Nokia reports 9-month operating profit and sales up

Nordic Business Report, Oct 20, 2005

NORDIC BUSINESS REPORT-20 October 2005-Nokia reports 9-month operating profit and sales up(C)1994-2005 M2 COMMUNICATIONS LTD http://www.m2.com

Finnish telecomms solutions provider Nokia reported on Thursday (20 October) an operating profit of EUR3.27bn on net sales of EUR23.9bn for the financial period January-September 2005.

Both operating profit and net sales for the nine-month period increased, respectively from EUR2.88bn and EUR19.9bn, as compared to the corresponding period in 2004.

Operating profit for the Mobile Phones division decreased by 5% to EUR2.54bn while net sales increased by 15% to EUR14.6bn. Both operating profit and net sales for the Networks division increased, respectively by 2% to EUR578m and by 5% to EUR4.40bn.

Earnings per share (EPS) in January-September 2005 increased to EUR0.58 from EUR0.46 in January-September 2004.

Nokia reported an operating profit of EUR1.15bn for the financial quarter July-September 2005, up 19% from July-September 2004. Net sales for the period increased 20% to EUR8.40bn.

The total mobile device sales in the third quarter amounted to 66.6 million units, an increase of 29.5% year-on-year. Overall market volumes for the same period reached an estimated 199 million units, representing 24% annual growth.

In smartphones, according to Nokia estimates, the total industry volume reached some 14 million units for the third quarter 2005, compared with an estimate of 5.2 million units in the third quarter 2004. Nokia's own smartphone volume grew to 7.1 million units, compared with 2.9 million units in the third quarter last year.

Nokia estimated its market share at 33%, compared with 32% in the third quarter of 2004.

Jorma Ollila, CEO of Nokia, said that overall industry volume growth for the third quarter continued to exceed Nokia's expectations, prompting the company to upgrade its full-year market estimate to some 780 million units.

Industry volumes in the fourth quarter of 2005 are expected to reflect the usual holiday seasonality and grow compared with the third quarter.

Nokia's mobile device volume growth is expected to exceed overall market growth in the fourth quarter, with the company's market share expected to increase both year-on-year and sequentially.

In mobile infrastructure, Nokia continues to expect the overall market in 2005 to be slightly up compared with 2004 in euro terms.

Nokia said that it expects its own networks sales to be down year-on-year when compared to the exceptionally strong sales generated by operator year-end spending in the fourth quarter of 2004, but also due to the fact that a significant amount of operators' current investment is taking place in markets where the Networks division has not historically had a major presence, such as the Middle East and Africa.

One euro (EUR) is worth approximately 0.68 British pounds (GBP).

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