Alcatel-Lucent SA (ALU: Quote) on Tuesday said it expects an operating loss excluding certain items in its second quarter. The company is now expecting a revenue for the quarter, lower than last year's, reflecting slower than expected business mix improvement.
However, the French telecommunications equipment maker expects the second half of 2012 to be better than the first half. But, the company said it expects to miss its fiscal 2012 adjusted operating margin guidance of above last year's 3.9 percent, citing difficult macro-economic environment. The shares declined around 11% in the morning trade in Paris.
Earlier in April, Alcatel-Lucent had maintained its previous yearly forecast for improved margin, expecting better visibility on its profitability at the end of the second quarter. At that time, Alcatel-Lucent CEO Ben Verwaayen had said, "As 2012 continues to unfold we will maintain strict financial discipline and we will leverage a number of significant next generation network roll-outs around the globe, in particular in North America and China, as well as those expanding our position in countries such as Japan and in Latin America."
The leader in 3G for CDMA is coping with rapid customer migration from CDMA to 4G LTE services, particularly in North America, and continuing market uncertainties in Europe.
Verwaayen had earlier said the company's first-quarter results reflected a slow start to the year while demonstrating good control on both cash and costs and a strong momentum in our next generation products portfolio.
In February, Alcatel-Lucent announced its first annual profit in six years after Alcatel SA and Lucent Technologies merged in 2006. Then, it had expected higher operating profitability in 2012.
On a preliminary basis, Alcatel-Lucent today said it expects second-quarter adjusted operating loss of around 40 million euros, compared to prior year's profit of 108 million euros. In the preceding first quarter, the company generated adjusted operating loss of 221 million euros that reflected a nearly 30 percent drop in wireless segment revenues impacting its margins.
Revenues are now projected to be above 3.5 billion euros for the quarter, but lower than last year's 3.90 billion euros, while higher than the 3.21 billion euros generated in the first quarter. In its first quarter, North America witnessed a double digit decline, while Central and Latin America saw a double digit growth rate and Asia Pacific was more resilient than Europe, where uncertainties continue to prevail.
In Paris, Alcatel-Lucent shares are currently trading at 1 euro, down 0.13 euros or 11.46 percent.
In the U.S., the shares declined 4.20 percent to close at $1.37.
| || |
| To receive FREE breaking news email alerts for Alcatel-Lucent and others in your portfolio|
by RTT Staff Writer
For comments and feedback: email@example.com