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Research Tree provides access to ongoing research coverage, media content and regulatory news on ERICSSON LM-B SHS. We currently have 8 research reports from 1 professional analysts.
|25Apr17 06:29||GNW||Ericsson reports first quarter results 2017|
|19Apr17 08:00||GNW||Ericsson launches fully virtualized video processing platform|
|11Apr17 10:00||GNW||Invitation to media and analyst calls for Ericsson Q1 2017 report|
|29Mar17 17:23||GNW||Ericsson's Annual General Meeting 2017|
|28Mar17 06:32||GNW||Ericsson simplifies organization and names Executive Team|
|28Mar17 06:31||GNW||Ericsson presents focused business strategy|
|10Mar17 07:00||GNW||Ericsson reports restated financials for 2015 and 2016|
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ERICSSON LM-B SHS
ERICSSON LM-B SHS
Too little improvement offset by persistent weaknesses
25 Apr 17
Ericsson reported Q1 revenues of SEK46.4bn, corresponding to a decrease of 11.2% yoy on a reported basis, while on a comparable basis (comparable units and currency) the decline was 16%. Latin America (-29%), Northern (-24%) and Central (-17%) Europe witnessed sharp drops, while South-East Asia & Oceania showed some growth (+7%). Under the new reporting structure, Networks fell by 12.7% yoy (SEK34.9bn), IT & Cloud by 2.9% (SEK9.5bn) and Media by 19.6% (SEK2bn). Provisions and customer project adjustments had a one-off negative impact of SEK1.4bn. The gross margin came in at 13.9% and was massively impacted by restructuring charges (SEK1.5bn) and customer-related provisions (SEK6.7bn), leading to an adjusted gross margin of 30.5%, down 340bp yoy. Similarly, EBIT was impacted negatively by a total of SEK13.4bn of charges: SEK1.7bn of restructuring, SEK3.3bn of write-downs and SEK8.4bn of provisions; as a consequence, the adjusted EBIT margin came in at 2.3% but the reported EBIT margin at -26.6%. EPS came in at SEK-3.29. The company maintained its annual run rate target of SEK7bn for IPR Licensing (SEK10bn in 2016) and the RAN equipment market forecast at between -2% to -6% in USD; restructuring charges are now expected to reach SEK6-8bn, while renewed Managed Services contracts with reduces scope in North America will have a negative impact on Q2 and Q3 revenues, while an additional negative impact of SEK10bn by 2019 is expected due to low-performing operations in the Managed Services and Networks roll-out.
Little enthusiasm for 2017
26 Jan 17
Ericsson reported Q4 revenues of SEK65.2bn, corresponding to a decrease of 11.4% yoy. On a comparable basis (comparable units and currency), however, the decline was 15%. The Middle East, NE Asia and SE Asia were the only areas to show substantial yoy growth (respectively +5%, +8% and +25%), the latter being the only region to display growth on a yearly basis. Networks fell by 13.1% yoy (SEK32.4bn), Global Services by 4.1% (SEK29.4bn) and Support Solutions by 39.5% (SEK3.4bn). The gross margin, excluding restructuring charges, decreased yoy by 720bp to 29.4%, due once again to an unfavourable mix (lower IPR licensing revenues and lower-margin Global Services revenues). In addition, the operating margin was negatively impacted by SEK4.6bn of restructuring charges, an amount caused by an acceleration in the execution of the cost-savings programme, resulting in a 1,540bp decline yoy (-0.4%), while EBIT excluding these charges came in at 6.7% (-930bp). EPS came in at SEK-0.48. The company announced a dividend of SEK1 per share for 2016, compared to SEK3.70 the year before. The company also announced for 2017 an annual run rate of SEK7bn for IPR Licensing (SEK10bn in 2016), restructuring charges of SEK3bn and persistent weak market conditions (-2% to -6% in USD).
No fireman seems to be willing to extinguish the fire
21 Oct 16
Ericsson reported sales of SEK51.1bn, a decrease of 13.7% yoy, which was expected after the profit warning on 12 October. On a comparable basis (comparable units and currency), however, the decline was 7%. Every region but SE Asia displayed a decrease, the sharpest being once again in the Middle East (-25%). Networks fell by 19% yoy (SEK23.3bn), Global Services by 8.3% (SEK24.8bn) and Support Solutions by 10.9% (SEK2.9bn). The gross margin, excluding restructuring charges, decreased yoy by 490bp to 29.4%, due to an unfavourable mix. The operating margin was therefore negatively impacted yoy, losing 790bp at 0.7% (710bp excluding restructuring). The EPS came in at SEK-0.07, corresponding to a 106% decline yoy. As a consequence, the company announced an intensification of its restructuring effort in the short term as a way to offset the sales decline. However, the weak market conditions are expected to remain in the short term.
No growth and more cost-cutting, again
20 Jul 16
Ericsson reported sales of SEK54.1bn, a decrease of 10.8% yoy. On a comparable basis (comparable units and currency), however, the decline was 7%. The company performed well in South America and Oceania, while all other regions displayed a decrease, the sharpest being in the Middle East (-24%). Networks fell by 14.1% yoy (SEK26.8bn), Global Services by 7.2% (SEK24.5bn) and Support Solutions by 8.2% (SEK2.9bn). The gross margin, excluding restructuring charges, decreased yoy by 190bp to 33.2%, due to an unfavourable mix including stronger revenues from lower-margin mobile broadband products compared to software and services-related products. The operating margin was negatively impacted yoy, losing 80bp (340bp excluding restructuring) due to a less IP in the mix. The EPS came in at SEK0.48, corresponding to a 26% decline yoy. As a consequence, the company announced an intensification of its restructuring effort, as it will reduce investments in IP and bring down the annual run rate of opex at SEK53bn in H2 17 vs. SEK63bn in 2014. However, the weak market conditions are expected to remain in H2.
A difficult Q1, with no trigger to be expected in the mid-term
21 Apr 16
Ericsson reported sales of SEK52.2bn, a decrease of 2.4% yoy. On a comparable basis (comparable units and currency), however, the decline is limited to 1%. The company performed well in North America and in South-East Asia, while there was some weakness in most other regions, with a particular drop in India (-24%) and Europe (-17%). The gross margin, excluding restructuring charges, decreased yoy by 240bp to 33.9%, due to an unfavourable mix including stronger hardware sales compared to software and services-related products. The operating margin was favourably impacted by improvements in Networks, reaching 7.9% excluding restructuring charges, up 280bp yoy (6.6% and up 270bp including these charges). However, due to the challenging market conditions and strong headwinds on the top-line perspectives, the company decided a reorgansiation of the business, which will be effective by July 2016, as well as an acceleration of its restructuring programme, which will lead to annual charges of SEK4-5bn vs. SEK3-4bn previously expected.
Relying on cost-cutting to preserve profits in the face of no growth
28 Jan 16
Ericsson reported sales of SEK73.6bn, an increase of 8% yoy. On a comparable basis (comparable units and currency), however, sales were down by 1%. The company performed well in emerging markets such as India, Indonesia and Mexico, while there was some weakness in Russia and Brazil, as in the previous quarter, as well as in the Middle-East. North America and China recovered after a difficult Q3. Despite an IPR agreement with Apple, the gross margin excluding restructuring charges decreased yoy by 100bp at 36.6%, due to an unfavorable mix including stronger hardware sales. The operating margin was favorably impacted by the global cost and efficiency program, which is progressing according to plan (annual net savings of SEK9bn during 2017 relative to 2014). As a consequence, and also due to the lower impact of currency hedge contracts and positive currency effects, the operating margin including restructuring charges came in at 15%, an increase of 570bp yoy, while the increase was 550bp without these charges (16% vs. 10.5%).
20 Apr 17
TEP’s trading update for the year to March 2017 highlights modest growth as expected, with a total dividend of 48p (25p final dividend) in line (49pE). FY18 forecasts are trimmed 3% at adjusted PBT level, to remain in line with FY17, with better quality customers taking all possible services – at a higher cost of acquisition but better prospective year 2 margins. With the positive outlook that a narrowing of the gap between standard variable energy tariffs and aggressively priced introductory deals has led to an encouraging upward trend in Q4 to March, prospects for restored growth in revenue (FY18) and profit (FY19) are strong. Improved incentivisation of the self employed salesforce, after a few years of lower growth, is complemented by the imminent addition of Home Insurance, adding sales momentum and increased customer interest as utility prices rise. With the double upside to the £70m tender offer in summer, and the June release of FY19 forecasts illustrating growth following greater detail available at prelims, the future is brighter for TEP. Target 1360p reiterated.
25 Apr 17
Fenner (FENR): Forecast upgrades follow strong interims (BUY) | Omega Diagnostics* (ODX): In-line trading update and FY18 estimates (CORP) | Minds + Machines* (MMX): Prelims pressing ahead (CORP) | Imaginatik* (IMTK): Year-end trading update (CORP) | OptiBiotix* (OPTI): FY16 results in line with expectations (CORP) | Europa Oil & Gas*, (EOG): Irish seismic contractor (CORP) | Sound Energy (SOU): Schlumberger investment (HOLD) | CityFibre* (CITY): Strategy proof point (CORP) | Connect (CNCT): Investment being made to drive growth (BUY)
Northland Capital Morning Report
02 Dec 15
Divergence looks set to dominate the final month of 2015 and set the tone for 2016. The European Central Bank is widely expected to extend its QE economic stimulus programme and could reduce its overnight deposit rate further in an attempt to boost inflation, and more stimulus could come from Japan and China. Meanwhile the Federal Reserve is now expected to lift rates from historic lows. Higher US rates will impact not only the cost of capital in the US but also emerging markets where growth remains much weaker and leverage high. The move by the ECB is unlikely to have a major impact, however, as it is an extension rather than a new tool and the headlines continue to be dominated by politics rather than financial markets (Isis, the refugee/migrant crisis, tensions between Russia and Turkey etc). The respective moves are likely to further weaken the euro in 2016. The UK sits somewhere in the middle. November’s Autumn Statement saw the Chancellor drop his tax credit reduction plans and benefit from a surprise £27bn improvement in the Office for Budget Responsibility’s five year public finances forecast, based on higher tax revenue and lower debt interest. The general shift away from austerity, the protection of tax credits and increased minimum wage should ensure further economic growth.
Strong performance in the non-legacy business
20 Apr 17
TomTom reported Q1 revenues of €212.7m, down 2% yoy and 19.9% sequentially. Consumer decreased by 16% yoy to €98m, representing the main down-mover. The three other businesses combined grew by 14.1% to €114.7m, with in decreasing order Automotive (€41.1m, +38.4% yoy), Telematics (€40.6m, +9.4%) and Licensing (€33m, -2.1%). The gross margin came in at 62.2%, up 540bp yoy, while the EBIT margin lost 30bp to -2.3% (-€4.8m). EPS came in at €-0.02 and adjusted EPS at €0.03. The company re-iterated its guidance for FY17 with adjusted EPS of around €0.25 and revenues of between €1,025 and €1,050m.
31 Jan 17
Alumasc (ALU): Interims show strong sales growth but some margin pressure (BUY) | Joules Group (JOU): Marginal increase to FY17E forecast (BUY) | CityFibre* (CITY): Prospects shine (CORP) | Nasstar* (NASA): Trading update (CORP) | SCS Group (SCS): LFL order intake slowed during Q2 (BUY)