Research, Charts & Company Announcements
Research Tree provides access to ongoing research coverage, media content and regulatory news on NOKIA OYJ. We currently have 5 research reports from 1 professional analysts.
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Hope at last?
02 Feb 17
Nokia reported Q4 revenues of €6,715m, down 13% yoy at comparable as well as reported figures. The Ultra Broadband Networks segment went down by 14.7% yoy (€4,331m), with both sub-segments Mobile Networks (€3,787m, -13.6%) and Fixed Networks (€544m, -22.1%) being down; IP Networks and Applications came in at €1,737m, also down yoy (-12.1%), and leading the overall Networks business to be down by 14% yoy. Nokia Technologies displayed a massive decrease yoy (€309m, -25.2%) due to Q4 15 being boosted by the multi-year licensing agreement with Samsung. The non-IFRS gross margin came in at 42%, down 40bp yoy, for an IFRS gross margin of 40%. The adjusted EBIT margin came in at 14%, down 160bp yoy, for an IFRS EBIT margin of 4.8%, leading to an IFRS profit of €676m. For 2017, the company maintained a negative outlook for its addressable market, which is expected to decrease by 2.2%, as well as an operating margin of 8-10%; no guidance was provided for Nokia Technologies due to the current litigation with Apple. Capex is expected to be c. €500m.
Weak guidance in networks, but still better than Ericsson
27 Oct 16
Nokia reported Q3 revenues of €5,952m, down 6.9% yoy at comparable figures. The Ultra Broadband Networks segment went down by 12.7% yoy (€3,903m), due to a fall in Mobile Networks (€3,318m, -15%) partially offset by growth in the Fixed Networks business (€585m, +3.4% yoy); IP Networks and Applications came in at €1,420m, down yoy (-8.5%), while Nokia Technologies displayed a massive surge yoy (€353m, +108.9%) thanks to c. €100m of non-recurring sales related to the Samsung licensing agreement. The non-IFRS gross margin came in at 39.7%, up 200bp yoy, for an IFRS gross margin of 37.6%. The adjusted EBIT margin came in at 9.3%, down 140bp yoy, for an IFRS EBIT margin of 0.9%, leading to an IFRS loss of €139m. The company maintained its expectations of a decline in sales of its Networks business for 2016, although it specified that the cause was a decline in the overall addressable market. The net sales in this unit is expected to decline at the same pace as in Q3. The capex forecast has also been cut by €100m down to €550m. The nomination of Mr Kristian Pullola as new CFO was also announced, effective from 1 January 2017, as Mr Timo Ihamuotila will join ABB.
Even less growth, even more synergies: transition will last
04 Aug 16
Nokia reported Q1 revenues of €5,676m, down 10.8% yoy at comparable. Within the new reporting perimeter, the Ultra Broadband Networks segment went down by 11.5% yoy, due to a fall in Mobile Networks (€3,185m, -14.4%) partially offset by growth in the Fixed Networks business (€622m, +7.2% yoy); IP Networks and Applications came in at €1,421m, sharply down yoy (-10.8%), while Nokia Technologies declined yoy (€194m, -11.4%) but would have been up by 10% excluding the impact of non-recurring effects in Q2 15. The non-IFRS gross margin came in at 38.8%, down 60bp sequentially, for an IFRS gross margin of 36.3%. The adjusted EBIT margin came in at 5.8%, down 40bp sequentially, while the IFRS EBIT margin was a negative 13.6% with a loss of €790m, due to additional merger-related and restructuring costs. Non-IFRS net profit reached €171m, vs. an IFRS loss of €726m. The company maintained its expectations of a decline in sales of its Networks business for 2016, while the non-IFRS EBIT margin is now expected to be within a 7-9% range. The 2018 synergies objective is now set at €1.2bn vs. the previous mark of €900m.
Still difficult market conditions in wireless, which burden a solid execution
10 May 16
Nokia reported Q1 revenues of €5,603m, down 8.6% yoy at comparable. Within the new reporting perimeter, the Ultra Broadband Networks segment went down by 11.8% yoy, due to a fall in Mobile Networks (€3,116m, -15.5%) partially offset by growth in the Fixed Networks business (€613m, +13.3% yoy); IP Networks and Applications came in at €1,452m, slightly up yoy (+1.3%), while Nokia Technologies witnessed a sharp decline (€198m, -27.5%) due to strong non-recurring effects in Q1 15 which are now absent. The non-IFRS gross margin came in at 39.4%, up 250bp yoy, while the IFRS gross margin fell to 28.3% due to €651m of merger-related costs. The non-IFRS EBIT margin reached 6.2%, up 170bp yoy, while the IFRS EBIT margin was a negative 12.9% with a loss of €712m, due to additional merger-related costs. Non-IFRS net profit reached €139m, vs. an IFRS loss of €613m. The company expects a decline in sales of its Networks business for 2016, while the non-IFRS EBIT margin is expected to be above 7%. The 2018 synergies objective is now set above the €900m mark.
Licensing to offset networks, hampered by softening market conditions in Wireless
11 Feb 16
Nokia reported Q4 revenues of €3,609m, up 2.8% yoy at comparable perimeters but down 3% at constant exchange rates. Nokia Networks accounted for €3.20m, corresponding to a reported 4.6% decrease, while Nokia Technologies witnessed a 170% yoy increase thanks to the multi-year licensing agreement with Samsung. The IFRS gross margin came in at 46.4%, leading to a non-IFRS EBIT margin of 20.3%. The IFRS EBIT margin came in at 17.8%, up 590bp yoy thanks to the strong performance in Nokia Technologies (EBIT margin of 80.9%), boosted by the licensing agreement. Net profit reached €499m, for an EPS of €0.13 (€0.15 for the adjusted EPS). The company announced that the sale of HERE was successful, which translated into cash proceeds of €2.55bn. Concerning Alcatel, the company started combined operations in early January. The €900m of synergies are confirmed to be achieved in the full year 2018, while the €200m of annual interest expense reductions will be reached in 2016 instead of 2017. The exceptional dividend of €0.10 has been confirmed, while the normal dividend has been increased to €0.16. No guidance was provided for FY 2016, due to uncertainties caused by the acquisition of Alcatel. Q1 16 is expected to be impacted by headwinds in the wireless market, with a greater than normal seasonal decline.
The Slide Rule
12 Jan 17
What is The Slide Rule? The Slide Rule has been designed to dramatically simplify the identification of the best companies in the UK small/mid-cap sector by making a quantitative assessment of the relative potential of each company. At its core, The Slide Rule aims to identify those companies that create genuine shareholder value through strong returns on capital and solid growth, but also present a value opportunity with the potential tailwind of earnings momentum. Companies are assessed within a Quality, Value, Growth and Momentum (QVGM) framework.
Visible benefits from restructuring
23 Feb 17
In our view, Monitise’s H1 17 results demonstrate the benefits of management’s ongoing transformation programme. EBITDA profitability was sustained, and accompanied by cash outflow more than halving vs H1 16A. With gross cash at £27.3m, the group’s financial position remains strong. Initial FINkit sales are under “active discussion” and ongoing regulatory initiatives (CMA, PSD2) give further grounds for optimism in the outlook.
Small Cap Breakfast
16 Feb 17
Saffron Energy—Schedule One update. Raising £2.5m, expected Mkt Cap £7.7m. Admission due 24 Feb. Italian Oil & Gas Play Guinness Oil & Gas Exploration—Publication of prospectus. Seeking to raise £50m and invest in 15 exploration companies at launch, with plans to grow the portfolio to 30 positions during its lifetime. Issue closing 23 Feb. Arix Bioscience — Intention to float on the main market from the global healthcare and life science Company supporting medical innovation. Raised £52m in Feb 16 with investors including Woodford Investment Management
Ready to dominate TV distribution and prepared for new competition from Iliad
20 Feb 17
TI has released a good set of Q4 results: Revenues were up organically by 0.8% yoy (vs -5.2% in Q1, -4.2% in Q2 and -1.2% in Q3) while the EBITDA (excluding the negative impact of non-recurring items) has increased sharply by 5.9% yoy as in Q3 but vs a decline of 1.7% in H1! EBITDA has clearly benefited from the actions implemented in the “cost recovery plan” that started in Q2 in the Domestic Business and in Q3 in the Brazil Business. In Italy, revenues were up by 2.7% yoy (vs +1% in Q3 and -1.7% in the H1). The solid, structural recovery of Mobile revenues was confirmed, thanks both to the maintenance of market share and the stabilisation of ARPU levels. But the key point is the EBITDA which has grown by 8.4% (vs 7.9% in Q3, +6.9% in Q2 and -5.2% in Q1). Excluding non-recurring restructuring charges, EBITDA would have grown by +4.5% in 2016, with an EBITDA margin of 45.9%, up 1.9ppts on 2015. In Brazil, Q4 revenues were down organically and at constant change by only 1.7% yoy (vs -5.2% in Q3 and -14% in H1)! The main issue is that the total number of subscribers (c.63m with a market share of 26%) was still down by 4.3% vs end 2015. Note, however, that like its competitors the group has seen its prepaid customer base contract sharply in 2016, due to the adoption of a restrictive policy for the disconnection of inactive customers according to Anatel’s new criteria (the Brazilian National Telecommunications Agency). Q4 EBITDA was up by 2.8% yoy (vs +0.5% in Q3 and -10.9% in H1) with the start in Q3 of cost-cutting operations.
Ronez performing, debt facilities agreed
21 Feb 17
Confirming our view that Ronez is a high-quality maiden acquisition, SigmaRoc today announces that trading and operational performance at the verticallyintegrated aggregates business on the Channel Islands has been strong in the first few weeks of trading since the deal completed in early 2017. January sales volumes are reportedly above budget, a healthy order book is in place for the remainder of the quarter, and requisite back-office systems are being developed faster and at lower cost than initially anticipated. Furthermore, SigmaRoc has agreed terms with Santander Bank for a £2m revolving credit facility and is close to agreeing an £18m term facility – once finalized these debt facilities should see SigmaRoc sufficiently capitalized to progress initial projects in management’s pipeline of growth opportunities. We thus continue to believe that Ronez has potential to generate EBITDA to the group of at least £6m pa as efficiencies continue to be unlocked under the new independent ownership structure, providing SigmaRoc with a firm platform from which to leverage more acquisitions and/or organic investments and thus deliver further earnings growth as it progresses its niche buy-and-build strategy.
New Screen – Consistent Growth + “11 with legs”
17 Dec 15
To represent the theme of “Consistent Growth”, we introduce our second basket of small-cap stocks selected by a screening process. This will sit alongside our first (deep value) basket introduced and described in our note dated 26th May 2015 (Our first screen – 10 deep value stocks to consider). The screening criteria address both the extent AND the quality of growth in EPS and sales, which we consider add a worthwhile additional element to stock selection. The process results in a basket of 25 stocks, the performance of which we will track over time, allowing comparison of investment styles, but also highlighting interesting companies. We have taken a closer look at 11 stocks “11 with legs” (see list on the right) in this screen.