Tero, thanks for the insight. Here's some news from the Dow Jones wires:
"WRAP: Nokia Shrs Climb After 1Q Earnings Top Forecasts
By Jan Lindroth
STOCKHOLM (Dow Jones)--Nokia Oy (NOKA) topped expectations Friday when it published first-quarter earnings data, and the Finnish telecommunications group's stock climbed after dipping initially on profit-taking.
Nokia also announced several executive appointments, tapping Olli-Pekka Kallasvuo, head of its Americas operations, to serve as chief financial officer from Jan. 1, 1999.
The group raised pretax profit 59% on the year to 2.30 billion markkaa (FIM) ($1=FIM5.4480) in the quarter, beating analysts' average forecast for earnings of FIM2.23 billion, as sales climbed 31% to FIM14.87 billion. Sales grew strongly for both mobile handsets and mobile systems, Nokia said.
Nokia shares were SEK12, or 2.4%, higher on the day at SEK508 at 1440 GMT in Stockholm.
'The report looks very good, and they have probably taken some market share from Telefon AB LM Ericsson (ERICY) on the systems side at the same time as sales growth for mobile phones should be even better during the second quarter,' said Lauri Rosendal, analyst at brokerage firm Aros in Helsinki.
Mobile-handset sales rose 29% to FIM7.96 billion in the first quarter, while Nokia Telecommunications, which manufactures infrastructure for fixed and mobile networks, boosted sales 40% to FIM5.23 billion.
Nokia introduce several new mobile-phone models in the first quarter, but these came too late to have any significant impact on sales. However, Nokia Chief Executive Jorma Ollila said Friday in a conference call that mobile-phone sales growth accelerated late in the quarter.
'We'll see the impact from the new 6100 series in the second quarter, I believe,' said Henrik Soederberg, analyst at Swedish brokerage firm Hagstroemer & Qviberg.
Analysts seemed content with the first-quarter results after a somewhat disappointing fourth quarter in 1997, but cautioned that because Nokia shares have rocketed 75% higher already in 1998, further gains may be difficult despite a bright outlook.
'This will be a good year for Nokia, but the share performance has also been spectacular,' Hagstroemer's Soederberg said.
Ollila reiterated his positive outlook for 1998 in the earnings report, projecting continued strong growth, good profitability and positive operating cash flow.
As for the changes to its management structure, Nokia said Pekka Ala-Pietelae, now head of Nokia Mobile Phones, will assume the newly created position of executive vice president and deputy to Ollila.
'Clearly a crown price to Ollila is in the making here,' one analyst said.
Ala-Pietelae also will be responsible for a $100 million venture-capital fund announced Friday. The fund will buy into new start-up businesses and technologies, primarily in the U.S.
Matti Alahuhta, head of Nokia Telecommunications, will take over at Nokia Mobile Phones. Sari Baldauf, now responsible for the group's Asian operations, will head Nokia Telecommunications.
Nokia also said it plans to combine its multimedia network terminals and industrial electronics units into a single business area, to be known as communications products.
The group also said it had agreed to outsource its remaining multimedia production of digital decoders at Motala, Sweden, to U.S. electronics manufacturer SCI Systems Inc. (SCI) for an undisclosed sum. Nokia said about 450 staff will join SCI, which will purchase the related assets, and about 170 employees will remain with Nokia Multimedia Network Terminals in Sweden to continue in research and development, product marketing, sales and administration.
The group aid Nokia Telecommunications had agreed to outsource production of some fixed and radio-access products to SCI. Under the terms of the agreement, Nokia Telecommunications will transfer one Finland manufacturing site with about 300 employees to SCI.
-By Jan Lindroth; +46-8-411-8440 " |
