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Alcatel-Lucent to narrow focus, boost cash under new plan
2013-06-19 09:22:00| Telecompaper Headlines
(Telecompaper) Alcatel-Lucent's new CEO Michel Combes has announced his strategic plans for the company. Termed 'The Shift Plan', the three-year strategy will re-focus the company on IP networking and ultra-broadband access. Alcatel-Lucent will work more on co-development with partners and customers in these areas and significantly reduce spending on its other product lines. Under the new strategy, certain key businesses in wireless, fixed access and other areas will be managed with a focus on cash generation, in order to open up opportunities for investing in new technologies such as LTE, vectoring and FTTx. Overall the Core Networking activities are expected grow by more than 15 percent, from EUR 6.1 billion in 2012 to over EUR 7 billion in 2015, while the operating margin increases from 2.4 percent to more than 12.5 percent over the same period. Additional cost reductions of EUR 1 billion on SG&A and operational efficiencies are targeted, as well as EUR 1 billion in proceeds from selling assets. The CEO also plans a refinancing of EUR 2 billion debt in the near term, followed by a debt reduction of EUR 2 billion once the Shift Plan has started paying off. Overall the plan is expected to be self-financing, with no need to raise additional debt or capital. Alcatel-Lucent also announced the appointment of Philippe Guillemot, the former CEO of nuclear energy group Areva T&D, as Senior Executive Vice President, Operations.
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Category:Telecommunications