|
Nokia profit rises
|
 |
April 20, 2001: 7:43 a.m. ET
World's No. 1 mobile phone maker beats lowered target, cuts sales outlook
|
LONDON (CNN) - Nokia, the world's No. 1 mobile phone maker, cut its sales outlook on Friday as the firm said first-quarter profit beat its lowered estimate.
The Finnish company said pretax profit for the three months ended March 31 rose to  1.48 billion ($1.32 billion) from 1.35 billion in the first quarter 2000, as net sales grew by 22 percent to more than 8 billion.
 "During the quarter, we continued to increase our market share in both handsets and networks and we again sustained profitable growth and strong positive operating cashflow," Jorma Ollila, Nokia's chief executive, said in a statement.
But Nokia said it expects sales growth of 20 percent for both the second quarter and the full year, down from its estimate of 25-35 percent for the first half.
"Current economic uncertainties and the transition to packet-based services continue to limit our visibility for the remainder of 2001," Nokia said.
Earnings per share rose to 0.20, compared with 0.19 in the same quarter last year and beating Nokia's estimate of 0.19. The company reported EPS of 0.22, reflecting a change in accounting standards, and expects EPS of 0.20 in the second quarter.
"If Nokia makes it over the two first quarters... it means full-year EPS will grow, and when you consider that rivals' results will crash, it is a great achievement," Jussi Hyoty, analyst of FIM Securities in Helsinki, told Reuters.
Nokia last month had lowered its forecast for first quarter sales growth to 20 percent.
click here for wireless stock quotes
Operating margins in the first quarter fell to 18 percent, from 20.4 percent in the first quarter 2001 and 21.3 percent in the fourth quarter.
Nokia on Friday also lowered its full year operating margin forecast for its handset unit to the "high teens" from an earlier estimate of 20 percent by the end of the year.
 Nokia said its networks business saw net sales growth of 35 percent, while phone sales jumped 20 percent.
The company said it posted a 15 percent increase in net income to 1.04 billion from 910 million in the same quarter last year. Operating profit increased by 8 percent to 1.44 billion. All profit figures excluded a charge of 71 million associated with acquisitions.
Nokia's performance contrasts with that of its struggling Swedish rival Ericsson, which on Friday reported a first-quarter loss of $488 million and announced plans to cut 10,000 jobs. U.S. peer Motorola (MOT: Research, Estimates) has also warned of a loss and more than 20,000 job cuts.
Nokia shares rose more than 0.8 percent to 33.85 in Helsinki midday trade.
The company stood by its lowered estimate of the global handset market volume of 450-500 million in 2001.
Chris Doyle, telecom analyst at Charles River Associates, told CNN he expected more consolidation in the mobile phone market as global mobile phone handset sales fall by a likely 20 percent this year to 450 million.
"The smaller players need to consolidate, but it will take time to deliver those synergies to the market," Doyle said.
"We've already seen slowdown in the mobile phone market and penetration is already high," he added. 
|
|
|
|
|
 |
|
