Nokia Q2 2009 net sales EUR 9.9 billion, non-IF...
Corporate news announcement processed and transmitted by Hugin AS.
The issuer is solely responsible for the content of this
announcement.
----------------------------------------------------------------------
--------------
Non-IFRS operating margin in Devices & Services up sequentially to
12.2% (reported 11.6%)
Nokia Corporation
Interim Report
July 16, 2009 at 13.00 (CET +1)
The complete press release with tables is available at:
http://www.nokia.com/results/Nokia_results2009Q2e.pdf
+-------------------------------------------------------------------+
| | |
| | Non-IFRS second quarter 2009 results1,2,3 |
|-------------------+-----------------------------------------------|
| | | | YoY | | QoQ |
|-------------------+---------+---------+--------+---------+--------|
| EUR million | Q2/2009 | Q2/2008 | Change | Q1/2009 | Change |
|-------------------+---------+---------+--------+---------+--------|
| Net sales | 9 913 | 13 155 | -24.6% | 9 276 | 6.9% |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 6 586 | 9 090 | -27.5% | 6 173 | 6.7% |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | 148 | | | 134 | 10.4% |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | 3 199 | 4 071 | -21.4% | 2 990 | 7.0% |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| Operating profit | 775 | 2 054 | -62.3% | 514 | 50.8% |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 802 | 1 824 | -56.0% | 642 | 24.9% |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | 19 | | | 5 | 280.0% |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | 2 | 274 | -99.3% | -122 | |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| Operating margin | 7.8% | 15.6% | | 5.5% | |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 12.2% | 20.1% | | 10.4% | |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | 12.8% | | | 3.7% | |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | 0.1% | 6.7% | | -4.1% | |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| EPS, EUR Diluted | 0.15 | 0.37 | -59.5% | 0.10 | 50.0% |
|-------------------+--------------------------------------+--------|
| | | |
|-------------------+-----------------------------------------------|
| | |
| | Reported second quarter 2009 results1,3 |
|-------------------+-----------------------------------------------|
| | | | YoY | | QoQ |
|-------------------+---------+---------+--------+---------+--------|
| EUR million | Q2/2009 | Q2/2008 | Change | Q1/2009 | Change |
|-------------------+---------+---------+--------+---------+--------|
| Net sales | 9 912 | 13 151 | -24.6% | 9 274 | 6.9% |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 6 586 | 9 090 | -27.5% | 6 173 | 6.7% |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | 147 | | | 132 | 11.4% |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | 3 199 | 4 067 | -21.3% | 2 990 | 7.0% |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| Operating profit | 427 | 1 474 | -71.0% | 55 | 676.4% |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 763 | 1 565 | -51.2% | 547 | 39.5% |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | -100 | | | -120 | -16.7% |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | -188 | -47 | 300.0% | -361 | -47.9% |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| Operating margin | 4.3% | 11.2% | | 0.6% | |
|-------------------+---------+---------+--------+---------+--------|
| Devices & | | | | | |
| Services | 11.6% | 17.2% | | 8.9% | |
|-------------------+---------+---------+--------+---------+--------|
| NAVTEQ | -68.0% | | | -90.9% | |
|-------------------+---------+---------+--------+---------+--------|
| Nokia Siemens | | | | | |
| Networks | -5.9% | -1.2% | | -12.1% | |
|-------------------+---------+---------+--------+---------+--------|
| | | | | | |
|-------------------+---------+---------+--------+---------+--------|
| EPS, EUR Diluted | 0.10 | 0.29 | -65.5% | 0.03 | 233.3% |
+-------------------------------------------------------------------+
Note 1 relating to NAVTEQ: On July 10, 2008, Nokia completed the
acquisition of NAVTEQ Corporation. NAVTEQ is a separate reportable
segment of Nokia starting from the third quarter 2008. Accordingly,
the results of NAVTEQ are not available for the prior periods.
Note 2 relating to non-IFRS results: Non-IFRS results exclude special
items for all periods. In addition, non-IFRS results exclude
intangible asset amortization, other purchase price accounting
related items and inventory value adjustments arising from i) the
formation of Nokia Siemens Networks and ii) all business acquisitions
completed after June 30, 2008. More specific information about the
exclusions from the non-IFRS results may be found in this press
release on pages 3, 10 and 13-17.
Nokia believes that these non-IFRS financial measures provide
meaningful supplemental information to both management and investors
regarding Nokia's performance by excluding the above-described items
that may not be indicative of Nokia's business operating results.
These non-IFRS financial measures should not be viewed in isolation
or as substitutes to the equivalent IFRS measure(s), but should be
used in conjunction with the most directly comparable IFRS measure(s)
in the reported results. A reconciliation of the non-IFRS results to
our reported results for Q2 2009 and Q2 2008 can be found in the
tables on pages 10 and 13-17 of this press release. A reconciliation
of our Q1 2009 non-IFRS results can be found on pages 12-16 of our Q1
2009 Interim Report of April 16, 2009.
Note 3: Nokia reported net sales were EUR 19 186 million and earnings
per share (diluted) were EUR 0.13 for the period from January 1 to
June 30, 2009. Further information about the results for the period
from January 1 to June 30, 2009 can be found in this press release on
pages 9, 11, and 18-23.
SECOND QUARTER 2009 HIGHLIGHTS
- Nokia net sales of EUR 9.9 billion, down 25% year on year and up 7%
sequentially (down 24% and up 7% at constant currency).
- Devices & Services net sales of EUR 6.6 billion, down 28% year on
year and up 7% sequentially (down 28% and up 7% at constant
currency), and non-IFRS operating margin of 12.2% (20.1% in Q2 2008).
- Devices & Services gross margin of 34.0%, up from 33.8% in Q1 2009.
- Services net sales of EUR 140 million (billings of EUR 207
million). Due to the divestment of the security appliance business in
April 2009, services net sales are not directly comparable to prior
periods.
- Estimated industry mobile device volumes of 268 million units, down
12% year on year and up 5% sequentially.
- Nokia mobile device volumes of 103.2 million units, down 15% year
on year and up 11% sequentially.
- Nokia estimated mobile device market share of 38% in Q2 2009, down
from 40% in Q2 2008 and up from 37% in Q1 2009.
- Nokia mobile device ASP of EUR 62, down from EUR 65 in Q1 2009.
- NAVTEQ net sales of EUR 147 million, up 11% sequentially, and
non-IFRS operating margin of 12.8% (3.7% in Q1 2009)
- Nokia Siemens Networks net sales of EUR 3.2 billion, down 21% year
on year and up 7% sequentially (down 20% and up 8% at constant
currency), and non-IFRS operating margin of 0.1% (6.7% in Q2 2008)
- Nokia operating cash flow of EUR 716 million.
- Total cash and other liquid assets of EUR 7.0 billion at the end of
Q2 2009.
OLLI-PEKKA KALLASVUO, NOKIA CEO:
"Nokia put in a solid performance in what was another tough quarter.
We increased our share of the global mobile device market
sequentially to an estimated 38% and grew our smartphone market share
to an estimated 41%. As a result of strong operational execution,
underlying operating margins improved sequentially in all segments.
Competition remains intense, but demand in the overall mobile device
market appears to be bottoming out. As before, we are continuing to
tightly manage our operating expenses.
We are balancing short-term priorities with our longer-term growth
ambitions as elements of the mobile handset, PC, internet and media
industries converge to form a new industry. Consumers will
increasingly expect devices and services designed as integrated
solutions. To capture this opportunity we are accelerating our
strategic transformation into a solutions company."
INDUSTRY AND NOKIA OUTLOOK
- Nokia expects industry mobile device volumes in the third quarter
2009 to be at approximately the same level or up slightly
sequentially.
- Nokia expects its mobile device market share in the third quarter
2009 to be approximately at the same level sequentially.
- Nokia continues to expect 2009 industry mobile device volumes to
decline approximately 10% from 2008 levels.
- Nokia now expects its market share in mobile devices to be
approximately flat in 2009, compared with 2008. This is an update to
Nokia's earlier target to increase its market share in mobile devices
in 2009.
- Nokia now expects its non-IFRS operating margin in Devices &
Services in the second half 2009 to be at approximately the same
level as in the first half 2009. This is an update to Nokia's earlier
target for the non-IFRS operating margin in Devices & Services to be
in the teens for the second half 2009.
- Nokia and Nokia Siemens Networks continue to expect the mobile
infrastructure and fixed infrastructure and related services market
to decline approximately 10% in Euro terms in 2009, from 2008 levels.
- Nokia and Nokia Siemens Networks now expect Nokia Siemens Networks
market share to decline moderately in 2009, compared to 2008, with a
strong performance in its Services business unit expected to be
offset by declines in certain product businesses. This is an update
to Nokia and Nokia Siemens Networks earlier target for Nokia Siemens
Networks market share to remain constant in 2009, compared to 2008.
SECOND QUARTER 2009 FINANCIAL HIGHLIGHTS
(Comparisons are given to the second quarter 2008, unless otherwise
indicated.)
The non-IFRS results exclusions
Q2 2009 - EUR 348 million (net) consisting of:
- EUR 22 million of impairment of intangible assets in Devices &
Services
- EUR 83 million restructuring charge in Devices & Services
- EUR 68 million gain on sale of security appliance business in
Devices & Services
- EUR 69 million restructuring charge and other one-time items in
Nokia Siemens Networks
- EUR 121 million of intangible assets amortization and other
purchase price related items arising from the formation of Nokia
Siemens Networks
- EUR 119 million of intangible assets amortization and other
purchase price related items arising from the acquisition of NAVTEQ
- EUR 2 million of intangible assets amortization and other purchase
price related items arising from the acquisition of OZ Communications
in Devices & Services
Q1 2009 - EUR 459 million consisting of:
- EUR 34 million of impairment of intangible assets in Devices &
Services
- EUR 59 million restructuring charge in Devices & Services
- EUR 123 million restructuring charge and other one-time items in
Nokia Siemens Networks
- EUR 116 million of intangible assets amortization and other
purchase price related items arising from the formation of Nokia
Siemens Networks
- EUR 125 million of intangible assets amortization and other
purchase price related items arising from the acquisition of NAVTEQ
- EUR 2 million of intangible assets amortization and other purchase
price related items arising from the acquisition of OZ Communications
in Devices & Services
Q2 2008 - EUR 580 million consisting of:
- EUR 259 million of charges related to closure of the Bochum site in
Germany in Devices & Services
- EUR 201 million restructuring charge and other one-time items in
Nokia Siemens Networks
- EUR 120 million of intangible assets amortization and other
purchase price related items arising from the formation of Nokia
Siemens Networks
Non-IFRS results exclude special items for all periods. In addition,
non-IFRS results exclude intangible asset amortization, other
purchase price accounting related items and inventory value
adjustments arising from i) the formation of Nokia Siemens Networks
and ii) all business acquisitions completed after June 30, 2008.
Nokia Group
Nokia's second quarter 2009 net sales decreased 25% to EUR 9.9
billion, compared with EUR 13.2 billion in the second quarter 2008.
At constant currency, Group net sales would have decreased 24% year
on year and increased 7% sequentially.
The following chart sets out the year on year and sequential growth
rates in our net sales on a reported basis and at constant currency
for the periods indicated.
+-------------------------------------------------------------------+
| NOKIA SECOND QUARTER 2009 NET SALES |
|-------------------------------------------------------------------|
| Reported & Constant Currency1 |
|-------------------------------------------------------------------|
| | Q2/2009 | Q2/2009 |
| | vs. | vs. |
|-------------------------------------| Q2/2008 | Q1/2009 |
| | Change | Change |
|-------------------------------------+--------------+--------------|
| | | |
|-------------------------------------+--------------+--------------|
| Group net sales - reported | -25% | 7% |
|-------------------------------------+--------------+--------------|
| Group net sales - constant | | |
| currency1 | -24% | 7% |
|-------------------------------------+--------------+--------------|
| | | |
|-------------------------------------+--------------+--------------|
| Devices & Services net sales - | | |
| reported | -28% | 7% |
|-------------------------------------+--------------+--------------|
| Devices & Services net sales - | | |
| constant currency1 | -28% | 7% |
|-------------------------------------+--------------+--------------|
| | | |
|-------------------------------------+--------------+--------------|
| Nokia Siemens Networks net sales - | | |
| reported | -21% | 7% |
|-------------------------------------+--------------+--------------|
| Nokia Siemens Networks net sales - | | |
| constant currency1 | -20% | 8% |
|-------------------------------------+--------------+--------------|
| | | |
|-------------------------------------------------------------------|
| Note 1: Change in net sales at constant currency excludes the |
| impact of changes in exchange rates in comparison to the Euro, |
| our reporting currency. |
+-------------------------------------------------------------------+
Nokia's second quarter 2009 reported operating profit decreased 71%
to EUR 427 million, compared with EUR 1.5 billion in the second
quarter 2008. Nokia's second quarter 2009 non-IFRS operating profit
decreased 62% to EUR 775 million, compared with EUR 2.1 billion in
the second quarter 2008. Nokia's second quarter 2009 reported
operating margin was 4.3% (11.2%). Nokia's second quarter 2009
non-IFRS operating margin was 7.8% (15.6%).
Operating cash flow for the second quarter 2009 was EUR 716 million.
Operating cash flow for the second quarter 2008 was EUR 1.5 billion.
Total cash and other liquid assets were EUR 7.0 billion at June 30,
2009, compared with EUR 8.0 billion at June 30, 2008. At June 30,
2009, Nokia's net debt-equity ratio (gearing) was -10%, compared with
-47% at June 30, 2008.
Devices & Services
In the second quarter 2009, the total mobile device volumes of our
Devices & Services group were 103.2 million units, representing a
decline of 15% year on year and an 11% increase sequentially. The
overall industry mobile device volumes for the same period were 268
million units based on Nokia's preliminary estimate, representing a
12% year on year decrease and a 5% sequential increase. The lower
device volumes year on year for Nokia and the industry continued to
be driven by the negative impact of the deteriorated global economic
conditions, including weaker consumer and corporate spending,
constrained credit availability and currency market volatility. The
sequential industry device volume increase primarily reflected
seasonality in the second quarter. Nokia volumes also benefited
sequentially from a more stable inventory situation in the operator
and distributor channels. Nokia's mobile device market share was an
estimated 38% in the second quarter 2009, down from 40% in the second
quarter 2008 and up from 37% in the first quarter 2009.
Of the total industry mobile device volumes, converged mobile device
industry volumes in the second quarter 2009 increased to 41.0 million
units, based on Nokia's preliminary estimate, compared with an
estimated 37.1 million units in the second quarter 2008, and 36.0
million units in the first quarter 2009. Our own converged mobile
device volumes were 16.9 million units in the second quarter 2009,
compared with 15.3 million units in the second quarter 2008 and 13.7
million units in the first quarter 2009. Nokia's share of the
converged device market was an estimated 41% in the second quarter
2009, unchanged from 41% in the second quarter 2008 and up from 39%
in the first quarter 2009. We shipped 4.6 million Nokia Nseries and
4.7 million Nokia Eseries devices during the second quarter 2009, up
from the combined 8.2 million Nseries and Eseries devices we shipped
in the first quarter 2009.
The following chart sets out our mobile device volumes for the
periods indicated, as well as the year on year and sequential growth
rates, by geographic area.
+-------------------------------------------------------------------+
| NOKIA MOBILE DEVICE VOLUME BY GEOGRAPHIC AREA |
|-------------------------------------------------------------------|
| | | | YoY | | QoQ |
| (million units) | Q2/2009 | Q2/2008 | Change | Q1/2009 | Change |
|-------------------+---------+---------+--------+---------+--------|
| Europe | 23.3 | 27.1 | -14.0% | 22.3 | 4.5% |
|-------------------+---------+---------+--------+---------+--------|
| Middle East & | | | | | |
| Africa | 18.9 | 21.1 | -10.4% | 14.8 | 27.7% |
|-------------------+---------+---------+--------+---------+--------|
| Greater China | 18.6 | 17.6 | 5.7% | 17.9 | 3.9% |
|-------------------+---------+---------+--------+---------+--------|
| Asia-Pacific | 30.3 | 36.4 | -16.8% | 28.2 | 7.4% |
|-------------------+---------+---------+--------+---------+--------|
| North America | 3.2 | 4.5 | -28.9% | 3.4 | -5.9% |
|-------------------+---------+---------+--------+---------+--------|
| Latin America | 8.9 | 15.3 | -41.8% | 6.6 | 34.8% |
|-------------------+---------+---------+--------+---------+--------|
| Total | 103.2 | 122.0 | -15.4% | 93.2 | 10.7% |
+-------------------------------------------------------------------+
Based on our preliminary market estimate, Nokia's mobile device
market share for the second quarter 2009 was 38%, compared with 40%
in the second quarter 2008 and 37% in the first quarter 2009. Our
year on year market share decline was driven primarily by lower
market share in Latin America, Asia-Pacific and North America. This
was partially offset by a slightly higher market share in Greater
China, Europe and Middle East & Africa. Sequentially, our market
share declined in North America, but this decline was more than
offset by our increased market share in Middle East & Africa, Greater
China, Europe, Asia-Pacific and Latin America.
Our mobile device average selling price (ASP) in the second quarter
2009 was EUR 62, down from EUR 74 in the second quarter 2008 and EUR
65 in the first quarter 2009. Both the year on year and sequential
ASP declines were primarily due to general price pressure and a
higher proportion of sales of lower priced products. Our second
quarter 2009 ASP benefited from sales of new high-end products,
compared to the first quarter 2009.
Second quarter 2009 Devices & Services net sales declined 28% to EUR
6.6 billion, compared with EUR 9.1 billion in the second quarter
2008. Devices & Services net sales were down year on year in all
geographic areas. At constant currency, Devices & Services net sales
would have decreased 28%. The net sales decline resulted primarily
from lower volumes, combined with the ASP decline, compared with the
second quarter 2008. Of our total Devices & Services net sales,
services contributed EUR 140 million in the second quarter 2009,
representing 18% year on year growth and a 7% sequential decrease.
Nokia completed the divestment of its security appliances business in
April 2009 and accordingly services net sales for periods from April
1, 2009 are not directly comparable to services net sales of any
prior periods.
Devices & Services reported gross profit and non-IFRS gross profit
decreased 32% to EUR 2.2 billion, compared with EUR 3.3 billion in
the second quarter 2008, with a reported and non-IFRS gross margin of
34.0% (36.1%). The year on year gross margin decrease was primarily
due to a higher proportion of sales of lower end, lower margin
devices and a lower proportion of sales of new high-end, higher
margin devices, as well as general price pressure.
Devices & Services reported operating profit decreased 51% to EUR 763
million, compared with EUR 1.6 billion in the second quarter 2008,
with a reported operating margin of 11.6% (17.2%). Devices & Services
non-IFRS operating profit decreased 56% to EUR 802 million, compared
with EUR 1.8 billion in the second quarter 2008, with a non-IFRS
operating margin of 12.2% (20.1%). The 56% year on year decrease in
non-IFRS operating profit for the second quarter 2009 was due
primarily to lower net sales compared with the second quarter 2008.
The impact of lower net sales was somewhat mitigated by a reduction
in our cost of sales and operating expenses during the second quarter
2009.
NAVTEQ
(Comparisons are given to the first quarter 2009)
Second quarter 2009 NAVTEQ net sales increased 11% sequentially to
EUR 147 million, compared with EUR 132 million in the first quarter
2009, reflecting a slight pick-up in demand for auto navigation
systems. NAVTEQ reported gross profit was EUR 126 million (EUR 116
million), with a gross margin of 85.7% (87.5%). Non-IFRS gross profit
was EUR 127 million (EUR 117 million), with a non-IFRS gross margin
of 85.8% (87.3%). NAVTEQ had a reported operating loss of EUR 100
million (EUR 120 million loss). The reported operating margin was
-68.0% (-90.9%). NAVTEQ non-IFRS operating profit was EUR 19 million
(EUR 5 million), with a non-IFRS operating margin of 12.8% (3.7%).
Nokia Siemens Networks
Second quarter 2009 net sales decreased 21% to EUR 3.2 billion,
compared with EUR 4.1 billion in the second quarter 2008, reflecting
challenging market conditions and competitive factors. At constant
currency, Nokia Siemens Networks net sales would have decreased 20%.
The following chart sets out Nokia Siemens Networks net sales for the
periods indicated, as well as the year on year and sequential growth
rates, by geographic area.
+-------------------------------------------------------------------+
| NOKIA SIEMENS NETWORKS NET SALES BY GEOGRAPHIC AREA |
| |
|-------------------------------------------------------------------|
| | | | YoY | | QoQ |
| EUR million | Q2/2009 | Q2/2008 | Change | Q1/2009 | Change |
|-------------------+---------+---------+--------+---------+--------|
| Europe | 1 209 | 1 412 | -14.4% | 1 097 | 10.2% |
|-------------------+---------+---------+--------+---------+--------|
| Middle East & | | | | | |
| Africa | 459 | 553 | -17.0% | 436 | 5.3% |
|-------------------+---------+---------+--------+---------+--------|
| Greater China | 353 | 413 | -14.5% | 284 | 24.3% |
|-------------------+---------+---------+--------+---------+--------|
| Asia-Pacific | 648 | 1 076 | -39.8% | 692 | -6.4% |
|-------------------+---------+---------+--------+---------+--------|
| North America | 208 | 158 | 31.6% | 169 | 23.1% |
|-------------------+---------+---------+--------+---------+--------|
| Latin America | 322 | 455 | -29.2% | 312 | 3.2% |
|-------------------+---------+---------+--------+---------+--------|
| Total | 3 199 | 4 067 | -21.3% | 2 990 | 7.0% |
+-------------------------------------------------------------------+
Nokia Siemens Networks reported gross profit decreased 25% to EUR 860
million, compared with EUR 1.1 billion in the second quarter 2008,
with a gross margin of 26.9% (28.2%). Nokia Siemens Networks non-IFRS
gross profit decreased 30% to EUR 897 million, compared with EUR 1.3
billion in the second quarter 2008, with a non-IFRS gross margin of
28.0% (31.5%). The lower year on year non-IFRS gross profit in the
second quarter 2009 was due primarily to lower year on year net
sales.
Nokia Siemens Networks had a second quarter 2009 reported operating
loss of EUR 188 million compared with an operating loss of EUR 47
million in the second quarter 2008, with an operating margin of -5.9%
(-1.2%). Nokia Siemens Networks non-IFRS operating profit was EUR 2
million in the second quarter 2009, compared with a non-IFRS
operating profit of EUR 274 million in the second quarter 2008, with
a non-IFRS operating margin of 0.1% (6.7%). The year on year decline
in Nokia Siemens Networks non-IFRS operating profit primarily
reflected lower net sales.
Q2 2009 OPERATING HIGHLIGHTS
Devices & Services
- Nokia continued to take action to adjust its business operations
and cost base in accordance with market demand as well as seek
savings in operational expenses, looking at all areas and activities
across Devices & Services and global support functions:
- Nokia announced plans to streamline its Services organization,
including measures that are targeted to open up greater opportunities
for third party partner services. Approximately 450 employees
globally are affected by the plans.
- Nokia announced plans to improve cost-efficiency in logistics,
production management and production support operations, with
approximately 170 employees globally affected.
- Nokia announced a targeted voluntary resignation package for up to
320 employees at its mobile device manufacturing facility in Salo,
Finland. The scheme was fully subscribed.
- Nokia commenced shipments of the Nokia N97, its flagship smartphone
and the first device to ship with the integrated Ovi Store, a
one-stop-shop for applications and content for millions of Nokia
device users and another critical element of our evolving Ovi
internet services offering. Ovi Store launched in late May and by the
end of the quarter it had attracted downloads from people in more
than 180 countries.
- In the area of music, Nokia benefited from the continued strong
performance by the Nokia 5800 XpressMusic, its first mass market
touch product, which shipped 3.7 million units during the quarter.
More than 6.8 million units have shipped since the device began
shipping in late November last year. During the second quarter, Nokia
further strengthened its offering of devices optimized for music,
announcing the Nokia 5530 XpressMusic, a compact touch-screen device.
Nokia also extended its Comes With Music service - an
'all-you-can-eat' music offer where users can download freely
millions of tracks for a pre-defined period of time and keep those
tracks once the period is up - to Brazil, Germany, Italy, Mexico,
Sweden and Switzerland. Additionally, Nokia extended Nokia Music
Store, with the chain of digital music stores now covering 21
countries in total.
- Nokia Messaging, Nokia's consumer email service, continued to gain
traction among operators with six new agreements announced in the
second quarter. By the end of the quarter, Nokia Messaging was
available to Nokia users in more than 40 countries. Additionally, by
the end of the quarter, approximately 600 000 people had activated an
Ovi Mail account. Ovi Mail is an email solution developed especially
for consumers in emerging markets.
- Nokia started shipments of the Nokia E75, its flagship email
device, and the Nokia N86 8MP, its flagship imaging device. Nokia
also announced the Nokia E72, its latest full QWERTY smartphone and
the successor to the highly popular Nokia E71. Cumulative shipments
of the Nokia E71 reached 5 million during the quarter.
- Nokia made Nokia Life Tools commercially available across India.
Nokia Life Tools is an innovative offering of agriculture
information, education and entertainment services targeted at
non-urban consumers in emerging markets. Nokia Life Tools is
available on the new Nokia 2330 classic and the Nokia 2323 classic,
and will also be made available on other enabled devices.
- Nokia announced the Nokia 6216 classic, its first SIM-based Near
Field Communication (NFC) device which enables operators to build NFC
services on to the SIM card.
- Nokia commenced shipments of its first 3G mobile device in Korea.
The 6210s is a competitively priced smartphone with a slide form
factor and is available through local operator KTF.
- Nokia expanded its network of research laboratories with the
opening of Nokia Research Center, Berkeley, in California in the
United States.
- Nokia and Intel Corporation announced that they will work together
to develop a new class of Intel® Architecture-based mobile computing
device and chipset architectures that will combine the performance of
powerful computers with high-bandwidth mobile broadband
communications and ubiquitous Internet connectivity. The two
companies share a vision of a new class of standards-based mobile
computing platforms that provide an always-on, always-connected
experience and offer the performance to deliver PC-like Internet
experiences across a new class of services.
NAVTEQ
- NAVTEQ announced the availability of dynamic content delivery for
HD Radio(TM) systems in North America, accelerating the delivery of
content including traffic, weather and fuel prices.
- NAVTEQ launched NAVTEQ LocationPoint(TM), a location-based
advertising service for mobile devices, in several European
countries.
- NAVTEQ announced the availability of Motorway Junction Objects,
which enables navigation systems to display full 3D animation of
complex junctions, in Australia with expansion planned to include the
United States and Europe.
- NAVTEQ announced a contract extension with MSN® Direct for NAVTEQ
Traffic(TM), supporting Microsoft's Live Search Maps web-based
service and as part of the MSN Direct connected services bundle.
- NAVTEQ announced that it has signed an agreement with Samsung
Electronics providing access to all countries in the NAVTEQ database
as well as NAVTEQ's Visual Content, Speed Limits, Extended Lanes and
NAVTEQ Discover Cities(TM).
Nokia Siemens Networks
- In June, Nokia Siemens Networks reached an agreement to acquire
CDMA and LTE assets from Nortel in a USD 650 million transaction that
remains subject to the approvals of the relevant bankruptcy courts in
North America as well as customary closing conditions.
- Nokia Siemens Networks strengthened its capital structure with the
completion of a EUR 2 billion syndicated loan agreement with a group
of 21 international banks, in a transaction that was over-subscribed.
Nokia Siemens Networks also concluded an agreement with the European
Investment Bank for a EUR 250 million loan for the development of its
multimode Radio Access network technology.
- Nokia Siemens Networks was awarded a EUR 1.1 billion, five-year
managed services deal by Oi, a major Brazilian operator and one of
the largest in Latin America. By the terms of the contract Nokia
Siemens Networks will be the sole provider of operations and
maintenance for all of Oi's Internal Plant Operations across 17
Brazilian states.
- Momentum in the services business continued with key services-led
customer wins with Telenor in Pakistan, DIGI Telecommunications in
Malaysia and a turnkey security solution for MTS in Russia that will
ensure safe internet browsing on GSM and 3G networks.
- Nokia Siemens Networks continued to facilitate its customers'
development of mobile broadband internet with significant wins
including a network modernization deal with M1 in Singapore, the
development of an HSPA+ capable network for Elisa in Finland, the
roll-out of Ireland's National Broadband Scheme using Wireless
Broadband with 3 and a successful trial of HSPA+ in a live 3G network
with Zain Saudi Arabia.
- Time Warner Cable selected Nokia Siemens Networks to supply and
build a fully integrated, 3GPP and PacketCable 2.0 compliant IMS (IP
Multimedia Subsystem) network, which will be the basis for providing
next generation consumer applications that will combine existing
voice, video and data services.
For more information on the operating highlights mentioned above,
please refer to related press announcements at the following links:
http://www.nokia.com/press,
http://www.navteq.com/about/press.html,
http://www.nokiasiemensnetworks.com/press
NOKIA IN THE SECOND QUARTER 2009
(The following discussion is of Nokia's reported results. Comparisons
are given to the second quarter 2008 results, unless otherwise
indicated.)
On July 10, 2008, Nokia completed the acquisition of NAVTEQ
Corporation. NAVTEQ is a separate reportable segment of Nokia
starting from the third quarter 2008. Accordingly, the results of
NAVTEQ are not available for the prior periods.
Nokia's net sales decreased 25% to EUR 9 912 million (EUR 13 151
million). Net sales of Devices & Services decreased 28% to EUR 6 586
million (EUR 9 090 million). Net sales of NAVTEQ were EUR 147
million. Net sales of Nokia Siemens Networks decreased 21% to EUR 3
199 million (EUR 4 067 million).
Operating profit decreased 71% to EUR 427 million (EUR 1 474
million), representing an operating margin of 4.3% (11.2%). Operating
profit in Devices & Services decreased 51% to EUR 763 million (EUR 1
565 million), representing an operating margin of 11.6% (17.2%).
Operating loss in NAVTEQ was EUR 100 million, representing an
operating margin of -68.0%. Operating loss in Nokia Siemens Networks
was EUR 188 million (loss of EUR 47 million), representing an
operating margin of -5.9% (-1.2%). Corporate Common Functions
reported expense totaled EUR 48 million (EUR 44 million).
In the second quarter 2009, net financial expense was EUR 61 million
(net financial income EUR 3 million). Profit before tax was EUR 380
million (EUR 1 477 million). Profit was EUR 287 million (EUR 1 083
million), based on a profit of EUR 380 million (EUR 1 103 million)
attributable to equity holders of the parent and a negative EUR 93
million (negative EUR 20 million) attributable to minority interests.
Earnings per share decreased to EUR 0.10 (basic) and EUR 0.10
(diluted), compared with EUR 0.29 (basic) and EUR 0.29 (diluted) in
the second quarter of 2008.
NOKIA IN JANUARY - JUNE 2009
(The following discussion is of Nokia's reported results. Comparisons
are given to the January-June 2008 results, unless otherwise
indicated.)
On July 10, 2008, Nokia completed the acquisition of NAVTEQ
Corporation. NAVTEQ is a separate reportable segment of Nokia
starting from the third quarter 2008. Accordingly, the results of
NAVTEQ are not available for the prior periods.
Nokia's net sales decreased 26% to EUR 19 186 million (EUR 25 811
million). Net sales of Devices & Services decreased 30% to EUR 12 759
million (EUR 18 353 million). Net sales of NAVTEQ were EUR 279
million. Net sales of Nokia Siemens Networks decreased 17% to EUR 6
189 million (EUR 7 468 million).
Operating profit decreased 84% to EUR 482 million (EUR 3 005
million), representing an operating margin of 2.5% (11.6%). Operating
profit in Devices & Services decreased 62% to EUR 1 310 million (EUR
3 448 million), representing an operating margin of 10.3% (18.8%).
Operating loss in NAVTEQ was EUR 220 million, representing an
operating margin of -78.9%. Operating loss in Nokia Siemens Networks
was EUR 549 million (loss of EUR 121 million), representing an
operating margin of -8.9% (-1.6%). Corporate Common Functions
reported expense totaled EUR 59 million (EUR 322 million).
In the period from January to June 2009, net financial expense was
EUR 138 million (net financial income EUR 71 million). Profit before
tax was EUR 368 million (EUR 3 084 million). Profit was EUR 291
million (EUR 2 283 million), based on a profit of EUR 502 million
(EUR 2 325 million) attributable to equity holders of the parent and
a negative EUR 211 million (negative EUR 42 million) attributable to
minority interests. Earnings per share decreased to EUR 0.14 (basic)
and EUR 0.13 (diluted), compared with EUR 0.61 (basic) and EUR 0.61
(diluted) in January-June 2008.
PERSONNEL
The average number of employees during January-June 2009 was 123 274,
of which the average number of employees at Nokia Siemens Networks
was 60 686. At June 30, 2009, Nokia employed a total of 120 827
people (117 212 at June 30, 2008), of which 60 983 were employed by
Nokia Siemens Networks (60 039 people at June 30, 2008).
SHARES
The total number of Nokia shares at June 30, 2009 was 3 744 948 552.
At June 30, 2009, Nokia and its subsidiary companies owned 37 520 159
Nokia shares, representing approximately 1.0% of the total number of
Nokia shares and the total voting rights.
The complete press release with tables is available at:
http://www.nokia.com/results/Nokia_results2009Q2e.pdf
FORWARD-LOOKING STATEMENTS
It should be noted that certain statements herein which are not
historical facts, including, without limitation, those regarding: A)
the timing of product, services and solution deliveries; B) our
ability to develop, implement and commercialize new products,
services, solutions and technologies; C) our ability to develop and
grow our consumer Internet services business; D) expectations
regarding market developments and structural changes; E) expectations
regarding our mobile device volumes, market share, prices and
margins; F) expectations and targets for our results of operations;
G) the outcome of pending and threatened litigation; H) expectations
regarding the successful completion of contemplated acquisitions on a
timely basis and our ability to achieve the set targets upon the
completion of such acquisitions; and I) statements preceded by
"believe," "expect," "anticipate," "foresee," "target," "estimate,"
"designed," "plans," "will" or similar expressions are
forward-looking statements. These statements are based on
management's best assumptions and beliefs in light of the information
currently available to it. Because they involve risks and
uncertainties, actual results may differ materially from the results
that we currently expect. Factors that could cause these differences
include, but are not limited to: 1) the deteriorating global economic
conditions and related financial crisis and their impact on us, our
customers and end-users of our products, services and solutions, our
suppliers and collaborative partners; 2) the development of the
mobile and fixed communications industry, as well as the growth and
profitability of the new market segments that we target and our
ability to successfully develop or acquire and market products,
services and solutions in those segments; 3) the intensity of
competition in the mobile and fixed communications industry and our
ability to maintain or improve our market position or respond
successfully to changes in the competitive landscape; 4)
competitiveness of our product, services and solutions portfolio; 5)
our ability to successfully manage costs; 6) exchange rate
fluctuations, including, in particular, fluctuations between the
euro, which is our reporting currency, and the US dollar, the
Japanese yen, the Chinese yuan and the UK pound sterling, as well as
certain other currencies; 7) the success, financial condition and
performance of our suppliers, collaboration partners and customers;
8) our ability to source sufficient amounts of fully functional
components, sub-assemblies, software and content without interruption
and at acceptable prices; 9) the impact of changes in technology and
our ability to develop or otherwise acquire and timely and
successfully commercialize complex technologies as required by the
market; 10) the occurrence of any actual or even alleged defects or
other quality, safety or security issues in our products, services
and solutions; 11) the impact of changes in government policies,
trade policies, laws or regulations or political turmoil in countries
where we do business; 12) our success in collaboration arrangements
with others relating to development of technologies or new products,
services and solutions; 13) our ability to manage efficiently our
manufacturing and logistics, as well as to ensure the quality,
safety, security and timely delivery of our products, services and
solutions; 14) inventory management risks resulting from shifts in
market demand; 15) our ability to protect the complex technologies,
which we or others develop or that we license, from claims that we
have infringed third parties' intellectual property rights, as well
as our unrestricted use on commercially acceptable terms of certain
technologies in our products, services and solutions; 16) our ability
to protect numerous Nokia, NAVTEQ and Nokia Siemens Networks
patented, standardized or proprietary technologies from third-party
infringement or actions to invalidate the intellectual property
rights of these technologies; 17) any disruption to information
technology systems and networks that our operations rely on; 18)
developments under large, multi-year contracts or in relation to
major customers; 19) the management of our customer financing
exposure; 20) our ability to retain, motivate, develop and recruit
appropriately skilled employees; 21) whether, as a result of
investigations into alleged violations of law by some former
employees of Siemens AG ("Siemens"), government authorities or others
take further actions against Siemens and/or its employees that may
involve and affect the carrier-related assets and employees
transferred by Siemens to Nokia Siemens Networks, or there may be
undetected additional violations that may have occurred prior to the
transfer, or violations that may have occurred after the transfer, of
such assets and employees that could result in additional actions by
government authorities; 22) any impairment of Nokia Siemens Networks
customer relationships resulting from the ongoing government
investigations involving the Siemens carrier-related operations
transferred to Nokia Siemens Networks; 23) unfavorable outcome of
litigations; 24) allegations of possible health risks from
electromagnetic fields generated by base stations and mobile devices
and lawsuits related to them, regardless of merit; as well as the
risk factors specified on pages 11-28 of Nokia's annual report on
Form 20-F for the year ended December 31, 2008 under Item 3D. "Risk
Factors." Other unknown or unpredictable factors or underlying
assumptions subsequently proving to be incorrect could cause actual
results to differ materially from those in the forward-looking
statements. Nokia does not undertake any obligation to publicly
update or revise forward-looking statements, whether as a result of
new information, future events or otherwise, except to the extent
legally required.
Nokia, Helsinki - July 16, 2009
Media and Investor Contacts:
Corporate Communications, tel. +358 7180 34900
Investor Relations Europe, tel. +358 7180 34289
Investor Relations US, tel. +1 914 368 0555
- Nokia plans to publish its third quarter 2009 results on October
15, 2009.
www.nokia.com
--- End of Message ---
NOKIA
P.O. Box 226<br>FIN-00045 NOKIA GROUP Espoo
WKN: 870737;
ISIN: FI0009000681; Index: DJ STOXX Large 200, DJ STOXX 50;
Listed: Nordic list (Large Cap) in THE HELSINKI STOCK EXCHANGE;
Latest directors dealings
- 9 hours ago Close Brothers Group
- 9 hours ago Savannah Energy
- 10 hours ago Mid Wynd International Inv Trust
- 10 hours ago Dillistone Group
- 10 hours ago SSP Group