Alcatel-Lucent results blighted by Q4 write downs

Alcatel-Lucent wrote down the value of assets by €3.91 billion (US$5.1 billion) in Q408, as it posted its eighth consecutive quarterly loss amounting to €3.89 billion. This was a 51 per cent greater loss than reported in Q407. Write downs now total almost €8 billion since the merger of Alcatel and Lucent in 2006.

Alcatel-Lucent CEO Ben Verwaayen said the company met its targets for 2008 and he was encouraged by its operating performance, top-line, operating margin and cash flow targets

Revenues for the quarter came in €4.95 billion, down 5.3 per cent year-on-year. For the full year 2008, the company reported a loss of €5.215 billion, representing a 48 per cent larger loss than the one reported in 2007.

Revenue declined 4.5 per cent in 2008, which the company attributed to a shift in currency values. Based on constant currency exchange rates, fourth quarter revenue declined, but increased 16.9 per cent from the previous quarter.

Alcatel-Lucent’s CEO Ben Verwaayen said the vendor met its targets for 2008 and he was encouraged by its operating performance, top-line, operating margin and cash flow targets. Operating gross margin came in at 34.1 per cent for the full year.

“With an improving balance sheet, adequate funding, a new strategy in place and a clear roadmap to profitability, we are committed to executing on our plans to deliver better solutions and services to our customers and better returns to our shareholders,” commented Verwaayen.

Alcatel-Lucent expects the global telecommunications equipment and related services market to contract between eight and 12 per cent at constant currency in 2009. The company continues to anticipate an adjusted operating profit around break-even for the coming year.