Telefonaktiebolaget LM Ericsson Class A · OMXSTO:ERIC_A

Telefonaktiebolaget LM Ericsson Class A — Ericsson — Q4 2003 Earnings Presentation

14 slides from Telefonaktiebolaget LM Ericsson Class A's earnings presentation, January 2004

  1. Slide 1: Fourth Quarter Report

    ERICSSON Z FOURTH QUARTER REPORT

  2. Slide 2: Carl-Henric Svanberg, President and CEO

    CARL-HENRIC SVANBERG President and CEO 2

  3. Slide 3: Successful turnaround

    Successful turnaround ƒ Back to profitability - full year adjusted profit ƒ Major employee achievement ƒ Solid financial position ƒ Cost and operational excellence remain in focus Major restructuring is over 3

  4. Slide 4: In focus 2004

    In focus 2004 ƒ 3G rollout accelerates – EDGE a natural complement especially in rural areas ƒ Capacity constraints in GSM networks ƒ Focus on seamless services – Reachability and ease of use 4

  5. Slide 5: 3G rollout accelerates

    3G rollout accelerates ƒ Large number of WCDMA rollouts – Ericsson in 46 networks – unique experience ƒ Strong global 3G subscription growth – ~2.8 million, up 65% sequentially in WCDMA – ~70 million, up 15% sequentially in CDMA2000 1X ƒ Handsets and applications in focus Preparing for mass market i

  6. Slide 6: Opportunities in emerging markets

    Opportunities in emerging markets ƒ Opportunities through ”Ericsson Expander” – new coverage optimized technology ƒ Low consumer spend no longer a barrier ƒ Operators can address far more consumers Increases market potential 6

  7. Slide 7: 2003 highlights

    2003 highlights ƒ 3G contracts: 23 – Six in the quarter; 2 WCDMA, 1 CDMA2000 1X, 3 EDGE ƒ Growing market for managed services – Two new contracts in the quarter ƒ Pick-up in demand for GSM/GPRS – Result of traffic increase and certain catch-up effects Strengthened position in leading technologies 7

  8. Slide 8: Successful restructuring

    Successful restructuring ƒ Major restructuring completed – Remaining adjustments by the third quarter ƒ Operating expenses run rate SEK 37 b. – Targeting run rate of SEK 33 b. Q3 2004 ƒ Gross margin 41.6% – Accelerated cost of sales reductions – High capacity utilization in Q4 Cost and operational e

  9. Slide 9: Q4 financial highlights

    Q4 financial highlights ƒ Orders received SEK 31.0 b. – Bookings SEK 29.5 (30.7) b. incl. previous years adjustments ƒ Sales SEK 36.2 (36.7) b., up 29% from Q3 – Up SEK 8.2 b. sequentially ƒ Gross margin 41.6% (32.6%) – Up 5.7 percentage points sequentially Gross margin - exceeding expectations 9

  10. Slide 10: Q4 financial highlights (cont.)

    Q4 financial highlights (cont.) ƒ Adjusted income after fin. SEK 5.5 (-2.1) b. – Before restructuring ƒ Cash flow before fin. SEK 4.6 (1.6) b. – Including one-time payments of SEK 3.7 b. ƒ Strong financial position – Net cash SEK 27.0 b. Full year adjusted profit of SEK 2.8 b. 10

  11. Slide 11: Sony Ericsson Q4 highlights

    Sony Ericsson Q4 highlights ƒ 10% sequential sales growth ƒ Income before tax EUR 46 m. – Profit second consecutive quarter ƒ Successful product strategy – GSM shipments up 50% year-on-year – Japanese shipments up 15% year-on-year Attractive product portfolio gaining momentum 11

  12. Slide 12: Market outlook 2004

    Market outlook 2004 ƒ Mobile systems market in line with, or to show slight growth, compared to 2003 (USD) – Moderate year-over-year sales growth expected in Q1 – Monitoring sustainability of growth trend ƒ Good growth in professional services markets Improving market conditions 12

  13. Slide 13: Summary

    Summary ƒ Successful turnaround – Cost awareness and operational excellence remain in focus ƒ 3G accelerates – Strengthened market and technology leadership ƒ Focus-shift toward consumers – Seamless networks, reachability, ease of use Industry with obvious growth potential 13

  14. Slide 14: Fourth Quarter Report

    ERICSSON Z FOURTH QUARTER REPORT

Ericsson — Q4 2003 Earnings Presentation on 6ix