Nokia Oyj — Earnings Release 2002

Apr 18, 2002

News Details

Ad-hoc | 18 April 2002 11:42

Nokia Corp english

Nokia exceeds 1Q profit targets on slightly lower sales Ad-hoc-announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– Nokia exceeds 1Q profit targets on slightly lower sales Better-than-expected profitability in mobile phones offsets challenging network environment First quarter 2002 compared with first quarter 2001: – Net sales decreased 12% to EUR 7 014 million (EUR 8 007 million in 1Q 2001) – Pro forma operating profit was EUR 1 286 million (EUR 1 440 million); operating margin was 18.3% (18.0%) – Pro forma adjustments EUR 52 million in goodwill amortization – Pro forma earnings per share (diluted) was EUR 0.19 (EUR 0.22) – Reported (IAS) net profit was EUR 863 million (EUR 975 million) and reported earnings per share (diluted) was EUR 0.18 (EUR 0.20) end of ad-hoc-announcement (c)DGAP 18.04.2002 Issuer’s information/explanatory remarks concerning this ad-hoc-announcement: JORMA OLLILA, CHAIRMAN AND CEO: The company put in a solid overall performance for the first quarter 2002, with mobile phone profitability exceeding all expectations. The strong bottom line in our mobile handset business continues to be driven by Nokia’s global leadership. Based on Nokia’s preliminary research for the first quarter 2002, we believe we have at least maintained our estimated 37% share of the overall mobile phone market, in line with our long-term 40% share target. Continuing challenges in the network infrastructure environment led to lower- than-expected 2G investments in China and Europe, and we were unable to meet our first-quarter Nokia Networks sales estimates. However, the operating margin at Nokia Networks was as forecast, thanks to streamlining measures taken last year in this business. The transition to 3G is expected to positively impact sales in our networks business as we go into the second half of the year, and we believe we are on track to achieving our 35% targeted share of the overall mobile infrastructure market in the long-term. This is a year of renewal for our industry. Key enablers for new products and services are in place but at different stages of maturity and market penetration. We see multimedia messaging as the main driver in the current technology shift, with the majority of mobile devices in our product plan for next year being MMS-enabled. Nokia is working actively for industry renewal with a continuous flow of new products supporting a range of technologies. In the first half of this year alone, we plan to ship more models than in the whole of 2001, driving new mobile applications and services. This year will also mark the start of 3G, another key component of industry renewal, with the transition from 2G to 3G likely to span several years. We are preparing for the launch of our first 3G mobile device in the third quarter and are committed to having the very first Nokia-delivered 3G network in operation during September 2002. Over the next few years, mobility will be the major technology and lifestyle driver. A large part of personal and professional communications will be in a wireless environment with a personal mobile device as the medium. Given Nokia’s solid financials, clear market leadership and long record of success in the realm of mobility, we continue to anticipate far-reaching growth opportunities as this industry unfolds. It should be noted that certain statements herein which are not historical facts, including, without limitation those regarding A) the timing of product deliveries; B) our ability to develop and implement new products and technologies; C) expectations regarding market growth and developments; D) expectations for growth and profitability; and E) statements preceded by “believe,” “expect,” “anticipate,” “foresee” or similar expressions, are foreward-looking statements. Because these statements 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) developments in the mobile communications market including the continued development of the replacement market and the Company’s success in the 3G market; 2) demand for products and services; 3) market acceptance of new products and service introductions; 4) the availability of new products and services by operators; 5) weakened economic conditions in many of the Company’s principal markets; 6) pricing pressures; 7) intensity of competition; 8) the impact of changes in technology; 9) consolidation or other structural changes in the mobile communications market; 10) the success and financial condition of the Company’s partners, suppliers and customers; 11) the management of the Company’s customer financing exposure; 12) the continued success of product development by the Company; 13) the continued success of cost-efficient, effective and flexible manufacturing by the Company; 14) the ability of the Company to source component production and R&D without interruption and at acceptable prices; 15) inventory management risks resulting from shifts in market demand; 16) fluctuations in exchange rates, including, in particular, the fluctuations in the euro exchange rate between the US dollar and the Japanese yen; 17) impact of changes in government policies, laws or regulations; 18) the risk factors specified on pages 10 to 16 of the Company’s Form 20-F for the year ended December 31, 2000. NOKIA Helsinki, April 18, 2002 For more information: Lauri Kivinen, Corporate Communications, tel. +358 7180 34495 Ulla James, Investor Relations, tel. +1 972 894 4880 Antti Räikkönen, Investor Relations, tel. +358 7180 34290 http://www.nokia.com – Nokia plans a mid-quarter update on June 11, 2002. – Results announcements for 2Q and 3Q, 2002 are planned for July 18 and October 17, respectively. ——————————————————————————– WKN: 870737; ISIN: FI0009000681; Index: Listed: Amtlicher Handel in Frankfurt; Freiverkehr in Berlin, Bremen, Düsseldorf, Hamburg, Hannover, München, Stuttgart 181142 Apr 02