Ericsson Reports Fourth Quarter And Full-Year Results 2020 - GADGET-INNOVATIONS

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Ericsson Reports Fourth Quarter And Full-Year Results 2020

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Fourth Quarter Highlights


  • Sales adjusted for comparable units and currency grew by 13% YoY mainly driven by sales in North East Asia, Europe and North America. Reported sales were SEK 69.6 (66.4) b.

  • Gross margin excluding restructuring charges improved to 40.6% (37.1%) with margin improvements in all segments. Reported gross margin improved to 40.6% (36.8%).

  • Operating income excluding restructuring charges improved to SEK 11.0 b. (15.8% operating margin) from SEK 6.5 b. (9.7% operating margin) mainly driven by Networks. Reported operating income was SEK 11.0 (6.1) b.

  • Networks sales increased by 20% YoY, adjusted for comparable units and currency. Operating margin excluding restructuring charges was 21.5% (14.5%).

  • Reported net income was SEK 7.2 (4.5) b.

  • Free cash flow before M&A was SEK 12.8 (-1.9) b. Q4 2019 included a payment of SEK 10.1 b. related to the resolution of the US SEC and DOJ investigations. Net cash Dec 31, 2020, was SEK 41.9 (34.5) b. 



Full-year highlights


  • Sales adj. for comp. units and currency grew by 5%, with Networks growing by 10%. Reported sales increased by 2% to SEK 232.4 b.

  • Gross margin excl. restructuring charges was 40.6% (37.5%), with improvements in all segments.

  • Reported operating income improved to SEK 27.8 (10.6) b.  

  • Reported net income was SEK 17.6 (1.8) b.

  • Free cash flow before M&A amounted to SEK 22.3 (7.6) b. Full-year 2019 included a payment of SEK 10.1 b. related to the resolution of the US SEC and DOJ investigations.

  • The Board of Directors will propose a dividend for 2020 of SEK 2.00 (1.50) per share to the AGM.



Planning assumptions highlights (please see the quarterly report for complete planning assumptions)


  • Three-year average reported sales seasonality between Q4 and Q1 is -24%; however, the seasonal effect may be somewhat less pronounced due to 5G deployment in some of Ericsson’s markets.




SEK b.

Q4
2020

Q4
2019

YoY
change

Q3
2020

QoQ
change

Jan-Dec
2020

Jan-Dec
2019

YoY
change

Net sales

69.6

66.4

5%

57.5

21%

232.4

227.2

2%

Sales growth adj. for comparable units and currency 

13%

5%

Gross margin 

40.6%

36.8%

43.1%

40.3%

37.3%

Operating income (loss) 

11.0

6.1

80%

8.6

27%

27.8

10.6

163%

Operating margin 

15.8%

9.2%

15.0%

12.0%

4.6%

Net income (loss) 

7.2

4.5

60%

5.6

29%

17.6

1.8

EPS diluted, SEK 

2.26

1.33

70%

1.61

40%

5.26

0.67


Measures excl. restructuring charges and other items affecting comparability[1]

Gross margin excluding restructuring charges 

40.6%

37.1%

43.2%

40.6%

37.5%

Operating income excl. restr. charges & items affecting compar. in 2019[2] 

11.0

5.7

92%

9.0

23%

29.1

22.1

32%

Operating margin excl. restr. charges & items affecting compar. in 2019[2] 

15.8%

8.6%

15.6%

12.5%

9.7%

Free cash flow before M&A 

12.8

-1.9

3.9

22.3

7.6

192%

Net cash, end of period 

41.9

34.5

21%

41.5

1%

41.9

34.5

21%




[1] Non-IFRS financial measures are reconciled at the end of this report to the most directly reconcilable line items in the financial statements.



[2] Operating income excludes restructuring charges in all periods and cost provisions related to the resolution of the SEC and DOJ investigations of SEK -11.5 b. in Q3 2019 as well as a partial release of the same provision of SEK 0.7 b. in Q4 2019.








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