Ericsson Reports 1st Quarter 08 Results

Published Mon, 2008-04-28 13:53 Corporate Finance

The year-over-year sales increased by 5%. Growth was negatively affected by a continued weakened USD. Organic growth in constant currencies is estimated to 9% and acquisitions added 2%.

Gross margin amounted to 38.6% (43.0%) and declined year-over-year, mainly due to the business mix with a high proportion of new network buildouts. Sales of software and IPRs were slightly higher in the quarter.

Operating income amounted to SEK 4.3 (8.2) b. in the quarter. Operating expenses amounted to SEK 14.1 (11.8) b. in the quarter due to the impact of the acquired companies, including amortization of intangibles, and increased R&D investments, mainly in LTE, mobile platforms and IPTV. Sony Ericsson's pre-tax profit contributed SEK 0.9 (1.6) b. to Group operating income in the quarter.

Cash flow from operating activities reached SEK 4.7 (4.6) b. in the quarter. The cash flow includes a dividend from Sony Ericsson of SEK 2.2 b. In the first quarter 2007, Sony Ericsson made an advance payment equivalent to a dividend of SEK 3.5 b. The working capital was slightly up. Cash conversion for the quarter amounted to 83% (80%). Days sales outstanding have increased by eight days in the quarter.

Cash flow from investing activities was SEK 3.2 (-9.2) b. First quarter 2007 was impacted by acquisitions.

# 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)

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