Feeds

Nortel earnings slide 75 per cent

'Stabilised the business'

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

Troubled telecom equipment maker Nortel has posted a 75 per cent drop in profit in its fourth quarter.

The Canadian-based company's delayed fourth quarter earnings come as it gradually gets its books back in order after an accounting scandal that led to several restated results, a regulatory investigation and the firing of a number of executives.

Revenues were $2.62bn for Q$ 2004, compared to $3.27bn a year earlier. Net profit fell significantly from $133m, or $0.03 per diluted share, down from $528m, or $0.12 per share, a year earlier - a drop of 75 per cent. Revenue and per share earnings for the quarter were above Wall Street analysts' estimates of $2.51bn and $0.01 respectively.

Revenues dropped in all of Nortel's segments, including its wireless division, which saw earnings drop 11 per cent year-on-year to $1.28bn. Wireline networks revenues fell 19 per cent to $461m. Similarly, enterprise networks revenues totalled $651m, down 31 per cent from the year-ago quarter, while earning in the optical networks division dropped 28 per cent to $226m.

Despite the poor results, Nortel was pleased that the accounting issues of the past quarters had been resolved and was bullish about the future.

"I am proud of the progress we made during the past year, delivering solid performance in our core businesses through extremely unique and challenging circumstances," said Bill Owens, vice-chairman and chief executive officer of Nortel. "Our message is clear: Nortel is playing to win. In the past year, we've stabilised the business and laid the groundwork to move forward with velocity."

The company also posted its delayed 2004 audited results on Monday. For the year 2004 Nortel reported a loss of $51m, or $0.01 per share, compared to a profit of $434m, or $0.10 per share in 2003. Revenues were also down in 2004 to $9.83bn compared to $10.19bn for the year 2003.

"We remain focused on our core businesses and positioning Nortel to grow our revenues by leveraging our leading portfolio of next-generation solutions, capitalising on high growth markets in Asia and new opportunities in federal systems, security and services," said Owen. "Specifically we expect strong growth in our voice over packet, third-generation wireless, metro optical, wireless LAN and converged network solutions, coupled with new customer builds and network expansions. We continue to expect the demand for our mature solutions will decline."

With the fourth-quarter and 2004 audited financial results filed with regulators, Nortel is almost up to date on its filings and, if all goes to plan, it will become current with regulators in Canada and the US when it files its 2005 first-quarter results towards the end of May.

© ENN

Intelligent flash storage arrays

More from The Register

next story
Bladerunner sequel might actually be good. Harrison Ford is in it
Go ahead, you're all clear, kid... Sorry, wrong film
Musicians sue UK.gov over 'zero pay' copyright fix
Everyone else in Europe compensates us - why can't you?
I'll be back (and forward): Hollywood's time travel tribulations
Quick, call the Time Cops to sort out this paradox!
Megaupload overlord Kim Dotcom: The US HAS RADICALISED ME!
Now my lawyers have bailed 'cos I'm 'OFFICIALLY' BROKE
Euro Parliament VOTES to BREAK UP GOOGLE. Er, OK then
It CANNA do it, captain.They DON'T have the POWER!
Forget Hillary, HP's ex CARLY FIORINA 'wants to be next US Prez'
Former CEO has political ambitions again, according to Washington DC sources
prev story

Whitepapers

Seattle children’s accelerates Citrix login times by 500% with cross-tier insight
Seattle Children’s is a leading research hospital with a large and growing Citrix XenDesktop deployment. See how they used ExtraHop to accelerate launch times.
Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
How to determine if cloud backup is right for your servers
Two key factors, technical feasibility and TCO economics, that backup and IT operations managers should consider when assessing cloud backup.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Business security measures using SSL
Examines the major types of threats to information security that businesses face today and the techniques for mitigating those threats.