry is built on scale and a strong tradition of sharing technologies through licensing on fair, reasonable and non-discriminatory (FRAND) terms. The agreement shows the value of our R&D investments and enables both companies to continue to innovate and bring new technologies to the market," says Hans Vestberg, President and CEO of Ericsson (NASDAQ:ERIC).
"Our focus on profitability started to pay off and operating margin for the group gradually improved in 2013, despite significant currency headwind, driven primarily by improvements in Networks and Network Rollout.
The business mix, with a higher share of coverage projects than capacity projects, started to shift towards more capacity during the year. As anticipated, sales came under some pressure during the quarter. As previously communicated, the major reason behind this development is the two large mobile broadband coverage projects, which peaked in North America in the first half of 2013 and the impact from reduced activity in Japan.
While executing on the large rollout projects in the US, we have also strengthened our professional services position and capabilities. For the full year Global Services accounted for the majority of the region's sales and we are today the market leader in both telecom services and mobile infrastructure in one of the world's most advanced and dynamic ICT markets.
The LTE tenders in China continue and so far the two major operators that have made their vendor selections have chosen Ericsson. During the quarter, sales in China improved as a result of deliveries to the ongoing mobile broadband coverage projects.
In the fourth quarter Ericsson continued to grow in some of its European key markets. During the last years we have strengthened our position in Europe through the network modernization projects. These projects have been delivered according to plan and the major part of the negative margin impact from these projects is now behind us. Over time, we expect the telecom industry in Europe to improve driven by macroeconomic development and a recent investment announcement made by one of the large operators.
During 2013 Ericsson executed on a number of strategic initiatives to both manage the ongoing technology transition in the industry and to transform the company for future business opportunities. We have solidified our core business as well as taken important steps to build a leadership position in new and targeted key areas. This includes consolidating the modems business and the acquisition of the IPTV business Mediaroom from Microsoft. We will gradually increase resource and capital allocation in these areas as well as in IP, Cloud, OSS and BSS.
The long-term fundamentals in the industry remain attractive and with our ongoing strategic initiatives we are well positioned to continue to support our customers in a transforming ICT market.
We have worked diligently to improve working capital and we ended the year with a strong cash flow of SEK 17.4 (22.0) b. and a full-year cash conversion of 79%, above the target of 70%, giving Ericsson a solid balance sheet to continue to execute on our strategy. The Board of Directors proposes a dividend for 2013 of SEK 3.00 (2.75) per share, an increase by 9%," concludes Vestberg.
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/2013/12month13-en.pdf or go to: www.ericsson.com/investors
Ericsson invites media, investors and analysts to a press conference at the Ericsson Studio, Grönlandsgången 4, Stockholm, at 09.00 (CET), January 30, 2014. An analysts, investors and media conference call will begin at 14.00 (CET).
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 34 72
Peter Nyquist, Head of Investor Relations
Phone: +46 10 714 64 49
Åsa Konnbjer, Director, Investor Relations
Phone: +46 10 713 39 28
Stefan Jelvin, Director, Investor Relations
Phone: +46 10 714 20 39
Rikard Tunedal, Director, Investor Relations
Phone: +46 10 714 54 00
Ola Rembe, Vice President, Head of External Communications
Phone: +46 10 719 97 27
Phone: +46 10 719 69 92
Ericsson discloses the information provided herein pursuant to the Securities Markets Act. The information was submitted for publication at 07.30 CET, on January 30, 2014.
Fourth quarter and full year report 2013 http://hugin.info/1061/R/1757959/594255.pdf