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Ericsson sales growth slows to 2% in Q1

2013-04-24 08:30:00| Telecompaper Headlines

(Telecompaper) Ericsson reported first-quarter sales up 2 percent year-on-year to SEK 52.0 billion. On a comparable basis and excluding forex effects, sales increased 7 percent from a year earlier and were down 19 percent from Q4. Ericsson said growth was led by the Networks division and roll-out services, with a number of projects in Europe and North America. Networks revenues were up 3 percent to SEK 28.1 billion, and Global Services sales rose 4 percent to SEK 21.5 billion. Operating profit, including income from joint ventures, fell 77 percent from a year earlier to SEK 2.1 billion, hurt by a charge of SEK 1.4 billion for the restructuring in Sweden amd the gain of SEK 7.7 billion last year from the divestment of Sony Ericsson. Net profit fell to SEK 1.2 billion from SEK 8.8 billion a year ago. Operating cash flow was a negative SEK 3.0 billion due to higher working capital, and net cash decreased by SEK 6.3 billion from the end of 2012 to SEK 32.2 billion. Ericsson was positive on the outlook, with 4G procurement starting in Russia and China, 21 new managed services contracts signed in the past quarter and strong demand for its SSR routing platform as well as OSS and BSS. While coverage projects have continued to have a higher share than capacity projects, the company expects an improvement in the business mix towards more capacity projects during the second half of 2013.

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