2nd Qtr &Interim Rslts-Part 2
Nokia Corporation
27 July 2000
PART 2
CONSOLIDATED PROFIT AND LOSS ACCOUNT, IAS, EUR million
(unaudited)
4-6/00 4-6/99 1-6/00 1-6/99 1-12/99
Net sales 6 980 4 493 13 517 8 363 19 772
Cost of sales -4 203 -2 783 -8 215 -5 112 -12 227
Research and development -677 -395 -1 207 -747 -1 755
expenses
Selling, general and -655 -419 -1 315 -826 -1 811
administrative expenses
Amortization of goodwill -33 -15 -52 -29 -71
Operating profit 1 412 881 2 728 1 649 3 908
Share of results of -1 -2 -4 -4 -5
associated companies
Financial income and 13 -2 33 -10 -58
expenses
Profit before tax and 1 424 877 2 757 1 635 3 845
minority interests
Tax -438 -280 -854 -526 -1 189
Minority interests -35 -16 -61 -23 -79
Net profit 951 581 1 842 1 086 2 577
Earnings per share, EUR
Basic 0.20 0.13 0.39 0.24 0.56
Diluted 0.20 0.12 0.39 0.22 0.54
Average number of shares
(1 000 shares)
Basic 4 673 061 4 591 940 4 663 503 4 589 740 4 593 761
Diluted 4 795 234 4 834 946 4 776 569 4 830 164 4 743 185
Depreciation 227 140 407 284 665
Currency rate June 30, 2000, 1 EUR = 0.947 USD, 1 EUR = 5.94573 FIM
NET SALES BY BUSINESS GROUP, EUR million
(unaudited)
4-6/00 4-6/99 1-6/00 1-6/99 1-12/99
Nokia Networks 1 925 1 390 3 427 2 498 5 673
Nokia Mobile Phones 4 883 2 922 9 722 5 499 13 182
Nokia Ventures 193 67 404 131 415
Organization
Discontinued Display - 136 - 270 580
Products
Inter-business group -21 -22 -36 -35 -78
eliminations
Nokia Group 6 980 4 493 13 517 8 363 19 772
OPERATING PROFIT BY BUSINESS GROUP, EUR million
4-6/00 4-6/99 1-6/00 1-6/99 1-12/99
Nokia Networks 348 274 621 500 1 082
Nokia Mobile Phones 1 221 671 2 382 1 287 3 099
Nokia Ventures -108 -31 -178 -53 -175
Organization
Common Group Expenses -49 -33 -97 -85 -98
Nokia Group 1 412 881 2 728 1 649 3 908
CONDENSED CASH FLOW STATEMENT, IAS, EUR million
(unaudited)
1-6/00 1-6/99 1-12/99
Net cash from operating activities 1 604 1 520 3 102
Net cash used in investing activities -936 -663 -1 341
Net cash used in financing activities -1 242 -931 -592
Net increase in cash and cash equivalents -574 -74 1 169
Cash and cash equivalents 4 200 2 970 2 990
at beginning of period
Cash and cash equivalents 3 626 2 896 4 159
at end of period
Dividends
In 2000 dividends to Nokia Oyj's shareholders (EUR 931 million) were
booked as liability at the end of the first quarter. The dividends
were paid in April and had an impact on cash flow and gearing in the
second quarter. In 1999 net cash used in financing activities includes
dividends paid EUR 586 million.
Currency rate June 30, 2000, 1 EUR = 0.947 USD, 1 EUR = 5.94573 FIM
CONSOLIDATED BALANCE SHEET, IAS, EUR million
(unaudited) 30.6.2000 30.6.1999 31.12.1999
ASSETS
Fixed assets and other non-
current assets
Intangible assets 1 260 663 838
Property, plant and 2 359 1 617 2 031
equipment
Investments in associated 88 82 76
companies
Investments in other 161 65 68
companies
Deferred tax assets 413 259 257
Other assets 768 67 217
5 049 2 753 3 487
Current assets
Inventories 2 418 1 634 1 772
Receivables 5 604 4 010 4 861
Short-term investments 2 605 2 054 3 136
Bank and cash 1 021 843 1 023
11 648 8 541 10 792
Total assets 16 697 11 294 14 279
SHAREHOLDERS' EQUITY AND
LIABILITIES
Shareholders' equity
Share capital 281 291 279
Share issue premium 1 427 887 1 079
Treasury shares -151 -110 -24
Translation differences 270 213 243
Retained earnings 6 559 4 389 5 801
8 386 5 670 7 378
Minority interests 173 89 122
Long-term liabilities
Long-term interest bearing 266 290 269
liabilities
Deferred tax liabilities 83 86 80
Other long-term 72 48 58
liabilities
421 424 407
Current liabilities
Short-term borrowings 819 431 792
Current portion of long-term 1 5 1
debt
Accounts payable 2 509 1 845 2 202
Accrued expenses 4 388 2 830 3 377
7 717 5 111 6 372
Total shareholders' equity and 16 697 11 294 14 279
liabilities
Interest-bearing liabilities 1 086 726 1 062
Net debt to equity (gearing), % -30 -38 -41
Shareholders' equity per 1.79 1.24 1.59
share, EUR
Number of shares (1000 shares)* 4 676 847 4 593 200 4 652 679
Change in Nokia Accounting Principles: In 2000, the Group has adopted
the new IAS 37, Provisions, Contingent Liabilities and Contingent
Assets, and recognized a provision for social security costs on
unexercised stock options granted to employees. In accordance with the
transitional rule of IAS 37 the cumulative prior year net of tax
effect (206 MEUR) has been recorded as an adjustment to retained
earnings.
* Shares owned by Group companies are excluded
Currency rate June 30, 2000, 1 EUR = 0.947 USD, 1 EUR = 5.94573 FIM
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, EUR million
(unaudited)
Share
Share issue Treasury Translation Retained Total
Capital premium shares differences Earnings
Balance at
December 31, 1998 255 909 -110 182 3 873 5 109
Share issue 14 14
Bonus issues 36 -36 -
Dividend -586 -586
Translation 31 31
differences
Other increase/ 16 16
decrease, net
Net profit 1 086 1 086
Balance at
June 30, 1999 291 887 -110 213 4 389 5 670
Balance at
December 31, 1999 279 1 079 -24 243 5 801 7 378
Share issue 2 348 350
Acquisition of -127 -127
treasury
shares
Dividend -931 -931
Translation 27 27
differences
Change in -206 -206
accounting policy
Other increase/ 53 53
decrease, net
Net profit 1 842 1 842
Balance at
June 30, 2000 281 1 427 -151 270 6 559 8 386
COMMITMENTS AND CONTINGENCIES, EUR million
(unaudited) GROUP
30.6.2000 30.6.1999 31.12.1999
Collateral for own commitments
Mortgages 12 6 6
Assets pledged 3 7 3
Contingent liabilities on behalf of
Group companies
Other guarantees 576 441 427
Contingent liabilities on behalf of
other companies
Guarantees for loans 267 143 234
Other guarantees 1 1 -
Leasing obligations 862 510 560
Currency rate June 30, 2000, 1 EUR = 0.947 USD, 1 EUR = 5.94573 FIM
NOTIONAL AMOUNTS OF DERIVATIVE FINANCIAL INSTRUMENTS, EUR million 1)
(unaudited)
30.6.2000 30.6.1999 31.12.1999
Foreign exchange forward 10 137 9 050 9 473
contracts 2) 3)
Currency options bought 2 292 689 1 184
Currency options sold 1 914 698 978
Interest rate forward and - 315 598
futures contracts 2)
Interest rate swaps 250 50 250
Cash settled equity swaps 4) 372 - -
1) The notional amounts of derivatives summarized here do not
represent amounts exchanged by the parties and, thus are not a measure
of the exposure of Nokia caused by its use of derivatives.
2) Notional amounts outstanding include positions, which have been
closed off.
3) Notional amount includes contracts used to hedge the net
investments in foreign subsidiaries.
4) Cash settled equity swaps are used to hedge risks relating to
incentive programs and investment activities.
Currency rate June 30, 2000, 1 EUR = 0.947 USD, 1 EUR = 5.94573 FIM
It should be noted that certain statements herein which are not
historical facts, including, without limitation those regarding 1) the
timing of product deliveries; 2) the Company's ability to develop new
products and technologies; 3) expectations regarding market growth and
developments; 4) expectations for growth and profitability; and 5)
statements preceded by 'believes', 'expects', 'anticipates',
'foresees', or similar expressions, are forward-looking statements.
Because such statements involve risks and uncertainties, actual
results may differ materially from the results currently expected by
the Company. Factors that could cause such differences include, but
are not limited to 1) general economic conditions, such as the rate of
economic growth in the Company's principal geographic markets or
fluctuations in exchange rates; 2) industry conditions, such as the
strength of product demand, the intensity of competition, pricing
pressures, the acceptability of new product introductions, the
introduction of new products by competitors, changes in technology,
the ability of the Company to source components from third parties
without interruption and at reasonable prices, and the financial
condition of the Company's customers; 3) operating factors, such as
continued success of manufacturing activities and the achievement of
efficiencies therein, continued success of product development or
inventory risks due to shifts in market demand; as well as 4) the risk
factors specified on pages 21 to 23 of the Company's Form 20-F for the
year ended December 31, 1999.
NOKIA
Helsinki, July 27, 2000
For more information:
Lauri Kivinen, Corporate Communications, tel. +358 9 1807 495,
lauri.kivinen@nokia.com
Ulla James, Investor Relations, tel. +1 972 894 4880,
ulla.james@nokia.com
Antti Raikkonen, Investor Relations, tel. +358 9 1807 290,
antti.raikkonen@nokia.com
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