Alcatel-Lucent Q4 net loss at Euro 1.37 billion

Alcatel-Lucent reported Q4 net loss at Euro 1.37 billion or Euro 0.60 per share.

The company's revenues for Q4 was Euro 4.096 bn, up 13.8 percent quarter-over-quarter and lower by 1.3 percent year-over-year on a reported basis. The company completed 2012 with revenues of Euro 14.446 bn, lower by 5.7 percent year-over-year on a reported basis.

Alcatel-Lucent announced 2012 full year results in line with its guidance and costs savings close to Euro 650 million, which is ahead of plan, and, in the fourth quarter of 2012, a free cash-flow of Euro 355 million with an adjusted operating margin of 2.9 percent.

Ben Verwaayen, CEO Alcatel-Lucent, commented "Our fourth quarter reflects the early progress of The Performance Program announced last July. We announced clear choices on where we would operate, how we would operate and where we would differentiate."

"We have seen progress on all these choices, and close 2012 ahead on our cost reduction plans. We have addressed half of the previously margin-diluting Managed Services contracts, and show continued and strong growth in IP and Next Generation Wireless. We can see a clear statement of customer confidence through growth in both our order book and backlog," added Ben Verwaayen.

In addition, we completed a Euro 2 billion financing which enables us to extend our near-term maturities, stabilizes our balance sheet and provides us with the flexibility to finalize The Performance Program added Verawaayen.

Verwaayen added "Through 2013 we will remain focused on completing The Performance Program. We will deploy our resources to customer relationships where we are a true partner and in product areas where we can drive an economic return for our shareholders."

For the fourth quarter 2012, revenues for the Networks segment were Euro 2,421 million, a decrease of 2.2 percent compared to Euro 2,476 million in the year-ago quarter and a 10.7 percent increase compared to Euro 2,187 million in the third quarter 2012.

Revenues for the IP division reached their highest level ever at Euro 574 million, increasing 26.4 percent from the year ago quarter. Growth was driven by continuous progression in the Americas and by our breakthroughs in Japan and China, which drove the Asia-Pacific region to witness a record quarter in IP revenues, above Euro 100 million.

Looking at full year 2012, the IP division sales increased 24.2 percent, marking a year of growth acceleration compared to 2011.

Revenues for the Optics division were Euro 565 million, a decrease of 22 percent from the year-ago quarter. Against the secular decline of legacy optics, persisting throughout the year at around -30 percent, our WDM portfolio has slowed down its pace of decline, from -14 percent in first half 2012 to almost flat in second half 2012, and now representing more than half of our terrestrial optics revenues.

Revenues for the Wireless division stabilized to Euro 913 million, an increase of 2.2 percent from the year-ago quarter, after four straight quarters of double-digit declines. Looking at the full year 2012, the transition from 2G/3G to 4G in North America and an overall continued cautiousness in the rest of the world has led to a 35 percent decline of our legacy technologies, partially offset by a healthy LTE growth.

In the fourth quarter, the 4G LTE business, driven by stronger spending by US service providers, marked its highest quarter of revenues ever and the quality of our solution is again demonstrated through our selection by Oi in Brazil, by Rio Tinto in Western Australia, and by several African operators such as Smile in Tanzania and Uganda.

In the fourth quarter, resulting from a higher comparison base, wireline sales declined 7.4 percent from their year-ago level to Euro 388 million. The IP DSLAM business was slightly declining, offset by the fiber business slightly growing, driven by the Americas.

The comoany shipped close to 1 million GPON ports and on the backdrop of the copper networks revitalization, our Vectoring solution continued its success in the market, with nine commercial contracts to-date and more than 40 trials around the world.

For the fourth quarter 2012, revenues for the S3 (software, services, and solutions) segment were Euro 1,387 million, an increase of 5.5 percent compared to Euro 1,315 million in the year-ago quarter and an increase of 20.1 percent compared to Euro 1,155 million in the third quarter 2012.

Revenues in services business were Euro 1,147 million, a 0.9 percent decrease compared to the year-ago quarter. Reflecting our initiative to review and restructure our Managed Services business, sales have slowed down from double-digit growth in the first half of 2012 to a low single-digit decline in the fourth quarter.

Network Applications revenues increased 52.9 percent from their year-ago level, to Euro 240 million in the fourth quarter, leading to an overall full year growth of 6.4 percent.

Our "Strategic Industries" services business (including transportation, energy, and the public sector) had strong growth in the quarter, driven by APAC and EMEA regions, both increasing in the double digit range compared to the year-ago quarter.

For the fourth quarter of 2012, revenues in Enterprise business were Euro 207 million, a decrease of 3.7 percent compared to Euro 215 million in the year-ago quarter and an increase of 10.1 percent compared to Euro 188 million in the third quarter 2012.