Nokia shares still lower: Nokia is becoming more optimistic in the long term

Nokia boss Pekka Lundmark justified this on Thursday when presenting the business figures for the past year with progress in the restructuring of the group. In addition, as a result of the high inflow of funds (cash flow) over the past two years, the manager announced a share buyback program of up to EUR 600 million, which is to begin in the first quarter and run for two years.

Lundmark announced last March that it would cut up to 10,000 jobs over a period of 18 to 24 months. This should also reduce costs by around 600 million euros by the end of 2023, which should compensate for higher investments in research and development, for example.

Against this background, Nokia is now aiming for an adjusted operating margin of at least 14 percent in the long term, i.e. over a three to five year period, according to Thursday’s announcement. The old goal of a comparable operating profit of up to 13 percent of sales had applied to 2023. Sales growth should continue to outperform the market.

In the past year, the Finns achieved an operating margin of 12.5 percent on a comparable basis with sales growth of 1.6 percent to 22.2 billion euros. However, they also benefited from the one-off effects of their venture capital investments, without which the margin would have been around 11 percent. Operating profit rose by around a third to 2.8 billion euros. Sales and the operating result were thus at the levels announced in January. The bottom line is that on a comparable basis, almost 2.1 billion euros remained after 1.4 billion a year ago.

For 2022, Lundmark calculates sales of 22.6 to 23.8 billion euros, which is in the middle of the range above the average analyst estimate. Adjusted operating profit should be 11 to 13.5 percent. The CEO referred to a high order backlog, but also to the continuing tense situation with regard to the global supply chains.

The Nokia share temporarily loses 2.95 percent in Helsinki to 5.127 euros.

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ESPOO (dpa-AFX)

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