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Nokia Post Q4 2013 Results With 8.2 Million Lumia Handsets Sold

January 23, 2014 2 Comments

Nokia’s 2013 Q4 results are in and those who belive that they would supercede previous quaters going into the new year would be wrong. It disheartens me to say that Nokia did’nt perfrom the best, but there are still many signs of life left and so this war is far from over. Nokia has gone on the record to say that it sold 8.2 million Lumia handsets which is a small dip compared to the 8.8 million sold in Q3. Check out some of the highlights of the results below:  

    • Nokia expects the sale of Devices and Services business to complete in Q1 2014.
    • In the fourth quarter 2013, HERE had sales of new vehicle licenses of 3.2 million units, compared to 2.4 million units in the fourth quarter 2012 and 2.6 million units in the third quarter 2013. On a year-on-year basis, unit sales to vehicle customers increased primarily due to higher vehicle sales and higher consumer uptake of invehicle navigation.
    • Nokia announced that Samsung extended a patent license agreement between Nokia and Samsung for 5 years. Samsung will pay compensation to Nokia for the period commencing from January 1, 2014. The amount to be paid by Samsung will be finally settled in a binding arbitration, which is expected to be concluded during 2015.
    • Nokia’s Extraordinary General Meeting held on November 19, 2013 confirmed and approved the sale of substantially all of Nokia’s Devices & Services business to Microsoft in line with the proposal and recommendation of the Nokia Board of Directors. More than 99 % of the votes cast at the Extraordinary General Meeting were in favor of this proposal.


Nokia’s net sales in Q4 2013 were EUR 3.5 billion, up 18% compared to Q3 2013
- In Q4 2013, underlying operating profitability for Nokia’s continuing operations increased to EUR 408 million or 11.7% of net sales, compared to EUR 344 million or 11.7% of net sales in Q3 2013.
- NSN achieved solid underlying operating profitability, with Q4 2013 non-IFRS operating margin of 11.2% compared to 8.4% in Q3 2013. This reflected strong gross margin and continued progress relative to its strategy in a seasonally strong quarter, partially offset by higher than normal non-IFRS other expenses.
- HERE’s external net sales grew to EUR 225 million, an increase of 10% year-on-year and 28% sequentially.
- Nokia announced that Samsung extended a patent license agreement between Nokia and Samsung for 5 years. Samsung will pay compensation to Nokia for the period commencing from January 1, 2014. The amount to be paid by Samsung will be finally settled in a binding arbitration, which is expected to be concluded during 2015.

Nokia’s full year net sales 2013 were EUR 12.7 billion, down 17% compared to full year 2012
- Despite NSN’s lower top line, underlying operating profitability improved to EUR 1.1 billion or 9.7% of net sales, compared to EUR 0.8 billion or 5.7% of net sales in 2012, reflecting strong gross margin and continued progress relative to its strategy.
- NSN achieved its target to reduce non-IFRS annualized operating expenses and production overheads by more than EUR 1.5 billion by the end of 2013, compared to the end of 2011.
- NSN reported net profit improved to EUR 15 million, compared to a reported net loss of EUR 1.4 billion in 2012, reflecting lower levels of restructuring charges, strong operational performance in both Global Services and Mobile Broadband, and lower purchase price accounting related expenses.

Balance sheet highlights:
- Nokia Group ended 2013 with a strong balance sheet and solid cash position with gross cash of EUR 9.0 billion and net cash of EUR 2.3 billion compared to EUR 9.1 billion and EUR 2.4 billion, respectively, at the end of Q3 2013. At the end of 2013, NSN’s contribution to Nokia Group gross and net cash was EUR 2.8 billion and EUR 1.7 billion, respectively, compared to EUR 2.7 billion and EUR 1.5 billion at the end of Q3 2013.

Additional information*:
- Nokia received shareholder approval for the sale of substantially all of its Devices & Services business at our Extraordinary General Meeting. As a result, Nokia has commenced reporting substantially all of its Devices & Services business as discontinued operations. In Q4 2013, discontinued operations net sales were EUR 2.6 billion and non-IFRS operating margin was -7.3%. Full year 2013 discontinued operations net sales were EUR 10.7 billion and non-IFRS operating margin was -4.8%. Within discontinued operations, we continue to focus on innovation as well as working capital efficiency and the overall cash flow performance.
- Nokia achieved its target to reduce its Devices & Services non-IFRS operating expenses to an annualized run rate of approximately EUR 3.0 billion by the end of 2013.

Risto Siilasmaa, Nokia Chairman and interim CEO commented on the company’s progress:
“The fourth quarter of 2013 was a watershed moment in Nokia’s history. Having received overwhelmingly strong support from our shareholders at our extraordinary general meeting in November for the sale of our phones business to Microsoft, we are diligently working towards defining Nokia’s future direction. I am pleased with the progress we have made thus far in our strategy evaluation and excited by the opportunities ahead for each of our three continuing businesses: NSN, HERE and Advanced Technologies.

During the fourth quarter, Nokia’s continuing businesses produced a healthy underlying operating margin of 12%. While the first quarter of the year is seasonally weak for our continuing operations, we continue to expect the closing of the Microsoft transaction to significantly improve Nokia’s earnings profile.

The strength of NSN’s underlying profitability highlights just how fundamentally different the company is today, compared with two years ago when it started its restructuring and transformation program. Today, we are more focused, more innovative and more disciplined. With these fundamental elements in place, we believe NSN is well-positioned to deliver solid business performance for the year ahead.

For HERE, we see long-term transformational growth opportunities in the automotive market, as well as in other industries.  Thus, we are planning to increase investment levels in 2014 to capture these exciting opportunities in the coming years.

For Advanced Technologies, we are focused on continuing to invest in innovation, implementing our successful business strategy of licensing our industry leading intellectual property to companies interested in Nokia’s innovations, and are planning to add further value to our partners through technology licensing.”

You can read more of the report by going HERE

Source: Nokia

MBGW

I am a ghostwriter..don't know what I do look it up.. I just so happen to have this WP8, so why not write about it? :-)

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  • Chris Wright

    Hi, where did they announce the figure of 8.3 million sales? Doesn’t appear in the written report.

    • MBGW

      Hello, The earning report doesn’t list it specifically because later in the day Nokia made the statement and it has since been reported by Engadget among others, where we should have sourced. It can been seen on their site here.

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