Nokia ends 2013 in decline

Financial news

Nokia ends 2013 in decline

Jennifer Scott

Nokia today released its fourth quarter results for 2013 showing declines across its continuing operations of Nokia Solutions and Networks (NSN), Here and Advanced Technologies.

Despite growing 18% from the previous quarter, net sales across the whole firm fell by 21% when compared with the fourth quarter of 2012, reaching just under €3.5bn instead of almost €4.5bn last year.

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Operating profit again saw a rise from the third quarter to the fourth – up by 5% to €274m – but this was a significant drop from last year’s figures, down by 17%.

NSN saw net sales drop by 22% year on year to just over €3.1bn, but compared with the third quarter of 2013 numbers were up by 20%. Operating profit also fell slightly, down from €252m last year to €243m for this quarter.

The Here division, which includes Nokia’s location and mapping services, saw net sales fall 9% from the third quarter of 2012 to hit €254m, but this was a rise of 20% from the previous quarter.

The Advanced Technology division for the CTO’s pet projects and patents saw losses across the board, with net sales falling 20% year on year and 14% quarter on quarter, reaching just €121m. Profits also fell by 35% compared with the fourth quarter of 2013 and 22% on the previous quarter to just €65m.

Nokia still reported the results for its devices and services business, which it announced it was selling to Microsoft in September 2013, as the deal was not agreed by the company’s board until late November.

Naming it in its financial reports as its “discontinued operations”, net sales fell by 29% to €2.6bn and even fell by 5% quarter on quarter, despite the Christmas season normally raising sales for mobile manufacturers. Operating profit was revealed as a €191m loss for the quarter, compared with a profit of €97m in the previous year.

However, despite these somewhat painful figures, Risto Siilasmaa, chairman and interim CEO of Nokia, was still positive about the prospects of its continuing operations following the “watershed moment” of the deal with Microsoft.

“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,” he said.

“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.”

Siilasmaa also promised to invest more in both Here and Advanced Technologies so the Nokia name can stay alive.

“For Here, we see long-term transformational growth opportunities in the automotive market, as well as in other industries,” he added. “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.

“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.”


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