STOCKHOLM, SWEDEN — (Marketwire) — 10/19/11 —
* Net sales $412 million, including IP licensing to a third party
* Adjusted operating loss(1)) $194 million
* Revenue from new products passed the 50 percent threshold
Geneva, Switzerland, October 19, 2011 – ST-Ericsson, a joint
venture of
STMicroelectronics (NYSE: STM) and Ericsson (NASDAQ: ERIC), reported
financial
results for the third fiscal quarter ending October 1, 2011.
“Sales in the third quarter came in slightly ahead of expectations, even
when
excluding $20 million of revenue from IP licensing to a third party,”
said
Gilles Delfassy, president and CEO of ST-Ericsson. “Revenue from new
products
continued to grow, making up more than half of our total sales.
“We continue to make progress on having more devices in the market
with ST-
Ericsson inside. The first smartphone using one of our NovaThor
platforms
has ramped in the market – the HTC Sensation Z710t for China Mobile.
There are
also several new smartphone models in the market based on our Thor
modem
technology.
“Our financial performance continues to be challenging, but in
addition to
growing sales from new products, we-re on plan to execute the cost-
saving
measures announced in June, and we continue to make improvements
within our
organization to achieve greater efficiencies.
“With our new platforms starting to ramp in volume, we look forward to
seeing
more and more the benefits as we go into production in the coming quarters
with
several of the world-s largest smartphone and tablet makers.”
2011 third quarter financial summary (unaudited)
$ million Q3 2011 Q2 2011 Q3 2010
Income Statement
NET SALES 412 385 565
OPERATING INCOME/(LOSS) ADJUSTED(1)) for: (194) (181) (85)
– amortization of acquisition-related intangibles (25) (25) (25)
– restructuring charges (5) (15) (19)
OPERATING INCOME / (LOSS) as reported (224) (222) (129)
NET INCOME / (LOSS) (211) (221) (121)
$ million Q3 2011 Q2 2011 Q3 2010
Net Financial Position
Cash, cash equivalents & short-term deposits 20 18 89
Parent companies short-term credit facilities (614) (445) (50)
Net Financial Position²()) (594) (427) 39
Additional financial information
The net financial position(2) )at the end of the third quarter was negative
$594
million. The sequential decrease, mainly due to the operating loss, was
mitigated by actions to accelerate the cash conversion cycle and reduce
working
capital. During the third quarter the company sold trade receivables
without
recourse, of which $162 million were outstanding at the end of the quarter,
representing a sequential decrease of $17 million.
Inventory decreased by $37 million reaching $281 million at the end of the
third
quarter.
Outlook
For the fourth quarter 2011, ST-Ericsson expects net sales to be slightly
up
sequentially.
Highlights – products, technology and wins announced in third quarter 2011
* Products
* Launched its Nova-powered Snowball developer board in the
Chinese
market.
* Customers
* China Mobile and HTC launched the HTC Sensation Z710t in
September, the
first smartphone based on ST-Ericsson-s powerful new NovaThor
platform.
* Lenovo-s new Android-based ThinkPad tablet features
Ericsson-s
mobile broadband modules, based on ST-Ericsson-s Thor HSPA+
21Mbps
modem.
* Panasonic launched a smartphone based on ST-Ericsson-s Thor thin
modem.
Panasonic also announced that additional smartphones based
on ST-
Ericsson-s Thor HSPA+ 21Mbps thin modems will be available by the
end of
the year.
* Partners/technology
* To drive innovation in mobile augmented reality, ST-Ericsson
intensified
collaboration in mobile augmented reality research projects with
metaio,
a world leader in augmented reality solutions.
Financial results appendix (unaudited)
2010 financial results by quarter
$ million Q1 2010 Q2 2010 Q3 2010 Q4
2010
Income Statement
NET SALES 606 544 565
577
OPERATING INCOME/(LOSS) ADJUSTED(1)) for: (114) (118) (85)
(119)
– amortization of acquisition-related
intangibles (24) (25) (25)
(28)
– restructuring charges (27) (5) (19)
(24)
OPERATING INCOME / (LOSS) as reported (164) (148) (129)
(171)
NET INCOME / (LOSS) (154) (139) (121)
(177)
Footnotes
1) The adjusted operating income/(loss) is defined as the operating
income/(loss) reported before amortization of acquisition-related
intangibles
and restructuring charges and is used by management to help enhance the
understanding of ongoing operations and to communicate the impact of these
items
on the operating loss as reported.
2) Net financial position represents the balance between financial assets,
which
comprise cash, cash equivalents and short-term deposits, and financial debt
which includes bank overdrafts and parent companies short-term bridge
credit
facilities
Notes to editors
ST-Ericsson invites journalists, analysts and investors to a conference
call
scheduled on October 20, at 5pm CET. Call-in numbers, a live webcast of the
conference call, as well as supporting slides, will be available
atwww.stericsson.com/investors/investors.jsp.
About ST-Ericsson
ST-Ericsson is a world leader in developing and delivering a complete
portfolio
of innovative mobile platforms and cutting-edge wireless semiconductor
solutions
across the broad spectrum of mobile technologies. The company is a
leading
supplier to the top handset manufacturers and generated sales of $2.3
billion in
2010. ST-Ericsson was established as a 50/50 joint venture by
STMicroelectronics
(NYSE: STM) and Ericsson (NASDAQ: ERIC) in February 2009, with
headquarters in
Geneva, Switzerland.
###
The ST-Ericsson results reported in this press release do not reflect in
their
entirety the results of the Wireless Segment of STMicroelectronics, which
include other activities that are not part of ST-Ericsson.
###
This press release contains forward-looking statements that involve
inherent
risks and uncertainties. We have identified certain important factors that
may
cause actual results to differ materially from those contained in such
forward-
looking statements. For a detailed description of risk factors see
STMicroelectronics- (NYSE: STM) and Ericsson-s (NASDAQ: ERIC) filings with
the US
Securities and Exchange Commission, particularly each company-s latest
published
Annual Report on Form 20-F.
Third Quarter 2011 financial results:
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Ericsson via Thomson Reuters ONE
[HUG#1555857]
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