Apr 20, 2018 05:30 (GMT+0:00)
First quarter highlights (In 2017, certain items affecting comparability had a significant negative impact on the results.)
- Reported sales decreased by -9% YoY. Sales, adjusted for currency, decreased by -2% YoY with lower revenues in market areas North East Asia as well as in South East Asia, Oceania and India. The other market areas showed growth.
- Gross margin was 34.2% (15.7%) 1) . Gross margin excluding restructuring charges improved YoY, to 35.9% (18.7%) 1 ) , supported by cost reductions and the continued ramp-up of Ericsson Radio System (ERS).
- Operating income (loss) was SEK -0.3 (-11.3) b. Operating income (loss) excluding restructuring charges was SEK 0.9 (-9.5) b.
- Networks operating margin excluding restructuring charges was 13.5% (12.8%) 1) with strong gross margin and increased investments in R&D.
- Digital Services gross margin excluding restructuring charges improved YoY, to 41.4% (-25.5%) 1) , driven by improved services margins as a result of cost reductions. Operating income (loss) excluding restructuring charges was SEK -2.0 (-8.8) b.
- Managed Services operating margin excluding restructuring charges was 1.9% (-28.7%) 1) as a result of cost reductions and customer contract reviews.
- Cash flow from operating activities was SEK 1.6 (-1.5) b. and free cash flow was SEK 0.3 (-3.2) b. Net cash increased YoY to SEK 35.6 (28.3) b.
1) Write-down of assets as well as provisions and adjustments related to certain customer projects had a significant negative impact on the 2017 results. In addition, a restate of 2016 and 2017 numbers has been made following IFRS 15 introduction.