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Alcatel-Lucent swings to profit, to sell enterprise phone unit

  • Alcatel-Lucent (ALU) swung to a net profit of €134M in Q4 from a loss of €1.56B a year earlier, when the company took over a €1B in impairment and restructuring charges.
  • Revenue dropped 4.1% to €3.93B, below forecasts of €4.18B.
  • Adjusted operating profit €307M vs €115M, boosted by higher gross margins and cuts in fixed costs.
  • Operating margin +5 percentage points to 7.8%, an improvement that the company expects to continue.
  • Alcatel said it is on track to reach its 2015 targets of becoming cash-flow positive and sustainably profitable.
  • Alcatel is in negotiations to sell an 85% holding in its enterprise phone business to existing partner China Huaxin after the investment company made a binding offer that gives the business an enterprise value of €268M ($362M).
  • One question might be whether American authorities will approve the sale of the unit, which makes phone systems and other equipment for businesses, given the security concerns that the U.S. has over Chinese telecom gear.
  • The deal is part of Alcatel's strategy to sell at least €1B in assets as it refocuses on its most profitable businesses.
  • Alcatel won't pay a dividend for 2013. (PR)

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Comments (10)
  • jamesingram32
    , contributor
    Comments (633) | Send Message
     
    Coombes for president...he could probably sort France out as well.
    Killer results. Excellent stuft, transformed the company. Just look at the balance sheet, including the pensions book
    6 Feb 2014, 03:57 AM Reply Like
  • Seppo Sahrakorpi
    , contributor
    Comments (2082) | Send Message
     
    Congrats @james!
    6 Feb 2014, 07:27 AM Reply Like
  • jamesingram32
    , contributor
    Comments (633) | Send Message
     
    thanks Seppo, sort of makes up for the past 3 weeks of $NOK!
    6 Feb 2014, 09:10 AM Reply Like
  • manfredthree
    , contributor
    Comments (2344) | Send Message
     
    As expected. But we've only just begun. Long contracts, long tail revenues, growth from leading edge networking IP, and the secular forces of progressive network competition by providers.
    6 Feb 2014, 07:52 AM Reply Like
  • JoseV
    , contributor
    Comments (407) | Send Message
     
    And Shorts beware, Vive Ma Bell(e)!
    6 Feb 2014, 08:27 AM Reply Like
  • markatbbs
    , contributor
    Comments (5) | Send Message
     
    Always was a believer in ALU... Couldnt understand why wall street always looked down its nose at it? Is it purely their elitism smugness, or were there plans to attempt to trash the company in hopes of picking up the pieces later?
    6 Feb 2014, 09:27 AM Reply Like
  • Jack Lance
    , contributor
    Comments (45) | Send Message
     
    How high do you think ALU can go ? Dare I say $20 that is the highest it has been since it crashed from $80 at the turn of the century?
    6 Feb 2014, 09:16 PM Reply Like
  • jamesingram32
    , contributor
    Comments (633) | Send Message
     
    $20...whao, that is ambitious. What time frame would you put on that?
    $20...that would certainly have an impact on me...
    7 Feb 2014, 09:26 AM Reply Like
  • Jack Lance
    , contributor
    Comments (45) | Send Message
     
    If the new strategy they have works, we are talking about 2 to 5 years. It is time for ALU to S#$@ or get off the pot..... !

     

    BTW did you like that little dividend they paid at the end of last year?
    18 Mar 2014, 01:21 AM Reply Like
  • jamesingram32
    , contributor
    Comments (633) | Send Message
     
    hey, the dividend was nice, I would have swapped it for SP though!
    the SP is inching back up finally. perhaps our time may come?
    18 Mar 2014, 08:50 AM Reply Like
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