Nokia Solutions and Network just posted a profits !
ress Release from NSN:
Q2 2013 Net Sales of EUR 2.8 billion and Operating Margin Before Specific Items** of 12.2%
Second quarter 2013 net sales of EUR 2 758 million declined 14.7% year-on-year, but increased 1.5% sequentially. Excluding businesses divested and the exiting of certain customer contracts and countries, net sales were down approximately 11% year-on-year on a constant currency basis, but were up approximately 4% sequentially on a constant currency basis.
Gross margin before specific items** was 38.4% in the second quarter 2013, an improvement of 12.2 percentage points from the second quarter 2012 and an increase of 4.6 percentage points from the first quarter 2013. The year-on-year improvement was primarily due to higher gross margin in both Mobile Broadband and Global Services and non-recurring IPR income of EUR 17 million, as well as a slightly higher proportion of Mobile Broadband within the total sales mix. On a sequential basis, the increase in NSN gross margin before specific items** in the second quarter 2013 was due to significantly higher gross margin in Global Services as well as non-recurring IPR income of EUR 17 million, partially offset by lower gross margin in Mobile Broadband.
Operating expenses before specific items** in the second quarter 2013 were EUR 722 million, down from EUR 820 million in the second quarter 2012 and approximately flat compared to EUR 717 million in the first quarter 2013. On a year-on-year basis, operating expenses before specific items** were lower primarily due to reduced investments in business activities that are not consistent with the focused strategy and structural cost savings from NSN’s transformation and restructuring program, partially offset by higher investments in areas that are consistent with our focused strategy, most notably LTE.
In the second quarter 2013, NSN delivered operating margin before specific items** of 12.2%, driven by strong execution of NSN’s focused strategy. Operating margin before specific items** was 0.9% in the second quarter 2012 and 7.4% in the first quarter 2013.
As a result of the increased savings in the first half of 2013, and an accelerated pace of execution, we have, as already announced recently, increased the target for a reduction in annualized operating expenses and production overheads, excluding specific items, to more than EUR 1.5 billion by the end of 2013, compared to the end of 2011.
Free cash flow was EUR 5 million in the second quarter 2013, compared to EUR 121 million in the second quarter 2012 and EUR 239 million in the first quarter 2013. In the second quarter 2013, NSN’s free cash flow was affected negatively by net working capital-related outflows of EUR 239 million which included approximately EUR 190 million of restructuring-related outflows.
On July 1, 2013, Nokia Corporation and Siemens AG announced that they have entered into a definitive agreement pursuant to which Nokia acquires Siemens’ entire 50% stake in NSN. As announced on August 7, 2013, the transaction has been completed. In accordance with this transaction, the Siemens name is being phased out from Nokia Siemens Networks’ company name and branding. The new name and brand is Nokia Solutions and Networks, referred to as NSN, which will be used also for financial reporting purposes. Nokia Solutions and Networks is wholly owned by Nokia and will continue to be consolidated by Nokia.
Rajeev Suri, Chief Executive Officer of NSN:
“Our fourth consecutive quarter of strong profitability is testament to excellent performance in both our Mobile Broadband and Global Services segments. As a result of our focused strategy and strong financial position, we believe NSN is very well positioned to build on its leadership position in LTE as our customers build the next generation of mobile broadband networks.”
This is a good start for Nokia and NSN!
Source: Nokia Press and TimesOfIndia!