Nokia Oyj — Earnings Release 2002

Jan 23, 2003

News Details

Ad-hoc | 23 January 2003 12:06

Nokia Corp english

Nokia achieves excellent profitability and continued high cash flow in 4Q and 20 Ad-hoc-announcement transmitted by DGAP. The issuer is solely responsible for the content of this announcement. ——————————————————————————– Mobile phone volumes and market share reach highest ever levels Fourth quarter 2002 compared with fourth quarter 2001: – Net sales increased 1% to EUR 8 843 million (EUR 8 788 million in 4Q 2001) – Pro forma operating profit increased by 4% to EUR 1 655 million (EUR 1 589 million); pro forma operating margin was 18.7% (18.1%) – Pro forma adjustments for 4Q 2002 were EUR 189 million, consisting of: – Goodwill impairments of EUR 182 million – Goodwill amortization of EUR 48 million – Recovery of MobilCom receivables of EUR 41 million – Pro forma net profit increased by 8% to EUR 1 247 million (EUR 1 153 million) – Pro forma earnings per share (diluted) increased to EUR 0.26 (EUR 0.24) – Reported operating profit increased by 72% to EUR 1 466 million (EUR 853 million) – Reported net profit increased by 132% to EUR 1 046 million (EUR 450 million) and reported earnings per share (diluted) increased to EUR 0.22 (EUR 0.09) – Pro forma and Reported operating profit included a net gain of EUR 87 million from Nokia Venture Partners investments within Nokia Ventures Organization. Full year 2002 compared with full year 2001: – Net sales decreased 4% to EUR 30 016 million (EUR 31 191 million in 2001) – Pro forma operating profit increased by 3% to EUR 5 420 million (EUR 5 237 million); pro forma operating margin increased to 18.1% (16.8%) – Pro forma adjustments for 2002 were EUR 640 million (EUR 1 875 million) – Pro forma net profit increased by 4% to EUR 3 948 million (EUR 3 789 million) – Pro forma earnings per share (diluted) increased to EUR 0.82 (EUR 0.79) – Reported operating profit increased by 42% to EUR 4 780 million (EUR 3 362 million) – Reported net profit increased by 54% to EUR 3 381 million (EUR 2 200 million) and reported earnings per share (diluted) increased to EUR 0.71 (EUR 0.46) – At year-end, the net cash position increased to EUR 8.8 billion (EUR 5.1 billion) and the net debt-to-equity ratio (gearing) was -61% (-41%) end of ad-hoc-announcement (c)DGAP 23.01.2003 Issuer’s information/explanatory remarks concerning this ad-hoc-announcement: Nokia’s Board of Directors will propose a dividend of EUR 0.28 per share in respect of 2002. JORMA OLLILA, CHAIRMAN AND CEO During 2002, we again succeeded in translating our strong brand, product offering, industry-leading execution and operational efficiency into highly profitable results. While the world economy had an inevitable impact on Nokia’s topline growth, our overall profitability and market position were excellent and we ended the year with our highest ever net cash position of EUR 8.8 billion. In mobile phones, we saw record sales volumes of 46 million units in the fourth quarter and our highest ever market share, an estimated 39%, as well as continued high profitability. We also shipped a record number of 33 new products for the full year. In 2002, I was very pleased with the uptake of the Series 60 platform, which has fast become the leading platform for smart phones. As the mobile market moves further into this new phase of advanced features and services, driven by color screens, imaging, messaging and mobile games, we see Nokia at the forefront with its expanding product range and scope. Implementation of the new organizational structure in Nokia Mobile Phones has also been proceeding steadily throughout the year, bringing with it a fresh entrepreneurial spirit and commitment to growth. In the overall handset market for 2002, we were pleased to see a return to volume growth, with Nokia’s own share rising for the fifth consecutive year to an estimated 38% for the full year. We intend to make further market share gains during the current year. For the fourth quarter, Nokia Networks reached the relevant milestones for its dual-mode 3G systems. Furthermore, we were pleased to start operator shipments of our first WCDMA imaging phone, the Nokia 6650, while the first Nokia- delivered WCDMA network was successfully launched in Japan. This is clear evidence that the industry is moving on track towards early commercial WCDMA launches in the first half of 2003. The Open Mobile Alliance expanded far beyond all industry expectations from about 180 founding members in June to include more than 300 leading companies by the year end.This unprecedented commitment to openness is accelerating the mass-market take up of new data and value-added services for any device on any network. The strength of our full-year performance in a difficult environment speaks highly for the commitment of the whole Nokia team. My special thanks go to everyone at Nokia for their contribution and dedication during 2002. 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 forward-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 17 of the Company’s Form 20-F for the year ended December 31, 2001. NOKIA Helsinki – January 23, 2003 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 The complete press release with tables is available at: http://www.nokia.com/investor/2002/4Q/index.html ——————————————————————————– WKN: 870737; ISIN: FI0009000681; Index: Listed: Amtlicher Markt in Frankfurt; Freiverkehr in Berlin, Bremen, Düsseldorf, Hamburg, Hannover, München, Stuttgart 231206 Jän 03