You are here

Nokia's shares up in Helsinki on strong growth in networks

[HELSINKI] Share prices of Finnish telecom group Nokia rose 7.5 per cent Thursday in Helsinki as the company announced its network equipment business had significantly improved profitability in the second quarter.

The company reported group sales increased nine percent compared to the same period last year, to 3.2 billion euros (S$4.8 billion).

"I am particularly pleased by Nokia Networks, which rebounded dramatically from its tough start to the year," Nokia's chief executive Rajeev Suri said in a media conference call.

The group's second quarter attributable net profit was down to 347 million euros, compared to 2.5 billion euros last year - a dramatic drop resulting from discontinued operations. Nokia's Devices and Services unit - the unprofitable handset business - whose sale to Microsoft in 2013 was finalised in April 2014, contributed to net profit in the second quarter 2014.

Operating profit almost doubled to 508 million euros in Q2, compared to 284 million last year.

"HERE and Nokia Technologies also maintained their excellent momentum, both delivering year-on-year sales and profit growth," Mr Suri said referring to the company's mapping unit and its advanced technology and licensing business.

Despite recent media speculation of German carmakers seeking to acquire Nokia's HERE for its mapping and location system activities, the company did not reveal any details of ongoing negotiations.

"I would like to reiterate that our goal is to find the best possible solution for Nokia and it's shareholders, and for HERE and its employees and customers," Mr Suri commented.

In mid-April Nokia struck a 15.6 billion euro deal to buy its rival Alcatel-Lucent to create the world's biggest supplier of mobile phone network equipment.

Mr Suri said Thursday Nokia expects to finalise the deal in the first half of 2016.

"Both of our companies are cooperating with all remaining authorities to close the deal as quickly as possible," he said.

In Paris Thursday, Alcatel-Lucent announced it had reduced its second quarter losses to 54 million euros compared to 298 million during the same period last year, causing its share price to rise 5.7 per cent in a CAC index trading 0.09 per cent higher.