EU COMMUNICATIONS: Ericsson Q4; Slight Positive On Expanded Net Cash Position
Jan-24 08:02
ERICB
Report looks broadly in line with the top line slightly ahead on North America gains offsetting India weakness while EBITA was slightly soft on higher bonus accruals but with strong cash flow feeding through to an expanded net cash position. Equity is -4% on Tradegate on soft EPS.
- Q4 org revs +2% YoY (vs. +1.3% cons) driven by N. America +54% on contract wins (i.e. AT&T).
- This offset weakness in India contributing to -28% YoY growth in their Asia/Oceania segment.
- Q4 EBITA +25% YoY (-2% vs. cons) for a margin of 14.1% from 11.4% in Q423.
- Q4 CFO +21% YoY with FCF After M&A +29% YoY. Net cash of SEK 37.8bn (+SEK 12.3bn QoQ).
- Q125 sales seen similar to avg. seasonality of -24%/-33% QoQ for Networks/Cloud (vs. cons -22%/-30%) with a networks gross margin seen 47-49% (vs. cons of 45%).
- Restructuring charges to remain elevated next year.
- Starting soon: https://edge.media-server.com/mmc/p/gzrmxwuv/
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