SHARE
COPY LINK

BUSINESS

Ericsson nets record profits

Ericsson has announced record profits for the fourth quarter of 2004, sealing the turn in the company’s fortunes. The Swedish telecoms company recorded pre-tax profits of 9.3 billion crowns, taking its full-year profits to 28.4 billion crowns. This compares with a loss of 12 billion crowns in 2003.

Carl-Henric Svanberg, Ericsson’s CEO, said that the company had strengthened its market position. Key new orders and an increased market share have both helped Ericsson to recover its position.

“We have experienced the strongest growth in mobile users ever,” he said. “With 300 million new subscribers in 2004, 27% of the world’s population now has access to mobile communications.”

While sales were up in many markets, they fell in the important North American market. Ericsson put this down to the impact of mergers between operators.

The profits follow a period of radical cuts at the company. From having a workforce of 107,000 worldwide in 2001, Ericsson now employs just over 50,000 people. Sweden was particularly hard hit by the job cuts, yet recently the trend has begun to turn, with the company taking one more employees.

As the profits were announced, Ericsson’s management predicted that the company would continue to gain market share, particularly in IT networks and service applications.

“The good growth of GSM and EDGE continues, especially in emerging markets, driven by the basic need for communication,” said Svanberg.

Sources: Svenska Dagbladet, Dagens Industri, Dagens Nyheter

ABB

Swedish engineering giant ABB to quit Russia over Ukraine

Swedish-Swiss engineering giant ABB said on Thursday it will quit Russia as a result of the war in Ukraine and the related international sanctions against Moscow.

Swedish engineering giant ABB to quit Russia over Ukraine

Russia accounts for only one or two percent of ABB’s overall annual turnover and the decision to pull out will have an estimated financial impact in the second quarter of around $57 million, the group calculated.

“ABB has decided to exit the Russian market due to the ongoing war in Ukraine and impact of related international sanctions,” the group said in a statement.

Russia accounts for only one or two percent of ABB’s overall annual sales and the decision to pull out will have an estimated financial impact in the second quarter of around $57 million, the group calculated.

READ ALSO: 

A large number of major western companies have pulled out of Russia since Moscow invaded its pro-Western neighbour on February 24.

“When the war broke out, ABB stopped taking new orders in Russia,” the group said.

At the same time, it said it continued to fulfill “a small number of existing contractual obligations with local customers, in compliance with applicable sanctions.”

Most of ABB’s dedicated Russian workforce has been on leave since March “and the company will do its best to support them as it realigns its operations in a controlled manner,” it said.

ABB has about 750 people in Russia and two production sites in the country located in the Moscow region and Lipetsk, as well as several service centres.

Separately, the group said that its net profit fell by 50 percent to $379 million in the second quarter, largely as a result of one-off charges, but also the cost of withdrawing from Russia.

Sales, on the other hand, grew by six percent to $7.2 billion in the period from April to June, ABB said.

SHOW COMMENTS