Ericsson discloses the information provided herein pursuant to the Securities Markets Act and/or the Financial Instruments Trading Act. The information was submitted for publication at 07.30 CET, on April 25, 2008.]
Sales SEK 44.2 (42.2) b., organic growth in constant currencies 9%
Operating income SEK 4.3 (8.2) b., excl. restructuring charges of SEK 0.8 b.
Operating margin 9.7% (19.3%), excl. restructuring charges of SEK 0.8 b.
Cash flow SEK 4.7 (4.6) b., cash conversion 83% (80%)
Net income SEK 2.6 (5.8) b. 3), incl. restructuring charges of SEK 0.8 b.
Earnings per share SEK 0.17 (0.37) 3)
CEO COMMENTS
"Our business developed well in the quarter, considering the present market environment and the declining USD," said Carl-Henric Svanberg, President and CEO of Ericsson (NASDAQ:ERIC). "We still find it prudent to plan for a flattish mobile infrastructure market in 2008. The ongoing cost reductions as we adjust to such a scenario are running according to plan.
The sales development in the quarter reflects the demand for mobile infrastructure, especially in high-growth markets. Sales are picking up in the US while Western Europe remains slow. The proportion of new network builds in high-growth markets, especially in India, is increasing. In combination with a weaker USD, this continues to put pressure on our margins.
Professional Services continue to show good growth with increasing demands in all areas, especially in managed services and systems integration. In Multimedia, we continue to invest in R&D in new business opportunities which reduce profitability. Multimedia's result was also affected by Sony Ericsson's lower sales which impacted sales of mobile platforms.
The rollout of mobile broadband continues throughout the world. HSPA will be the dominant standard for many years and is now an effective alternative to fixed broadband. Mobile broadband will play a significant role in bridging the digital divide. Furthermore, it is encouraging that LTE, the evolution of HSPA, is supported by the largest operators around the world. We are investing significantly in this technology to secure leadership also in this area," said Carl-Henric Svanberg.
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