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ERICSSON

Ericsson profits surge

Swedish mobile phone giant Ericsson said on Friday it made a net profit in 2006 of 26.3 billion kronor, up 8.2 percent on the previous year, thanks to acquisitions and strong sales.

Turnover rose 17 percent to 177.8 billion kronor, from 151.8 billion a year earlier, the company said in a statement.

Sales in the fourth quarter of 2006 alone were 53.7 billion, a 17.5-percent increase on the same quarter in 2005.

“We have concluded another successful year and see continued opportunities to outpace the market,” chief executive Henric Svanberg said in the statement.

Svanberg said the company was “well positioned for 2007”, noting that costs had risen more slowly than sales.

“With our leading positions in mobile networks and professional services, substantial investments in next-generation IP networks and multimedia, we have the platform to continue to capture market share and drive the industry forward,” he said.

Ericsson said it expected growth of 4.0 to 6.0 percent in its main market, that of third generation mobile phone networks (GSM/WCDMA). Previously it had forecast only “moderate” growth in this market, which accounts for more than 80 percent of the world mobile phone network.

SWEDEN AND UKRAINE

Ericsson suspends all Russia operations indefinitely

Swedish network equipment maker Ericsson said Monday that it was suspending all of its Russian operations over the war in Ukraine for the foreseeable future.

Ericsson suspends all Russia operations indefinitely

The telecom giant already announced in late February that it would stop all deliveries to Russia following Moscow’s February 24 invasion of Ukraine.

“In the light of recent events and of European Union sanctions, the company will now suspend its affected business with customers in Russia indefinitely,” Ericsson said in a statement.

The company added that it was “engaging with customers and partners regarding the indefinite suspension of the affected business.”

“The priority is to focus on the safety and well-being of Ericsson employees in Russia and they will be placed on paid leave,” it said.

READ ALSO: How has Sweden responded to Putin’s war in Ukraine so far?

Hundreds of Western firms ranging from Ikea to Coca-Cola, Goldman Sachs and McDonald’s have stopped operations in the country since the invasion, with French banking group Societe Generale announcing Monday it was selling its stake in Russia’s Rosbank.

Ericsson has around 600 employees in Russia, and is a “major supplier to the largest operator MTS and the fourth largest operator Tele2,” a company spokeswoman told AFP, adding that together with Ukraine, Russia accounts for less than two percent of revenue.

As a result, the equipment maker said it would record a provision for 900 million Swedish kronor ($95 million, 87 million euros) for the first quarter of 2022 for “impairment of assets and other exceptional costs,” though no staff redundancy costs were included.
Ericsson is due to publish its first quarter earnings on April 14.

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