2010-01-28 12:06:00 CET
2010-01-28 12:06:10 CET
REGULATED INFORMATION
Nokia - Financial Statement Release
Nokia Q4 2009 net sales EUR 12.0 billion, non-IFRS EPS EUR 0.25 (reported EPS EUR 0.26)
Nokia Corporation
Interim Report
January 28, 2010 at 13.00 (CET+1)
Nokia Q4 2009 net sales EUR 12.0 billion, non-IFRS EPS EUR 0.25 (reported EPS
EUR 0.26)
Nokia 2009 net sales EUR 41.0 billion, non-IFRS EPS EUR 0.66 (reported EPS EUR
0.24)
Nokia Board of Directors will propose a dividend of EUR 0.40 per share for 2009
(EUR 0.40 per share for 2008)
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| Non-IFRS fourth quarter 2009 results1 | | Non-IFRS full year 2009 |
| | | results1, 2 |
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| EUR | Q4/ | Q4/ | YoY | Q3/ | QoQ | | 2009 | 2008 | YoY |
| millio | 2009 | 2008 | Chang | 2009 | Chan | | | | Change |
| n | | | e | | ge | | | | |
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| Net | 11 | 12 | -5.3% | 9 810 | 22.2 | | 40 987 | 50 722 | -19.2% |
| sales | 988 | 665 | | | % | | | | |
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| Device | 8 179 | 8 141 | 0.5% | 6 915 | 18.3 | | 27 853 | 35 099 | -20.6% |
| s & | | | | | % | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | 225 | 206 | 9.2% | 166 | 35.5 | | 673 | 363 | |
| | | | | | % | | | | |
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| Nokia | 3 625 | 4 340 | -16.5 | 2 760 | 31.3 | | 12 574 | 15 319 | -17.9% |
| Siemen | | | % | | % | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| Operat | 1 473 | 1 239 | 18.9% | 741 | 98.8 | | 3 503 | 7 033 | -50.2% |
| ing | | | | | % | | | | |
| profit | | | | | | | | | |
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| Device | 1257 | 983 | 27.9% | 787 | 59.7 | | 3 488 | 6 373 | -45.3% |
| s & | | | | | % | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | 54 | 53 | 1.9% | 43 | 25.6 | | 121 | 82 | |
| | | | | | % | | | | |
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| Nokia | 201 | 225 | -10.7 | -53 | | | 28 | 757 | -96.3% |
| Siemen | | | % | | | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| Operat | 12.3% | 9.8% | | 7.6% | | | 8.5% | 13.9% | |
| ing | | | | | | | | | |
| margin | | | | | | | | | |
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| Device | 15.4% | 12.1% | | 11.4% | | | 12.5% | 18.2% | |
| s & | | | | | | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | 24.0% | 25.7% | | 25.9% | | | 18.0% | 22.6% | |
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| Nokia | 5.5% | 5.2% | | -1.9% | | | 0.2% | 4.9% | |
| Siemen | | | | | | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| EPS, | 0.25 | 0.26 | -3.8% | 0.17 | 47.1 | | 0.66 | 1.34 | -50.7% |
| EUR | | | | | % | | | | |
| Dilute | | | | | | | | | |
| d | | | | | | | | | |
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| Reported fourth quarter 2009 results | | Reported full year 2009 |
| | | results2 |
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| EUR | Q4/20 | Q4/20 | YoY | Q3/ | QoQ | | 2009 | 2008 | YoY |
| millio | 09 | 08 | Chang | 2009 | Chan | | | | Change |
| n | | | e | | ge | | | | |
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| Net | 11 | 12 | -5.3% | 9 810 | 22.2 | | 40 984 | 50 710 | -19.2% |
| sales | 988 | 662 | | | % | | | | |
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| Device | 8 179 | 8 141 | 0.5% | 6 915 | 18.3 | | 27 853 | 35 099 | -20.6% |
| s & | | | | | % | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | 225 | 205 | 9.8% | 166 | 35.5 | | 670 | 361 | |
| | | | | | % | | | | |
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| Nokia | 3 625 | 4 338 | -16.4 | 2 760 | 31.3 | | 12 574 | 15 309 | -17.9% |
| Siemen | | | % | | % | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| Operat | 1 141 | 492 | 131.9 | -426 | | | 1 197 | 4 966 | -75.9% |
| ing | | | % | | | | | | |
| profit | | | | | | | | | |
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| Device | 1 219 | 766 | 59.1% | 785 | 55.3 | | 3 314 | 5 816 | -43.0% |
| s & | | | | | % | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | -56 | -73 | | -68 | | | -344 | -153 | |
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| Nokia | 17 | -179 | | -1 | | | -1 639 | -301 | |
| Siemen | | | | 107 | | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| Operat | 9.5% | 3.9% | | -4.3% | | | 2.9% | 9.8% | |
| ing | | | | | | | | | |
| margin | | | | | | | | | |
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| Device | 14.9% | 9.4% | | 11.4% | | | 11.9% | 16.6% | |
| s & | | | | | | | | | |
| Servic | | | | | | | | | |
| es | | | | | | | | | |
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| NAVTEQ | -24.9 | -35.6 | | -41.0 | | | -51.3% | -42.4% | |
| | % | % | | % | | | | | |
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| Nokia | 0.5% | -4.1% | | -40.1 | | | -13.0% | -2.0% | |
| Siemen | | | | % | | | | | |
| s | | | | | | | | | |
| Networ | | | | | | | | | |
| ks | | | | | | | | | |
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| | | | | | | | | | |
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| EPS, | 0.26 | 0.15 | 73.3% | -0.15 | | | 0.24 | 1.05 | -77.1% |
| EUR | | | | | | | | | |
| Dilute | | | | | | | | | |
| d | | | | | | | | | |
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Note 1 relating to non-IFRS results: Non-IFRS results exclude special items for
all periods. In addition, non-IFRS results exclude intangible asset
amortization, other purchase price accounting related items and inventory value
adjustments arising from i) the formation of Nokia Siemens Networks and ii) all
business acquisitions completed after June 30, 2008. More specific information
about the exclusions from the non-IFRS results may be found in this press
release on pages 3-4, 12-14 and 16 for the quarterly periods and pages 25-29 for
the full year 2009 and 2008.
Nokia believes that these non-IFRS financial measures provide meaningful
supplemental information to both management and investors regarding Nokia's
performance by excluding the above-described items that may not be indicative of
Nokia's business operating results. These non-IFRS financial measures should not
be viewed in isolation or as substitutes to the equivalent IFRS measure(s), but
should be used in conjunction with the most directly comparable IFRS measure(s)
in the reported results. A reconciliation of the non-IFRS results to our
reported results for Q4 2009 and Q4 2008 as well as for full year 2009 and 2008
can be found in the tables on pages 10, 12-16 and 24-29 of this press release. A
reconciliation of our Q3 2009 non-IFRS results can be found on pages 11 and
14-18 of our Q3 2009 Interim Report of October 15, 2009.
Note 2 relating to NAVTEQ: Nokia completed the acquisition of NAVTEQ Corporation
on July 10, 2008. NAVTEQ is a separate reportable segment of Nokia starting from
the third quarter 2008. The results of NAVTEQ are not available for the prior
periods. Accordingly, the results of Nokia Group and NAVTEQ for the full year
2009 are not directly comparable to the results for the full year 2008.
FOURTH QUARTER 2009 HIGHLIGHTS
- Nokia net sales of EUR 12.0 billion, down 5% year on year and up 22%
sequentially (down 4% and up 20% at constant currency).
- Devices & Services net sales of EUR 8.2 billion, up 0.5% year on year and up
18% sequentially (up 2% and 16% at constant currency).
- Services net sales of EUR 169 million, up 15% sequentially; billings of EUR
226 million, up 31% sequentially.
- Estimated industry mobile device volumes of 329 million units, up 8% year on
year and up 14% sequentially.
- Nokia mobile device volumes of 126.9 million units, up 12% year on year and up
17% sequentially.
- Nokia estimated mobile device market share of 39% in Q4 2009, up from an
estimated 37% in Q4 2008 and 38% in Q3 2009. The full year 2009 estimated market
share was 38%, down from 39% in 2008.
- Nokia grew its converged device market share to an estimated 40%, from an
estimated 35% in Q3 2009.
- Nokia improved the ASP of its mobile devices to EUR 63, from EUR 62 in Q3
2009.
- Devices & Services increased its gross margin to 34.3%, from 30.9% in Q3 2009.
- NAVTEQ non-IFRS net sales of EUR 225 million, up 9% year on year and up 36%
sequentially, and non-IFRS operating margin of 24.0%, down from 25.9% in Q3
2009.
- Nokia Siemens Networks net sales of EUR 3.6 billion, down 16% year on year and
up 31% sequentially (down 17% and up 29% at constant currency).
- Nokia operating cash flow of EUR 1.5 billion, more than double the operating
cash flow for Q3 2009.
- Total cash and other liquid assets of EUR 8.9 billion at the end of Q4 2009.
- Nokia taxes were unfavorably impacted by Nokia Siemens Networks taxes as no
tax benefits are recognized for certain Nokia Siemens Networks deferred tax
items. If Nokia's estimated long-term tax rate of 26% had been applied, non-IFRS
Nokia EPS would have been approximately 1 Euro cent higher.
OLLI-PEKKA KALLASVUO, NOKIA CEO: "We grew our market share in smartphones in the fourth quarter, driven by the
successful launch of new touch and QWERTY models. Our performance in
smartphones, combined with continuing success in the emerging markets, helped us
increase sales in our Devices & Services unit, both quarter-on-quarter and
year-on-year. Our solid results also owe a good deal to world class supply chain
management and impressive sales execution.
I was also pleased with Nokia Siemens Networks' performance in Q4, especially
considering the ongoing challenging conditions in the infrastructure market.
That performance enabled it to turn in a full year profit on an operative basis.
Our focus remains firmly on execution, especially around user experience. Here I
want to highlight our move to shake up the navigation market with free walk and
drive navigation on our smartphones, a good example of how we are leveraging our
assets to bring real benefits to consumers."
INDUSTRY AND NOKIA OUTLOOK
- Nokia expects Devices & Services net sales to be between EUR 6.5 billion and
EUR 7.0 billion in the first quarter 2010.
- Nokia expects its non-IFRS operating margin in Devices & Services in the first
quarter 2010 to be negatively impacted by seasonality and to be at the lower end
of the range of its full year 2010 target, which continues to be 12% to 14%.
- Nokia and Nokia Siemens Networks expect Nokia Siemens Networks' net sales to
be between EUR 2.6 billion and EUR 2.9 billion in the first quarter 2010.
- Nokia and Nokia Siemens Networks expect the non-IFRS operating margin in Nokia
Siemens Networks in the first quarter 2010 to be negatively impacted by
seasonality and to be below the full year 2010 target, which continues to be
breakeven to 2%.
- Nokia continues to expect industry mobile device volumes to be up
approximately 10% in 2010, compared to 2009.
- Nokia continues to target its mobile device volume market share to be flat in
2010, compared to 2009.
- Nokia continues to target to increase its mobile device value market share
slightly in 2010, compared to 2009.
- Nokia continues to target non-IFRS operating expenses in Devices & Services of
approximately EUR 5.7 billion in 2010.
- Nokia and Nokia Siemens Networks continue to expect a flat market in euro
terms for the mobile and fixed infrastructure and related services market in
2010, compared to 2009.
- Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks to
grow faster than the market in 2010.
- Nokia and Nokia Siemens Networks continue to target Nokia Siemens Networks to
reduce its non-IFRS annualized operating expenses and production overheads by
EUR 500 million by the end of 2011, compared to the end of 2009.
FOURTH QUARTER 2009 FINANCIAL HIGHLIGHTS
(Comparisons are given to the fourth quarter 2008 results, unless otherwise
indicated.)
The non-IFRS results exclusions
Q4 2009 - EUR 332 million (net) consisting of:
- EUR 89 million restructuring charge and other one-time items in Nokia Siemens
Networks
- EUR 22 million gain on sale of real estate in Nokia Siemens Networks
- EUR 36 million restructuring charge in Devices & Services
- EUR 117 million of intangible asset amortization and other purchase price
accounting related items arising from the formation of Nokia Siemens Networks
- EUR 110 million of intangible asset amortization and other purchase price
accounting related items arising from the acquisition of NAVTEQ
- EUR 2 million of intangible assets amortization and other purchase price
related items arising from the acquisition of OZ Communications in Devices &
Services
Q4 2009 taxes - EUR 213 million non-cash positive effect from development and
outcome of various prior year items impacting Nokia taxes
Q3 2009 - EUR 1 167 million consisting of:
- EUR 908 million impairment of goodwill in Nokia Siemens Networks
- EUR 29 million restructuring charge and other one-time items in Nokia Siemens
Networks
- EUR 117 million of intangible assets amortization and other purchase price
related items arising from the formation of Nokia Siemens Networks
- EUR 111 million of intangible assets amortization and other purchase price
related items arising from the acquisition of NAVTEQ
- EUR 2 million of intangible assets amortization and other purchase price
related items arising from the acquisition of OZ Communications in Devices &
Services
Q3 2009 taxes - EUR 432 million valuation allowance for Nokia Siemens Networks
deferred tax assets impacting Nokia taxes
Q4 2008 - EUR 747 million consisting of:
- EUR 286 million restructuring charge and other one-time items in Nokia Siemens
Networks
- EUR 52 million restructuring charge in Devices & Services
- EUR 165 million representing the contribution of assets to Symbian Foundation
- EUR 5 million restructuring charge in NAVTEQ
- EUR 118 million of intangible asset amortization and other purchase price
accounting related items arising from the formation of Nokia Siemens Networks
- EUR 121 million of intangible asset amortization and other purchase price
accounting related items arising from the acquisition of NAVTEQ
Non-IFRS results exclude special items for all periods. In addition, non-IFRS
results exclude intangible asset amortization, other purchase price accounting
related items and inventory value adjustments arising from i) the formation of
Nokia Siemens Networks and ii) all business acquisitions completed after June
30, 2008.
Nokia Group
Nokia's fourth quarter 2009 net sales decreased 5% to EUR 12.0 billion, compared
with EUR 12.7 billion in the fourth quarter 2008. At constant currency, group
net sales would have decreased 4% year on year.
The following chart sets out the year on year and sequential growth rates in our
net sales on a reported basis and at constant currency for the periods
indicated.
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| FOURTH QUARTER 2009 NET SALES, REPORTED & CONSTANT CURRENCY1 |
--------------------------------------------------------------------------------
| | Q4/2009 vs.Q4/2008 | Q4/2009 vs.Q3/2009 |
| | Change | Change |
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| Group net sales - reported | -5% | 22% |
--------------------------------------------------------------------------------
| Group net sales - constant | -4% | 20% |
| currency1 | | |
--------------------------------------------------------------------------------
| | | |
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| Devices & Services net sales - | 0.5% | 18% |
| reported | | |
--------------------------------------------------------------------------------
| Devices & Services net sales - | 2% | 16% |
| constant currency1 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Nokia Siemens Networks net sales | -16% | 31% |
| - reported | | |
--------------------------------------------------------------------------------
| Nokia Siemens Networks net sales | -17% | 28% |
| - constant currency1 | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Note 1: Change in net sales at constant currency excludes |
| the impact of changes in exchange rates in comparison to the |
| Euro, our reporting currency. |
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Nokia's fourth quarter 2009 reported operating profit increased 132% to EUR 1.1
billion, compared with EUR 492 million in the fourth quarter 2008. Nokia's
fourth quarter 2009 non-IFRS operating profit increased 19% to EUR 1.5 billion,
compared with EUR 1.2 billion in the fourth quarter 2008. Nokia's fourth quarter
2009 reported operating margin was 9.5% (3.9%). Nokia's fourth quarter 2009
non-IFRS operating margin was 12.3% (9.8%).
Operating cash flow for the fourth quarter 2009 was EUR 1.5 billion. The
operating cash flow for the fourth quarter 2008 was negative EUR 0.3 billion.
Operating cash flow in the fourth quarter 2008 included a one-time EUR 1.7
billion lump-sum cash payment made to Qualcomm as part of a license agreement.
Total cash and other liquid assets were EUR 8.9 billion at December 31, 2009,
compared with EUR 6.8 billion at December 31, 2008. At December 31, 2009,
Nokia's net debt-equity ratio (gearing) was -25%, compared with -14% at December
31, 2008.
Devices & Services
In the fourth quarter 2009, the total mobile device volumes of Devices &
Services were 126.9 million units, representing an increase of 12% year on year
and 17% sequentially. The overall industry mobile device volumes for the same
period were 329 million units based on Nokia's estimate, representing an
increase of 8% year on year and 14% sequentially.
Of the total industry mobile device volumes, converged mobile device industry
volumes in the fourth quarter 2009 increased to 52.4 million units, based on
Nokia's estimate, compared with an estimated 47.0 million units in the third
quarter 2009. Our own converged mobile device volumes, comprising our
smartphones and mobile computers, were 20.8 million units in the fourth quarter
2009, compared with 15.1 million units in the fourth quarter 2008 and 16.4
million units in the third quarter 2009. Nokia's share of the converged mobile
device market was an estimated 40% in the fourth quarter 2009, up from an
estimated 35% in the third quarter 2009.
We shipped approximately 4.6 million Nokia Nseries and approximately 6.1 million
Nokia Eseries devices during the fourth quarter 2009, up from the combined 8.9
million Nseries and Eseries devices we shipped in the third quarter 2009.
The following chart sets out our mobile device volumes for the periods
indicated, as well as the year on year and sequential growth rates, by
geographic area.
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| NOKIA MOBILE DEVICE VOLUME BY GEOGRAPHIC AREA | | |
--------------------------------------------------------------------------------
| (million units) | Q4/2009 | Q4/2008 | YoY | Q3/2009 | QoQ Change |
| | | | Change | | |
--------------------------------------------------------------------------------
| Europe | 34.3 | 34.7 | -1.2% | 27.1 | 26.6% |
--------------------------------------------------------------------------------
| Middle East & | 24.3 | 18.2 | 33.5% | 19.6 | 24.0% |
| Africa | | | | | |
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| Greater China | 17.6 | 12.9 | 36.4% | 18.5 | -4.9% |
--------------------------------------------------------------------------------
| Asia-Pacific | 34.5 | 29.9 | 15.4% | 30.5 | 13.1% |
--------------------------------------------------------------------------------
| North America | 3.8 | 4.1 | -7.3% | 3.1 | 22.6% |
--------------------------------------------------------------------------------
| Latin America | 12.4 | 13.3 | -6.8% | 9.7 | 27.8% |
--------------------------------------------------------------------------------
| Total | 126.9 | 113.1 | 12.2% | 108.5 | 17.0% |
--------------------------------------------------------------------------------
Based on our preliminary market estimate, Nokia's mobile device market share for
the fourth quarter 2009 was 39%, compared with 37% in the fourth quarter 2008
and 38% in the third quarter 2009. Our year on year market share increase was
driven by higher market share in all regions except North America, where our
market share was flat. Our sequential market share increase was driven primarily
by higher market share in Asia-Pacific, Middle East & Africa, Europe and North
America. Our market share was sequentially down in Greater China and Latin
America.
Our mobile device average selling price (ASP) in the fourth quarter 2009 was EUR
63, down from EUR 71 in the fourth quarter 2008 and up from EUR 62 in the third
quarter 2009. The lower year on year ASP was primarily due to price erosion, a
higher proportion of lower-priced entry level device sales and to a lesser
extent unfavorable changes in foreign exchange rates. On a sequential basis, our
ASP benefited from more favorable foreign exchange hedging results and a
positive mix shift towards converged mobile devices. Our mobile device ASP above
excludes net sales from services.
Fourth quarter 2009 Devices & Services net sales increased 0.5% to EUR 8.2
billion, compared with EUR 8.1 billion in the fourth quarter 2008. At constant
currency, Devices & Services net sales would have increased 2%. Net sales grew
year on year in Greater China, Middle East & Africa and Asia-Pacific. Net sales
were down year on year in Europe, Latin America and North America. The slight
net sales increase resulted primarily from higher volumes in several regions,
driven by stronger demand, largely offset, however, by an ASP decline compared
to the fourth quarter 2008. Of our total Devices & Services net sales, services
contributed EUR 169 million in the fourth quarter 2009 and were up 15%
sequentially. Services billings in the fourth quarter 2009 were EUR 226
million, up 31% sequentially.
The following chart sets out our Devices & Services net sales and ASP for the
periods indicated by product category.
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| DEVICES & SERVICES NET SALES AND ASP BY OPERATING MODE |
--------------------------------------------------------------------------------
| | Net sales, EUR | ASP, EUR | |
| | billion | | |
--------------------------------------------------------------------------------
| | Q4/2009 | Q3/2009 | Q4/2009 | Q3/2009 | |
--------------------------------------------------------------------------------
| Mobile phones1 | 4.3 | 3.8 | 40 | 41 | |
--------------------------------------------------------------------------------
| Converged mobile | 3.9 | 3.1 | 186 | 190 | |
| devices2 | | | | | |
--------------------------------------------------------------------------------
| Total | 8.2 | 6.9 | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Note 1: Series 30 and Series 40-powered devices ranging from basic mobile |
| phones focused on voice capability to devices with a number of additional |
| functionalities, such as Internet connectivity, including the services and |
| accessories sold with them. |
--------------------------------------------------------------------------------
| Note 2: Smartphones and mobile computers, including the services and |
| accessories sold with them. |
--------------------------------------------------------------------------------
Devices & Services reported gross profit and non-IFRS gross profit increased 2%
to EUR 2.81 billion, compared with EUR 2.75 billion in the fourth quarter 2008,
with a reported gross margin and non-IFRS gross margin of 34.3% (33.8%). The
year on year gross margin increase was primarily due to favorable developments
in product material costs and royalty income as well as changes in product mix
offset to a large extent by unfavorable changes in foreign exchange rates.
Devices & Services reported operating profit increased 59% to EUR 1.2 billion,
compared with EUR 766 million in the fourth quarter 2008, with a reported
operating margin of 14.9% (9.4%). Devices & Services non-IFRS operating profit
increased 28% to EUR 1.3 billion, compared with EUR 983 million in the fourth
quarter 2008, with a non-IFRS operating margin of 15.4% (12.1%). The 28% year on
year increase in non-IFRS operating profit for the fourth quarter 2009 was
driven primarily by lower operating and other expenses.
NAVTEQ
Fourth quarter 2009 NAVTEQ reported net sales increased 10% year on year to EUR
225 million, compared with EUR 205 million in the fourth quarter 2008,
benefiting from growth in mobile devices and improved conditions in the
automotive industry. In the fourth quarter 2009, NAVTEQ's reported gross profit
increased to EUR 195 million, compared with EUR 180 million in the fourth
quarter 2008, with a gross margin of 86.7% (87.8%). Non-IFRS gross profit was
EUR 196 million (EUR 181 million), with a non-IFRS gross margin of 87.1%
(87.9%). In the fourth quarter 2009, NAVTEQ's reported operating loss decreased
to EUR 56 million, compared with a EUR 73 million loss in the fourth quarter
2008. The reported operating margin was -24.9% (-35.6%). NAVTEQ non-IFRS
operating profit was EUR 54 million (EUR 53 million), with a non-IFRS operating
margin of 24.0% (25.7%).
Nokia Siemens Networks
Fourth quarter 2009 net sales decreased 16% to EUR 3.6 billion, compared with
EUR 4.3 billion in the fourth quarter 2008, reflecting challenging competitive
factors and market conditions. At constant currency, Nokia Siemens Networks net
sales would have decreased 17%. Of total Nokia Siemens Networks net sales,
services contributed EUR 1.7 billion in the fourth quarter 2009.
The following chart sets out Nokia Siemens Networks net sales for the periods
indicated, as well as the year on year and sequential growth rates, by
geographic area.
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| NOKIA SIEMENS NETWORKS NET SALES BY GEOGRAPHIC AREA |
--------------------------------------------------------------------------------
| EUR million | Q4/2009 | Q4/2008 | YoY Change | Q3/2009 | QoQ Change |
--------------------------------------------------------------------------------
| Europe | 1 327 | 1 636 | -18.9% | 1 062 | 25.0% |
--------------------------------------------------------------------------------
| Middle East & | 371 | 615 | -39.7% | 387 | -4.1% |
| Africa | | | | | |
--------------------------------------------------------------------------------
| Greater China | 425 | 409 | 3.9% | 335 | 26.9% |
--------------------------------------------------------------------------------
| Asia-Pacific | 818 | 967 | -15.4% | 567 | 44.3% |
--------------------------------------------------------------------------------
| North America | 244 | 198 | 23.2% | 127 | 92.1% |
--------------------------------------------------------------------------------
| Latin America | 440 | 513 | -14.2% | 282 | 56.0% |
--------------------------------------------------------------------------------
| Total | 3 625 | 4 338 | -16.4% | 2 760 | 31.3% |
--------------------------------------------------------------------------------
Nokia Siemens Networks reported gross profit decreased 5% to EUR 1.07 billion,
compared with EUR 1.13 billion in the fourth quarter 2008, with a gross margin
of 29.5% (26.1%). Nokia Siemens Networks non-IFRS gross profit decreased 16% to
EUR 1.1 billion, compared with EUR 1.3 billion in the fourth quarter 2008, with
a non-IFRS gross margin of 30.6% (30.4%). The lower year on year non-IFRS gross
profit in the fourth quarter 2009 was due primarily to lower year on year net
sales.
Nokia Siemens Networks fourth quarter 2009 reported operating profit was EUR 17
million, compared with a reported operating loss of EUR 179 million in the
fourth quarter 2008, with a reported operating margin of 0.5%
(-4.1%). Nokia Siemens Networks non-IFRS operating profit decreased 11% to EUR
201 million in the fourth quarter 2009, compared with EUR 225 million in the
fourth quarter 2008, with a non-IFRS operating margin of 5.5% (5.2%). The year
on year decrease in Nokia Siemens Networks non-IFRS operating profit primarily
reflected lower net sales offset to a large extent by lower operating expenses.
In November 2009, Nokia Siemens Networks announced a reorganization of its
business structure to align it better to customer needs. At the same time, Nokia
Siemens Networks announced a plan to improve its financial performance, which
include targeted reductions of annualized operating expenses and production
overheads of EUR 500 million by the end of 2011, compared to the end of 2009, on
a non-IFRS basis. As part of that effort, the company is conducting a global
personnel review which may lead to headcount reductions in the range of about 7%
to 9% of its approximately 64 000 employees. Nokia Siemens Networks estimated
that total charges associated with these reductions will be in the range of EUR
550 million to be recorded mainly over the course of 2010. No charges associated
with these reductions were recorded for the fourth quarter 2009. In addition to
the operating expense and production overhead savings, Nokia Siemens Networks
announced that it will target an annual reduction in product and service
procurement costs related to cost of goods sold that is substantially larger
than the targeted EUR 500 million in operating expenses and production overhead
reductions.
Q4 2009 OPERATING HIGHLIGHTS
Devices & Services
- Nokia introduced the Nokia 1616, Nokia 1800, Nokia 2220 slide and Nokia 2690,
all affordable mobile devices that support Nokia Life Tools, a service through
which consumers can access timely and relevant agricultural information, as well
as education and entertainment services, without requiring the use of GPRS or
Internet connectivity. During the fourth quarter, Nokia launched Nokia Life
Tools in Indonesia.
- Nokia commenced shipments of the Nokia X6, a powerful touch smartphone with 32
GB of on-board memory that comes in combination with Comes With Music, Nokia's
‘all-you-can-eat' music offering.
- Nokia continued to expand Comes With Music, with the offering launching in
Netherlands, Finland, Spain and Russia. In Russia, Nokia also launched Ovi
Music, representing the first step of its plan to bring Nokia Music Store—our
22-strong chain of digital music stores—into the Ovi stable of services.
- Nokia commenced shipments of the Nokia N97 mini, a smaller companion to the
Nokia N97, featuring a tilting 3.2" touch display, QWERTY keyboard and fully
customizable homescreen.
- Nokia continued to develop Ovi Maps, its mapping and navigation service. In
January 2010, Nokia introduced a new version of Ovi Maps for its smartphones
that includes high-end walk and drive navigation at no extra cost, available for
download at www.nokia.com/maps. The new version of Ovi Maps includes high-end
car and pedestrian navigation features, such as turn-by-turn voice guidance for
74 countries, in 46 languages, and traffic information for more than 10
countries, as well as detailed maps for more than 180 countries.
- Ovi Store, Nokia's one-stop shop for applications and content, continued to
grow, with the store now attracting more than 1 million downloads a day.
- Nokia commenced shipments of the Nokia E72, a device designed especially for
business use and messaging, and featuring a full QWERTY keyboard, a 5 megapixel
camera and assisted GPS. The Nokia E72 is one of many Nokia mobile devices
supporting Nokia Messaging, Nokia's email service, which continued to gain
traction. Nokia Messaging is now available to Nokia users in more than 100
countries and more than 2 million users are now registered.
- Nokia continued to expand Ovi Mail, a free email service designed especially
for users in emerging markets with Internet-enabled devices. The service can be
set up and accessed without ever needing a PC. More than 5 million accounts have
been activated since Ovi Mail was launched in late 2008.
- Nokia commenced shipments of the Nokia N900, a handset that delivers
computer-grade performance in a compact QWERTY and touch form factor. The Nokia
N900 runs on Maemo, a desktop PC-like software architecture based on open source
Linux, and which Nokia is continuing to develop.
- Nokia commenced shipments of the Nokia Booklet 3G, a new Windows 7-based
mini-laptop, built for all-day mobility and connectivity. Encased in an
ultra-portable aluminum chassis, the Nokia Booklet 3G runs for up to 12 hours on
a single charge and has a broad range of connectivity options.
- As part of its global efforts to align its research and development (R&D)
operations with its focused portfolio of future products, Nokia announced plans
to reduce its R&D activities in Japan, as well as some of its R&D activities in
Finland and Denmark.
- Nokia filed a complaint against Apple with the Federal District Court in
Delaware, alleging that Apple's iPhone infringes Nokia patents for GSM, UMTS and
wireless LAN (WLAN) standards. Nokia also announced that it filed a complaint
with the United States International Trade Commission (ITC) alleging that Apple
infringes Nokia patents in virtually all of its mobile phones, portable music
players, and computers. In January 2010, the ITC confirmed that it will commence
an investigation based on the complaint by Nokia.
NAVTEQ
− NAVTEQ announced the North American availability of Motorway Junction Objects,
which enables navigation systems to display full 3D animation of complex
junctions, with coverage of over 2 000 locations.
− NAVTEQ launched full coverage maps of both Iceland and Croatia.
− NAVTEQ announced that NAVTEQ LocationPoint™, the company's location-based
advertising service for mobile applications, has been selected by AAA and Loopt
for their respective applications to deliver users with location-relevant
promotions and coupons for local merchants.
− NAVTEQ announced a global technology agreement with Microsoft to allow the
rapid deployment of innovative collection capabilities, as well as accelerating
the collection, creation and storage of 3D map data and visuals.
− NAVTEQ signed a global agreement with ALK to supply map data and content for
the company's CoPilot®Live™ GPS navigation products.
Nokia Siemens Networks
- Nokia Siemens Networks won 10 new 3G contracts including deals with Softbank
in Japan for HSPA+ for evolved mobile data services delivery and with Telenor
Sweden for a full upgrade of its 3G network as well as a contract with VMS
Mobifone in Vietnam for a 3G network roll-out.
- Nokia Siemens Networks was selected by Telenor Denmark for a full upgrade of
2G and 3G radio networks for nationwide EDGE and HSPA/HSPA+ services in a deal
that also includes the future provision of LTE.
- Nokia Siemens Networks maintained its momentum in LTE development using
standards compliant software and commercial hardware. The company made the
world's first LTE handover on fully standards compliant software in October, and
announced it will be conducting interoperability tests with four leading device
vendors in different regions. In TD-LTE, Nokia Siemens Networks made the first
3GPP standard compliant TD-LTE call.
- Nokia Siemens Networks continued to make progress in Managed Services, signing
new deals with Zain in Nigeria and East Africa and Unitech Wireless in India.
- Nokia Siemens Networks announced several business solutions deals including a
device management contract with IDEA Cellular in India and a charge@once
convergent billing solution with leo in Namibia. In November, Nokia Siemens
Networks was awarded an Identity Data Management contract by Telefonica's
Argentina mobile operation ‘Movistar', which will enable the operator to offer
their nearly 16 million end-users network-enhanced single-sign on and other
features that improve online navigation.
- Nokia Siemens Networks launched a comprehensive range of energy solutions for
telecoms operators, designed to reduce network operating costs, by lowering
network power consumption and exploiting more efficient technology and renewable
energy. Telenor Pakistan adopted the Off-Grid Site solution, using solar energy
to power communications for rural customers.
- Nokia Siemens Networks has responded to the increased focus on environmental
responsibility, demand for renewable energy, intelligent power grids, and smart
meters, by announcing the intent to provide smart grid solutions for the energy
sector using its existing charging, mediation, service management and network
management solutions. It also provided a software platform for ServusNet, upon
which the Irish software group has been able to build a solution for wind farm
management.
For more information on the operating highlights mentioned above, please refer
to related press announcements at the following links:
http://www.nokia.com/press, http://www.navteq.com/about/press.html,
http://www.nokiasiemensnetworks.com/press
NOKIA IN THE FOURTH QUARTER 2009
(The following discussion is of Nokia's reported results. Comparisons are given
to the fourth quarter 2008 results, unless otherwise indicated.)
Nokia's net sales decreased 5% to EUR 11 988 million (EUR 12 662 million). Net
sales of Devices & Services increased 0.5% to EUR 8 179 million (EUR 8 141
million). Net sales of NAVTEQ increased 10% to EUR 225 million (EUR 205
million). Net sales of Nokia Siemens Networks decreased 16% to EUR 3 625 million
(EUR 4 338 million).
Operating profit increased 132% to EUR 1 141 million (EUR 492 million),
representing an operating margin of 9.5% (3.9%). Operating profit in Devices &
Services increased 59% to EUR 1 219 million (EUR 766 million), representing an
operating margin of 14.9% (9.4%). Operating loss in NAVTEQ was EUR 56 million
(operating loss EUR 73 million), representing an operating margin of -24.9%
(-35.6%). Operating profit in Nokia Siemens Networks was EUR 17 million
(operating loss EUR 179 million), representing an operating margin of 0.5%
(-4.1%). Group Common Functions reported expense totaled EUR 39 million (EUR 22
million).
In the period from October to December 2009, net financial expense was EUR 79
million (EUR 16 million). Profit before tax and minority interests was EUR 1 063
million (EUR 476 million). In Q4 2009, Nokia taxes benefited from the positive
effect from the development and outcome of various prior year items impacting
Nokia taxes. In Q4 2008, Nokia taxes benefited from Nokia obtaining a favorable
high tech qualification assessment in China as well as certain tax benefits from
prior years. Profit was EUR 882 million (EUR 551 million), based on a profit of
EUR 948 million (EUR 576 million) attributable to equity holders of the parent
and a negative EUR 66 million (negative EUR 25 million) attributable to minority
interests. Earnings per share increased to EUR 0.26 (basic) and to EUR 0.26
(diluted), compared with EUR 0.16 (basic) and EUR 0.15 (diluted) in the fourth
quarter of 2008.
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| |
--------------------------------------------------------------------------------
| | Reported | Reported | | Non-IFRS | Non-IFRS |
| | 10-12/2009 | 10-12/200 | | 10-12/2009 | 10-12/2008 |
| | | 8 | | | |
--------------------------------------------------------------------------------
| Net sales | 11 988 | 12 662 | | 11 988 | 12 665 |
--------------------------------------------------------------------------------
| Cost of sales | -7 915 | -8 599 | | -7 877 | -8 415 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Gross profit | 4 073 | 4 063 | | 4 111 | 4 250 |
--------------------------------------------------------------------------------
| Research and | -1 565 | -1 731 | | -1 404 | -1 400 |
| development expenses | | | | | |
--------------------------------------------------------------------------------
| Selling and | -1 048 | -1 287 | | -945 | -1 185 |
| marketing expenses | | | | | |
--------------------------------------------------------------------------------
| Administrative and | -294 | -345 | | -278 | -284 |
| general expenses | | | | | |
--------------------------------------------------------------------------------
| Impairment of | - | - | | - | - |
| goodwill | | | | | |
--------------------------------------------------------------------------------
| Other income | 99 | 154 | | 77 | 154 |
--------------------------------------------------------------------------------
| Other expenses | -124 | -362 | | -88 | -296 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 1 141 | 492 | | 1 473 | 1 239 |
--------------------------------------------------------------------------------
| Share of results of | 1 | - | | 1 | - |
| associated companies | | | | | |
--------------------------------------------------------------------------------
| Financial income and | -79 | -16 | | -79 | -16 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit before tax | 1 063 | 476 | | 1 395 | 1 223 |
--------------------------------------------------------------------------------
| Tax | -181 | 75 | | -459 | -142 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit | 882 | 551 | | 936 | 1 081 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit attributable | 948 | 576 | | 912 | 958 |
| to equity holders of | | | | | |
| the parent | | | | | |
--------------------------------------------------------------------------------
| Profit/loss | -66 | -25 | | 24 | 123 |
| attributable to | | | | | |
| minority interests | | | | | |
--------------------------------------------------------------------------------
| | 882 | 551 | | 936 | 1 081 |
--------------------------------------------------------------------------------
| Earnings per share, EUR |
| (for profit attributable to the equity holders of the parent) |
--------------------------------------------------------------------------------
| Basic | 0.26 | 0.16 | | 0.25 | 0.26 |
--------------------------------------------------------------------------------
| Diluted | 0.26 | 0.15 | | 0.25 | 0.26 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Average number of | | | | | |
| shares (1 000 | | | | | |
| shares) | | | | | |
--------------------------------------------------------------------------------
| Basic | 3 708 113 | 3 697 553 | | 3 708 113 | 3 697 553 |
--------------------------------------------------------------------------------
| Diluted | 3 713 778 | 3 724 043 | | 3 713 778 | 3 724 043 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Depreciation and | 451 | 446 | | 222 | 207 |
| amortization, total | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Share-based | 14 | -60 | | 14 | -60 |
| compensation | | | | | |
| expense, total | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOKIA NET SALES BY GEOGRAPHIC AREA, EUR million |
--------------------------------------------------------------------------------
| (10-12/2009, 10-12/2008 and 1-12/2008 unaudited, 1-12/2008 audited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Reported | 10-12/2 | Y-o-Y | 10-12/20 | 1-12/20 | Y-o-Y | 1-12/20 |
| | 009 | change, | 08 | 09 | change, % | 08 |
| | | % | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Europe | 4 543 | -15 | 5 347 | 14 790 | -22 | 18 842 |
--------------------------------------------------------------------------------
| Middle-East | 1 528 | -4 | 1 584 | 5 605 | -23 | 7 265 |
| & Africa | | | | | | |
--------------------------------------------------------------------------------
| Greater | 1 668 | 21 | 1 374 | 6 429 | - | 6 420 |
| China | | | | | | |
--------------------------------------------------------------------------------
| Asia-Pacific | 2 606 | 7 | 2 444 | 8 967 | -21 | 11 344 |
--------------------------------------------------------------------------------
| North | 602 | 5 | 571 | 2 061 | - | 2 068 |
| America | | | | | | |
--------------------------------------------------------------------------------
| Latin | 1 041 | -22 | 1 342 | 3 132 | -34 | 4 771 |
| America | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total | 11 988 | -5 | 12 662 | 40 984 | -19 | 50 710 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOKIA PERSONNEL BY GEOGRAPHIC AREA | |
--------------------------------------------------------------------------------
| | 31.12.09 | Y-o-Y | 31.12.08 |
| | | change, % | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Europe | 57 490 | -7 | 61 971 |
--------------------------------------------------------------------------------
| Middle-East & Africa | 4 172 | -19 | 5 160 |
--------------------------------------------------------------------------------
| Greater China | 15 774 | 6 | 14 879 |
--------------------------------------------------------------------------------
| Asia-Pacific | 24 382 | 12 | 21 832 |
--------------------------------------------------------------------------------
| North America | 7 911 | -11 | 8 862 |
--------------------------------------------------------------------------------
| Latin America | 13 824 | 5 | 13 125 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total | 123 553 | -2 | 125 829 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| DEVICES & SERVICES, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFR | Reported | Special | Non-IFRS |
| | d | items & | S | 10-12/20 | items & | 10-12/20 |
| | 10-12/2 | PPA | 10-12/2 | 08 | PPA | 08 |
| | 009 | 10-12/200 | 009 | | 10-12/200 | |
| | | 9 | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 8 179 | - | 8 179 | 8 141 | - | 8 141 |
--------------------------------------------------------------------------------
| Cost of | -5 372 | - | -5 372 | -5 390 | - | -5 390 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 2 807 | - | 2 807 | 2 751 | - | 2 751 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 34.3 | | 34.3 | 33.8 | | 33.8 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -793 | 2 | -791 | -901 | 153 | -748 |
| and | | | | | | |
| developmen | | | | | | |
| t expenses | | | | | | |
| 1) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 9.7 | | 9.7 | 11.1 | | 9.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling | -640 | - | -640 | -837 | 12 | -825 |
| and | | | | | | |
| marketing | | | | | | |
| expenses | | | | | | |
| 2) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 7.8 | | 7.8 | 10.3 | | 10.1 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administra | -110 | - | -110 | -94 | - | -94 |
| tive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| % of net | 1.3 | | 1.3 | 1.2 | | 1.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -45 | 36 | -9 | -153 | 52 | -101 |
| income and | | | | | | |
| expenses | | | | | | |
| 3) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | 1 219 | 38 | 1 257 | 766 | 217 | 983 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 14.9 | | 15.4 | 9.4 | | 12.1 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Amortization of acquired intangible assets of EUR 2 million in Q4/09. EUR |
| 153 million in Q4/08 representing the contribution of assets to Symbian |
| Foundation. |
--------------------------------------------------------------------------------
| 2) EUR 12 million in Q4/08 representing the contribution of assets to |
| Symbian Foundation. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 36 million in Q4/09 and EUR 52 million in |
| Q4/08 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NAVTEQ, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFRS | Reported | Special | Non-IFRS |
| | d | items & | 10-12/20 | 10-12/20 | items & | 10-12/20 |
| | 10-12/2 | PPA | 09 | 08 | PPA | 08 |
| | 009 | 10-12/20 | | | 10-12/200 | |
| | | 09 | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 225 | - | 225 | 205 | 1 | 206 |
| 1) | | | | | | |
--------------------------------------------------------------------------------
| Cost of | -30 | 1 | -29 | -25 | - | -25 |
| sales 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 195 | 1 | 196 | 180 | 1 | 181 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 86.7 | | 87.1 | 87.8 | | 87.9 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -175 | 82 | -93 | -174 | 90 | -84 |
| and | | | | | | |
| developmen | | | | | | |
| t expenses | | | | | | |
| 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 77.8 | | 41.3 | 84.9 | | 40.8 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling | -58 | 27 | -31 | -59 | 30 | -29 |
| and | | | | | | |
| marketing | | | | | | |
| expenses | | | | | | |
| 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 25.8 | | 13.8 | 28.8 | | 14.1 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administra | -17 | - | -17 | -17 | - | -17 |
| tive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| % of net | 7.6 | | 7.6 | 8.3 | | 8.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -1 | - | -1 | -3 | 5 | 2 |
| income and | | | | | | |
| expenses | | | | | | |
| 5) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | -56 | 110 | 54 | -73 | 126 | 53 |
| profit/los | | | | | | |
| s | | | | | | |
--------------------------------------------------------------------------------
| % of net | -24.9 | | 24.0 | -35.6 | | 25.7 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 1 million in Q4/08. |
--------------------------------------------------------------------------------
| 2) Amortization of acquired intangibles of EUR 1 million in Q4/09. |
--------------------------------------------------------------------------------
| 3) Amortization of acquired intangibles of EUR 82 million in Q4/09 and EUR |
| 90 million in Q4/08. |
--------------------------------------------------------------------------------
| 4) Amortization of acquired intangibles of EUR 27 million in Q4/09 and EUR |
| 30 million in Q4/08 |
--------------------------------------------------------------------------------
| 5) Amortization of acquired intangibles of EUR 5 million in Q4/08 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOKIA SIEMENS NETWORKS, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFRS | Reported | Special | Non-IFRS |
| | d | items & | 10-12/20 | 10-12/20 | items & | 10-12/20 |
| | 10-12/2 | PPA | 09 | 08 | PPA | 08 |
| | 009 | 10-12/20 | | | 10-12/200 | |
| | | 09 | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 3 625 | - | 3 625 | 4 338 | 2 | 4 340 |
| 1) | | | | | | |
--------------------------------------------------------------------------------
| Cost of | -2 554 | 37 | -2 517 | -3 206 | 184 | -3 022 |
| sales 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 1 071 | 37 | 1 108 | 1 132 | 186 | 1 318 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 29.5 | | 30.6 | 26.1 | | 30.4 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -597 | 77 | -520 | -654 | 88 | -566 |
| and | | | | | | |
| developmen | | | | | | |
| t expenses | | | | | | |
| 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 16.5 | | 14.3 | 15.1 | | 13.0 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling | -350 | 76 | -274 | -390 | 60 | -330 |
| and | | | | | | |
| marketing | | | | | | |
| expenses | | | | | | |
| 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 9.7 | | 7.6 | 9.0 | | 7.6 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administra | -141 | 16 | -125 | -206 | 61 | -145 |
| tive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
| 5) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 3.9 | | 3.4 | 4.7 | | 3.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | 34 | -22 | 12 | -61 | 9 | -52 |
| income and | | | | | | |
| expenses | | | | | | |
| 6) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | 17 | 184 | 201 | -179 | 404 | 225 |
| profit/los | | | | | | |
| s | | | | | | |
--------------------------------------------------------------------------------
| % of net | 0.5 | | 5.5 | -4.1 | | 5.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 2 million in Q4/08. |
--------------------------------------------------------------------------------
| 2) Restructuring charges of EUR 37 million in Q4/09 and of EUR 184 million |
| in Q4/08. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 32 million and amortization of acquired |
| intangibles of EUR 45 million in Q4/09. || Restructuring charges of EUR 43 million and amortization of acquired |
| intangibles of EUR 45 million in Q4/08. |
--------------------------------------------------------------------------------
| 4) Restructuring charges of EUR 4 million and amortization of acquired |
| intangibles of EUR 72 million in Q4/09. Reversal of restructuring charges of |
| EUR 11 million and amortization of acquired intangibles of EUR 71 million in |
| Q4/08. |
--------------------------------------------------------------------------------
| 5) Restructuring charges of EUR 16 million in Q4/09 and EUR 61 million in |
| Q4/08. |
--------------------------------------------------------------------------------
| 6) Gain on sale of real estate EUR 22 million in Q4/09. Restructuring |
| charges of EUR 9 million in Q4/08. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| GROUP COMMON FUNCTIONS, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFR | Reported | Special | Non-IFRS |
| | d | items & | S | 10-12/20 | items & | 10-12/20 |
| | 10-12/2 | PPA | 10-12/2 | 08 | PPA | 08 |
| | 009 | 10-12/20 | 009 | | 10-12/2008 | |
| | | 09 | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | - | - | - | - | - | - |
--------------------------------------------------------------------------------
| Cost of | - | - | - | - | - | - |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | - | - | - | - | - | - |
| profit | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | - | - | - | -2 | - | -2 |
| and | | | | | | |
| developmen | | | | | | |
| t expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling | - | - | - | -1 | - | -1 |
| and | | | | | | |
| marketing | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administra | -26 | - | -26 | -28 | - | -28 |
| tive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -13 | - | -13 | 9 | - | 9 |
| income and | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | -39 | - | -39 | -22 | - | -22 |
| profit/los | | | | | | |
| s | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| NOKIA GROUP |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFR | Reported | Special | Non-IFRS |
| | d | items & | S | 10-12/20 | items & | 10-12/20 |
| | 10-12/2 | PPA | 10-12/2 | 08 | PPA | 08 |
| | 009 | 10-12/2 | 009 | | 10-12/2 | |
| | | 009 | | | 008 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales 1) | 11 988 | - | 11 988 | 12 662 | 3 | 12 665 |
--------------------------------------------------------------------------------
| Cost of sales | -7 915 | 38 | -7 877 | -8 599 | 184 | -8 415 |
| 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross profit | 4 073 | 38 | 4 111 | 4 063 | 187 | 4 250 |
--------------------------------------------------------------------------------
| % of net sales | 34.0 | | 34.3 | 32.1 | | 33.6 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research and | -1 565 | 161 | -1 404 | -1 731 | 331 | -1 400 |
| development | | | | | | |
| expenses 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 13.1 | | 11.7 | 13.7 | | 11.1 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling and | -1 048 | 103 | -945 | -1 287 | 102 | -1 185 |
| marketing | | | | | | |
| expenses 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 8.7 | | 7.9 | 10.2 | | 9.4 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administrative | -294 | 16 | -278 | -345 | 61 | -284 |
| and general | | | | | | |
| expenses 5) | | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 2.5 | | 2.3 | 2.7 | | 2.2 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other income | -25 | 14 | -11 | -208 | 66 | -142 |
| and expenses | | | | | | |
| 6) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | 1 141 | 332 | 1 473 | 492 | 747 | 1 239 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net sales | 9.5 | | 12.3 | 3.9 | | 9.8 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Share of | 1 | | 1 | - | | - |
| results of | | | | | | |
| associated | | | | | | |
| companies | | | | | | |
--------------------------------------------------------------------------------
| Financial | -79 | | -79 | -16 | | -16 |
| income and | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit before | 1 063 | 332 | 1 395 | 476 | 747 | 1 223 |
| tax | | | | | | |
--------------------------------------------------------------------------------
| Tax | -181 | -278 | -459 | 75 | -217 | -142 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit | 882 | 54 | 936 | 551 | 530 | 1 081 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit | 948 | -36 | 912 | 576 | 382 | 958 |
| attributable | | | | | | |
| to equity | | | | | | |
| holders of the | | | | | | |
| parent | | | | | | |
--------------------------------------------------------------------------------
| Profit/loss | -66 | 90 | 24 | -25 | 148 | 123 |
| attributable | | | | | | |
| to minority | | | | | | |
| interests | | | | | | |
--------------------------------------------------------------------------------
| | 882 | 54 | 936 | 551 | 530 | 1 081 |
--------------------------------------------------------------------------------
| Earnings per share, EUR |
| (for profit attributable to the equity holders of the parent) |
--------------------------------------------------------------------------------
| Basic | 0.26 | -0.01 | 0.25 | 0.16 | 0.10 | 0.26 |
--------------------------------------------------------------------------------
| Diluted | 0.26 | -0.01 | 0.25 | 0.15 | 0.11 | 0.26 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Average number of shares |
| (1 000 shares) |
--------------------------------------------------------------------------------
| Basic | 3708113 | | 3708113 | 3697553 | | 3697553 |
--------------------------------------------------------------------------------
| Diluted | 3713778 | | 3713778 | 3724043 | | 3724043 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Depreciation | 451 | -229 | 222 | 446 | -236 | 210 |
| and | | | | | | |
| amortization, | | | | | | |
| total | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Share-based | 14 | - | 14 | -60 | - | -60 |
| compensation | | | | | | |
| expense, total | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 3 million in Q4/08. |
--------------------------------------------------------------------------------
| 2) Restructuring charges of EUR 37 million and amortization of acquired |
| intangible assets of EUR 1 million in Q4/09. |
| Restructuring charges of EUR 184 million in Q4/08. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 32 million and amortization of acquired |
| intangible assets of EUR 129 million in Q4/09. Restructuring charges of EUR |
| 43 million, amortization of acquired intangible assets of EUR 135 million |
| and EUR 153 million representing the contribution of assets to Symbian |
| Foundation Q4/08. |
--------------------------------------------------------------------------------
| 4) Restructuring charges of EUR 4 million and amortization of acquired |
| intangible assets of EUR 99 million in Q4/09. Reversal of restructuring |
| charges of 11million; EUR 12 million representing the contribution of assets |
| to Symbian Foundation and amortization of acquired intangible assets of EUR |
| 101 million in Q4/08. |
--------------------------------------------------------------------------------
| 5) Restructuring charges of EUR 16 million in Q4/09 and EUR 61 million in |
| Q4/08. |
--------------------------------------------------------------------------------
| 6) Restructuring charges of EUR 36 million and a gain on sale of real estate |
| EUR 22 million in Q4/09. Restructuring charges of EUR 66 million in Q4/08. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME, IFRS, EUR million |
--------------------------------------------------------------------------------
| | 10-12/2009 | 10-12/2008 | 1-12/2009* | 1-12/2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit | 882 | 551 | 260 | 3 889 |
--------------------------------------------------------------------------------
| Other | | | | |
| comprehensive | | | | |
| income | | | | |
--------------------------------------------------------------------------------
| Translation | 3 | 173 | -563 | 595 |
| differences | | | | |
--------------------------------------------------------------------------------
| Net investment | 6 | -82 | 114 | -123 |
| hedge gains | | | | |
--------------------------------------------------------------------------------
| Cash flow hedges | -85 | 76 | 25 | -40 |
--------------------------------------------------------------------------------
| Available-for-sale | 51 | -44 | 48 | -15 |
| investments | | | | |
--------------------------------------------------------------------------------
| Other | 5 | -37 | -7 | 28 |
| increase/decrease, | | | | |
| net | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Income tax related | 24 | 13 | -44 | 58 |
| to components of | | | | |
| other | | | | |
| comprehensive | | | | |
| income | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other | 4 | 99 | -427 | 503 |
| comprehensive | | | | |
| income, net of tax | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total | 886 | 650 | -167 | 4 392 |
| comprehensive | | | | |
| income/expense | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income/expense |
| attributable to |
--------------------------------------------------------------------------------
| equity holders of | 960 | 674 | 429 | 4 577 |
| the parent | | | | |
--------------------------------------------------------------------------------
| minority interests | -74 | -24 | -596 | -185 |
--------------------------------------------------------------------------------
| | 886 | 650 | -167 | 4 392 |
--------------------------------------------------------------------------------
NOKIA IN JANUARY - DECEMBER 2009
(The following discussion is of Nokia's reported results. Comparisons are given
to 2008 results, unless otherwise indicated.)
Nokia completed the acquisition of NAVTEQ Corporation on July 10, 2008. NAVTEQ
is a separate reportable segment of Nokia starting from the third quarter 2008.
The results of NAVTEQ are not available for the prior periods. Accordingly, the
results of Nokia Group and NAVTEQ for the full year 2009 are not directly
comparable to the results for the full year 2008.
Nokia Group
For 2009, Nokia's net sales decreased 19% to EUR 41.0 billion (EUR 50.7 billion
in 2008). Net sales of Devices & Services for 2009 decreased 21% to EUR 27.9
billion (EUR 35.1 billion). Net sales of Nokia Siemens Networks decreased 18% to
EUR 12.6 billion (EUR 15.3 billion). Net sales of NAVTEQ were EUR 670 million in
2009 (EUR 361 million for the six months ended December 31, 2008).
In 2009, Europe accounted for 36% (37%) of Nokia's net sales, Asia-Pacific 22%
(22%), Greater China 16% (13%), Middle East & Africa 14% (14%), Latin America 7%
(10%) and North America 5% (4%). The 10 markets in which Nokia generated the
greatest net sales in 2009 were, in descending order of magnitude, China, India,
the United Kingdom, Germany, the United States, Russia, Indonesia, Spain, Brazil
and Italy, together representing approximately 52% of total net sales in 2009.
In comparison, the 10 markets in which Nokia generated the greatest net sales in
2008 were China, India, the United Kingdom, Germany, Russia, Indonesia, the
United States, Brazil, Italy and Spain, together representing approximately 50%
of total net sales in 2008.
Nokia's gross margin in 2009 was 32.4%, compared to 34.3% in 2008. Nokia's 2009
operating profit decreased 76% to EUR 1.2 billion, compared with EUR 5.0 billion
in 2008. Nokia's 2009 operating margin was 2.9% (9.8%). Nokia's operating profit
in 2009 included purchase price accounting items and other special items of net
negative EUR 2.3 billion (net negative EUR 2.1 billion). Devices & Services
operating profit decreased 43% to EUR 3.3 billion, compared with EUR 5.8 billion
in 2008, with a reported operating margin of 11.9% (16.6%). Devices & Services
operating profit in 2009 included special items of negative EUR 174 million (net
negative EUR 557 million). NAVTEQ's operating loss for 2009 was EUR 344 million
(EUR 153 million in the six months ended on December 31, 2008), representing an
operating margin of -51.3% (-42.4%). NAVTEQ's operating loss included purchase
price accounting items and other special items of negative EUR 465 million (net
negative EUR 235 million). Nokia Siemens Networks had an operating loss of EUR
1.6 billion, compared with a EUR 301 million operating loss in 2008,
representing an operating margin of -13.0% (-2.0%). Nokia Siemens Networks
operating loss in 2009 included purchase price accounting items and other
special items, including EUR 908 million impairment of goodwill, of net negative
EUR 1.7 billion (net negative EUR 1.1 billion).
For the full year 2009, Nokia's net sales and profitability were negatively
impacted by the deteriorated global economic conditions, including weaker
consumer and corporate spending, constrained credit availability and currency
market volatility. The demand environment, in particular for mobile devices,
improved during the latter part of the year as the global economy started
showing initial signs of recovery.
Reported research and development expenses were EUR 5.9 billion in 2009, down 1%
from EUR 6.0 billion in 2008. Research and development costs represented 14.4%
of Nokia net sales in 2009, up from 11.8% in 2008. Research and development
expenses included purchase price accounting items and other special items of EUR
564 million in 2009 (EUR 550 million in 2008). At December 31, 2009, Nokia
employed 37 020 people in research and development, representing approximately
30% of the group's total workforce, and had a strong research and development
presence in 16 countries.
In 2009, Nokia's selling and marketing expenses were EUR 3.9 billion, compared
with EUR 4.4 billion in 2008. Selling and marketing expenses for Nokia
represented 9.6% of its net sales in 2009 (8.6%). Selling and marketing expenses
included purchase price accounting items and other special items of EUR 413
million in 2009 (EUR 341 million).
Administrative and general expenses were EUR 1.1 billion in 2009, compared to
EUR 1.3 billion in 2008. Administrative and general expenses were equal to 2.8%
of net sales in 2009 (2.5%). Administrative and general expenses included
special items of EUR 103 million in 2009 (EUR 163 million).
Group Common Functions expenses totaled EUR 134 million in 2009, compared to EUR
396 million in 2008. Expenses in 2008 included a EUR 217 million loss due to
transfer of Finnish pension liabilities.
Net financial expense was EUR 265 million in 2009 (EUR 2 million).
Profit before tax and minority interests was EUR 1.0 billion (EUR 5.0 billion).
Profit was EUR 0.3 billion (profit of EUR 3.9 billion), based on a profit of EUR
0.9 billion (profit of EUR 4.0 billion) attributable to equity holders of the
parent and a negative EUR 0.6 billion (negative EUR 0.1 billion) attributable to
minority interests. Earnings per share decreased to EUR 0.24 (basic) and EUR
0.24 (diluted), compared to EUR 1.07 (basic) and EUR 1.05 (diluted) in 2008.
Operating cash flow for the year ended December 31, 2009 was EUR 3.2 billion
(EUR 3.2 billion) and total combined cash and other liquid assets were EUR 8.9
billion (EUR 6.8 billion). As of December 31, 2009, our net debt-to-equity ratio
(gearing) was -25% (-14% as of December 31, 2008). In 2009, capital expenditure
amounted to EUR 531 million (EUR 889 million).
Devices & Services
In 2009, the total mobile device volume of our Devices & Services group reached
432 million units, representing a decrease of 8% year on year. The overall
industry mobile device volumes for 2009 reached 1.14 billion units, based on
Nokia's preliminary market estimate, representing a decrease of 6% year on
year. Based on our preliminary market estimate, Nokia's market share decreased
to 38% in 2009, compared to 39% in 2008.
Of the total industry mobile device volumes, converged mobile device industry
volumes in 2009 increased to 176 million units, based on Nokia's estimate,
compared with an estimated 161 million units in 2008. Our own converged mobile
device volumes increased to 67.8 million units in 2009, compared with 60.6
million units in 2008. Nokia shipped approximately 18 million Nokia Nseries and
approximately 18 million Nokia Eseries devices in 2009, down from the combined
46 million Nseries and Eseries devices we shipped in 2008.
The following chart sets out our mobile device volumes for the periods
indicated, as well as the year on year growth rates, by geographic area.
--------------------------------------------------------------------------------
| NOKIA MOBILE DEVICE VOLUME BY GEOGRAPHIC AREA |
--------------------------------------------------------------------------------
| (million units) | 2009 | 2008 | YoY Change |
--------------------------------------------------------------------------------
| Europe | 107.0 | 114.9 | -6.9% |
--------------------------------------------------------------------------------
| Middle East & | 77.6 | 81.0 | -4.2% |
| Africa | | | |
--------------------------------------------------------------------------------
| Greater China | 72.6 | 71.3 | 1.8% |
--------------------------------------------------------------------------------
| Asia-Pacific | 123.5 | 134.0 | -7.8% |
--------------------------------------------------------------------------------
| North America | 13.5 | 15.7 | -14.0% |
--------------------------------------------------------------------------------
| Latin America | 37.6 | 51.5 | -27.0% |
--------------------------------------------------------------------------------
| Total | 431.8 | 468.4 | -7.8% |
--------------------------------------------------------------------------------
During 2009, Nokia gained device market share in Europe and Middle East &
Africa. Our device market share decreased in Asia-Pacific, Latin America and
North America. Our device market share was flat in Greater China.
In Europe, our market share increased. Nokia's share increased in, for example,
Germany, the United Kingdom, Russia and Spain, but was partly offset by market
share declines in Italy, Finland, Ireland and some other countries. In Middle
East & Africa, Nokia's 2009 market share increased, driven by share gains in
markets such as Nigeria and Iran as Nokia continued to benefit from its brand
and broad product portfolio.
In Asia-Pacific, Nokia's market share declined in 2009 as a result of market
share losses in several markets, including Singapore and Thailand. In Latin
America, Nokia's market share declined in 2009 as a result of market share
losses in several markets, including Brazil, Mexico and Argentina. Our market
share declined in North America in 2009 primarily due to a market share decline
in the United States. In Greater China, Nokia continued to benefit from its
brand, broad product portfolio and extensive distribution system during 2009.
Nokia's device ASP in 2009 was EUR 63, a decline of 15% from EUR 74 in 2008.
Industry ASPs also declined in 2009. Nokia's lower ASP in 2009 compared to 2008
was primarily the result of a higher proportion of lower-priced entry level
device sales as well as general price pressure.
Devices & Services net sales 2009 declined 21% to EUR 27.9 billion, compared
with EUR 35.1 billion in 2008. At constant currency, Devices & Services net
sales would have decreased 20%. The decline was driven by both volume decline as
well as an ASP decline. Of our total Devices & Services net sales, services
contributed EUR 607 million in 2009. Net sales in Devices & Services were down
in all regions except Greater China year on year.
Devices & Services gross profit decreased 27% to EUR 9.3 billion, compared with
EUR 12.7 billion in 2008, with a gross margin of 33.3% (36.3%). Devices &
Services operating profit decreased 43% to EUR 3.3 billion, compared with EUR
5.8 billion in 2008. Devices & Services operating margin in 2009 was 11.9%,
compared with 16.6% in 2008. The year on year decrease in operating profit in
2009 was driven primarily by lower net sales compared to 2008.
NAVTEQ
Net sales of NAVTEQ were EUR 670 million in 2009, compared to EUR 361 million
for the six months ended on December 31, 2008. Europe accounted for 46% (44%) of
NAVTEQ's net sales, North America 44% (43%), Middle East & Africa 4% (8 %),
Asia-Pacific 3% (2%), Latin America 2% (2%) and Greater China 1% (1%).
NAVTEQ operating loss was EUR 344 million in 2009, compared to a loss of EUR 153
million for the six months ended on December 31, 2008. NAVTEQ operating margin
was -51.3% (-42.4%).
Nokia Siemens Networks
Net sales of Nokia Siemens Networks decreased 18% to EUR 12.6 billion in 2009,
compared with EUR 15.3 billion in 2008, reflecting challenging market conditions
and competitive factors. At constant currency, net sales of Nokia Siemens
Networks would have decreased 16%. Europe accounted for 37% (37%) of Nokia
Siemens Network's net sales, Asia-Pacific 22% (25%), Middle East & Africa 13%
(13%), Latin America 11% (11%), Greater China 11% (9%) and North America 6%
(5%).
Nokia Siemens Networks had an operating loss of EUR 1.6 billion, compared with
operating loss of EUR 301 million in 2008. Operating margin of Nokia Siemens
Networks in 2009 was -13.0% compared with -2.0% in 2008. The increase in
operating loss in 2009 resulted primarily from a non tax deductible impairment
of goodwill charge of EUR 908 million and lower net sales, the impact of which
was partially offset by lower cost of sales and lower operating expenses.
2009 OPERATING HIGHLIGHTS
Nokia
- Nokia formed Solutions, a new unit responsible for driving Nokia's offering of
solutions, with the aim of integrating the mobile device, services and content
into a unique and compelling offering for the consumer. The unit formally
started operating on October 1, 2009.
- Nokia announced changes to its Group Executive Board, with Robert Andersson
leaving Nokia's Group Executive Board as of September 30, 2009 in connection
with his transfer to new duties in Nokia's Corporate Development unit; Alberto
Torres joining Nokia's Group Executive Board as of October 1, 2009 in connection
with his appointment as head of the Solutions unit, and; Simon Beresford-Wylie
leaving the Group Executive Board on September 30, 2009 after stepping down as
Chief Executive Officer of Nokia Siemens Networks.
- Nokia announced that Rajeev Suri was appointed as Chief Executive Officer of
Nokia Siemens Networks as of October 1, 2009.
- Nokia continued to take action to adjust its business operations and cost base
in accordance with market demand as well as seek savings in operational
expenses, looking at all areas and activities across Devices & Services and
global support functions. Actions included the closure of certain Nokia
facilities, the streamlining of Nokia's research and development organization,
temporary lay-offs in production, and measures to increase efficiency in certain
global support functions.
- Nokia was named as the world's most sustainable technology company according
to the 2009-2010 edition of the Dow Jones Sustainability Indexes.
Devices & Services
- Nokia strengthened its portfolio of Mobile Phones with new models such as the:
Nokia 5130 XpressMusic, an affordable handset optimized for music; the Nokia
6303 classic, featuring a 3.2 megapixel camera, an Internet browser and long
battery life; and the Nokia 6700 classic, equipped with a 5 megapixel camera,
assisted GPS navigation, and high speed data access.
- To create additional value for users of our Mobile Phones, Nokia also
developed its offering of services designed to be accessed with them: In India
and Indonesia, Nokia launched Nokia Life Tools, through which consumers can
access timely and relevant agricultural information, as well as education and
entertainment services, without requiring the use of GPRS or Internet
connectivity; Nokia also continued to expand Ovi Mail, a free email service
designed especially for users in emerging markets with Internet-enabled devices.
- Nokia introduced Nokia Money, a new mobile financial service. The service is
to be rolled out gradually to selected markets and will be operated in
cooperation with Obopay, a leading developer of mobile payment solutions in
which Nokia invested.
- Nokia strengthened its portfolio of Smartphones with new models such as the:
Nokia N97 mini, a smaller companion to the Nokia N97, featuring a tilting 3.2"
touch display and a fully customizable homescreen; the Nokia 5230, an affordable
touch smartphone that, in select markets, is available with Comes With Music;
and the Nokia E72, a device designed especially for business use and messaging,
featuring the latest consumer and corporate email solutions and simple Instant
Messaging setup.
- Building on the functionalities of Nokia's Smartphones and enhancing their
value for consumers, Nokia continued to develop Ovi, the Internet services brand
under which it has integrated many of its individual services to simplify the
user experience and differentiate it from competitors. For example, Nokia
launched Ovi Store, a one-stop shop for applications and content for millions of
Nokia device users, and made available the Ovi SDK (software development kit),
the Ovi Maps Player API (application programming interface) and the Ovi
Navigation API, enabling the creation of sophisticated applications for the web
as well as the Symbian and Maemo platforms.
- Nokia commenced shipments of the Nokia N900, a handset that delivers
computer-grade performance in a compact QWERTY and touch form factor. The Nokia
N900 runs on Maemo, a desktop PC-like software architecture based on the open
source Linux software, and which Nokia is continuing to develop.
- Nokia commenced shipments of the Nokia Booklet 3G, a new Windows 7-based
mini-laptop, built for all-day mobility and connectivity. Encased in an
ultra-portable aluminum chassis, the Nokia Booklet 3G runs for up to 12 hours on
a single charge and has a broad range of connectivity options.
- Nokia continued to partner with third party companies, operators, developers
and content providers in areas that it believes could positively differentiate
its Smartphones, as well as other Nokia mobile devices, from those offered by
competitors. For example, partnering with operators, Nokia continued to grow
Nokia Messaging, its push email and instant messaging service. Nokia also
continued to work together with the music industry to expand Nokia Music Store,
its digital music store, and Comes With Music, its ‘all-you-can-eat' music
offering. Additionally, Nokia formed a global alliance with Microsoft to design
and market a suite of productivity applications for Nokia's Smartphones, and
commenced a partnership with Intel Corporation to develop a new class of Intel®
Architecture-based mobile computing device and chipset architectures that will
combine the performance of powerful computers with high-bandwidth mobile
broadband communications and ubiquitous Internet connectivity.
NAVTEQ
− NAVTEQ announced the availability of Motorway Junction Objects, which enables
navigation systems to display full 3D animation of complex junctions, in
Australia, Europe and North America with coverage of over 8 000 locations.
− NAVTEQ announced that NAVTEQ Discover Cities™ reached a global pedestrian
navigation milestone of 100 cities.
− NAVTEQ announced the availability of NAVTEQ LocationPoint™, a location-based
advertising service for mobile applications, in several European countries, as
well as agreements with AAA, Loopt and Nextar in North America to utilize the
offering.
− NAVTEQ launched real time traffic in 11 European countries and expanded NAVTEQ
Traffic Patterns™ to 9 European countries.
− NAVTEQ launched maps in Chile, Venezuela, Iceland and Croatia, along with a
significant increase in major city coverage in its India map to now encompass 84
cities.
− NAVTEQ announced that it signed an agreement with Samsung Electronics
providing access to all countries in the NAVTEQ database as well as NAVTEQ's
Visual Content, Speed Limits, Extended Lanes and NAVTEQ Discover Cities™.
− NAVTEQ announced a global technology agreement with Microsoft to allow the
rapid deployment of innovative collection capabilities, as well as accelerating
the collection, creation and storage of 3D map data and visuals
− NAVTEQ announced the integration of Nokia GPS data for availability in NAVTEQ
traffic products in North America and Europe.
Nokia Siemens Networks
- Nokia Siemens Networks won 29 new 3G contracts during 2009, confirming its
industry-leading position in wireless broadband. The company secured key deals
across the globe including contracts with: Softbank in Japan; Telenor in Denmark
and Sweden; Megafon in Russia; Hutchison Telecom in Hong Kong; China Unicom and
China Mobile; Nuevatel in Bolivia; and Viettel and Vinaphone in Vietnam.
- Nokia Siemens Networks took significant steps forward in LTE, making the
world's first LTE call and handover on commercial software and started LTE
interoperability tests with 4 leading device vendors. Nokia Siemens Networks had
by year end 2009 shipped capable LTE hardware to close to all its 3G customers,
demonstrating readiness to support operators all over the world in the first
commercial deployments of LTE.
- Nokia Siemens Networks was selected to provide LTE networks for Zain Bahrain
and Telenor Denmark, taking commercial LTE references to six, including a deal
with Verizon, the United States operator, which selected Nokia Siemens Networks
as a supplier of its IP Multi-Media Subsystem (IMS) network, which will enable
rich multimedia applications across its networks.
- Nokia Siemens Networks signed 37 new Managed Services contracts in 2009,
breaking into new geographic markets across the world with landmark agreements
that included contracts with Orange in the United Kingdom and Spain, Oi in
Brazil, Zain in Nigeria and East Africa and Unitech in India.
- In March, Nokia Siemens Networks extended its global services delivery
capability with the inauguration of a Global Networks Solutions Centre in Noida,
India.
- Nokia Siemens Networks announced a number of technological advances including
the launch of the Flexi Multiradio base station which allows GSM/EDGE,
WCDMA/HSPA/HSPA+ and LTE standards to run concurrently in a single unit, and the
Evolved Packet Core for LTE that will enable operators to efficiently offer a
full range of data, voice, and high-quality and real-time multimedia services
over different wireless standards using the same open platform in the core
network.
- Nokia Siemens Networks also launched new solutions including FlexiPacket
Microwave, a next generation full packet microwave solution which combines
Carrier Ethernet Transport with Microwave Radio, and charge@once unified and
business solutions that allow operators to combine charging and billing.
ACQUISITIONS AND DIVESTMENTS IN 2009
- In December 2009, Nokia and New Alliance, an investment company which is part
of the Shanghai Alliance Investment Ltd, announced plans to form a 50-50 joint
venture company to offer a range of mobile services in China and support the
local developer ecosystem.
- In December 2009, Nokia sold its minority holding in Venyon, a leading trusted
service manager on the mobile near field communication (NFC) market, to Giesecke& Devrient.
- In October, 2009, Nokia completed the sale of Symbian Professional Services to
Accenture.
- In October 2009, Nokia Siemens Networks and Juniper Networks formed a joint
venture offering a Carrier Ethernet solution for mobile backhaul, business and
residential broadband networks. The joint venture company is 60% owned by
Juniper Networks and 40% by Nokia Siemens Networks.
- In September 2009, Nokia acquired Dopplr, a mobile service provider for
international travelers.
- In September 2009, NAVTEQ acquired Acuity Mobile, whose leading mobile
location-based advertising delivery platform enables NAVTEQ to continue to
differentiate its interactive advertising capabilities.
- In September 2009, Nokia acquired certain assets of Plum Ventures, a company
that develops and operates a cloud-based social media sharing and messaging
service for private groups.
- In August 2009, Nokia acquired cellity, a mobile software company that has
developed a solution for aggregating address book data.
- In April 2009, Nokia sold its security appliance business to Check Point
Software Technologies.
- In February 2009, Nokia acquired bit-side, a professional services and
software company.
- In January 2009, NAVTEQ acquired T-Traffic Systems, a leading provider of
traffic services in Germany.
PERSONNEL
The average number of employees during 2009 was 123 171, of which the average
number of employees at Nokia Siemens Networks was 62 129. At December 31, 2009,
Nokia employed a total of 123 553 people (125 829 people at December 31, 2008),
of which 63 927 were employed by Nokia Siemens Networks (60 295 people at
December 31, 2008).
SHARES
The total number of Nokia shares at December 31, 2009 was 3 744 956 052. At
December 31, 2009, Nokia and its subsidiary companies owned 36 693 564 Nokia
shares, representing approximately 1.0 % of the total number of Nokia shares and
the total voting rights.
DIVIDEND
Nokia's Board of Directors will propose a dividend of EUR 0.40 per share for
2009.
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT, EUR million |
--------------------------------------------------------------------------------
| (unaudited) |
--------------------------------------------------------------------------------
| | Reported | Reported | | Non-IFRS | Non-IFRS |
--------------------------------------------------------------------------------
| | 1-12/2009 | 1-12/2008 | | 1-12/2009 | 1-12/2008 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Net sales | 40 984 | 50 710 | | 40 987 | 50 722 |
--------------------------------------------------------------------------------
| Cost of sales | -27 720 | -33 337 | | -27 568 | -32 935 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Gross profit | 13 264 | 17 373 | | 13 419 | 17 787 |
--------------------------------------------------------------------------------
| Research and | -5 909 | -5 968 | | -5 345 | -5 418 |
| development expenses | | | | | |
--------------------------------------------------------------------------------
| Selling and | -3 933 | -4 380 | | -3 520 | -4 039 |
| marketing expenses | | | | | |
--------------------------------------------------------------------------------
| Administrative and | -1 145 | -1 284 | | -1 042 | -1 121 |
| general expenses | | | | | |
--------------------------------------------------------------------------------
| Impairment of | -908 | - | | - | - |
| goodwill | | | | | |
--------------------------------------------------------------------------------
| Other income | 338 | 420 | | 248 | 355 |
--------------------------------------------------------------------------------
| Other expenses | -510 | -1 195 | | -257 | -531 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Operating profit | 1 197 | 4 966 | | 3 503 | 7 033 |
--------------------------------------------------------------------------------
| Share of results of | 30 | 6 | | 30 | 6 |
| associated companies | | | | | |
--------------------------------------------------------------------------------
| Financial income and | -265 | -2 | | -265 | -2 |
| expenses | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit before tax | 962 | 4 970 | | 3 268 | 7 037 |
--------------------------------------------------------------------------------
| Tax | -702 | -1 081 | | -876 | -1 674 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit | 260 | 3 889 | | 2 392 | 5 363 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Profit attributable | 891 | 3 988 | | 2 455 | 5 076 |
| to equity holders of | | | | | |
| the parent | | | | | |
--------------------------------------------------------------------------------
| Profit/loss | -631 | -99 | | -63 | 287 |
| attributable to | | | | | |
| minority interests | | | | | |
--------------------------------------------------------------------------------
| | 260 | 3 889 | | 2 392 | 5 363 |
--------------------------------------------------------------------------------
| Earnings per share, EUR |
| (for profit attributable to the equity holders of the parent) |
--------------------------------------------------------------------------------
| Basic | 0.24 | 1.07 | | 0.66 | 1.36 |
--------------------------------------------------------------------------------
| Diluted | 0.24 | 1.05 | | 0.66 | 1.34 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Average number of | | | | | |
| shares (1 000 | | | | | |
| shares) | | | | | |
--------------------------------------------------------------------------------
| Basic | 3 705 116 | 3 743 622 | | 3 705 116 | 3 743 622 |
--------------------------------------------------------------------------------
| Diluted | 3 721 072 | 3 780 363 | | 3 721 072 | 3 780 363 |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Depreciation and | 1 784 | 1 617 | | 930 | 923 |
| amortization, total | | | | | |
--------------------------------------------------------------------------------
| | | | | | |
--------------------------------------------------------------------------------
| Share-based | 13 | 67 | | 13 | 67 |
| compensation | | | | | |
| expense, total | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| DEVICES & SERVICES, EUR million |
--------------------------------------------------------------------------------
| (reported and non-IFRS 1-12/2009 unaudited, reported 1-12/2008 audited, |
| non-IFRS 1-12/2008 unaudited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Reported | Special | Non-IFRS | Reported | Special | Non-IFRS |
| | 1-12/200 | items & | 1-12/200 | 1-12/200 | items & | 1-12/200 |
| | 9 | PPA | 9 | 8 | PPA | 8 |
| | | 1-12/200 | | | 1-12/20 | |
| | | 9 | | | 08 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 27 853 | - | 27 853 | 35 099 | - | 35 099 |
--------------------------------------------------------------------------------
| Cost of | -18 583 | - | -18 583 | -22 360 | - | -22 360 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 9 270 | - | 9 270 | 12 739 | - | 12 739 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 33.3 | | 33.3 | 36.3 | | 36.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -2 984 | 8 | -2 976 | -3 127 | 153 | -2 974 |
| and | | | | | | |
| development | | | | | | |
| expenses 1) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 10.7 | | 10.7 | 8.9 | | 8.5 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling and | -2 366 | - | -2 366 | -2 847 | 12 | -2 835 |
| marketing | | | | | | |
| expenses 2) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 8.5 | | 8.5 | 8.1 | | 8.1 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administrat | -417 | - | -417 | -429 | - | -429 |
| ive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| % of net | 1.5 | | 1.5 | 1.2 | | 1.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -189 | 166 | -23 | -520 | 392 | -128 |
| income and | | | | | | |
| expenses 3) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | 3 314 | 174 | 3 488 | 5 816 | 557 | 6 373 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 11.9 | | 12.5 | 16.6 | | 18.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Amortization of acquired intangible assets of EUR 8 million 2009. EUR 153 |
| million in 2008 representing the contribution of assets to Symbian |
| Foundation. |
--------------------------------------------------------------------------------
| 2) EUR 12 million in 2008 representing the contribution of assets to Symbian |
| Foundation. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 178 million, impairment of assets EUR 56 |
| million and gain on sale of security appliance business of EUR 68 million in |
| 2009. Restructuring charges of EUR 392 million in 2008. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NAVTEQ, EUR million |
--------------------------------------------------------------------------------
| (reported and non-IFRS 1-12/2009 unaudited, reported 1-12/2008 audited, |
| non-IFRS 1-12/2008 unaudited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Reported | Special | Non-IFR | Reported | Special | Non-IFRS |
| | 1-12/200 | items & | S | 1-12/200 | items & | 1-12/200 |
| | 9 | PPA | 1-12/20 | 8 | PPA | 8 |
| | | 1-12/200 | 09 | | 1-12/2008 | |
| | | 9 | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 670 | 3 | 673 | 361 | 2 | 363 |
| 1) | | | | | | |
--------------------------------------------------------------------------------
| Cost of | -88 | 1 | -87 | -43 | - | -43 |
| sales 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 582 | 4 | 586 | 318 | 2 | 320 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 86.9 | | 87.1 | 88.1 | | 88.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -653 | 346 | -307 | -332 | 171 | -161 |
| and | | | | | | |
| developmen | | | | | | |
| t expenses | | | | | | |
| 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 97.5 | | 45.6 | 92.0 | | 44.4 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling | -217 | 115 | -102 | -109 | 57 | -52 |
| and | | | | | | |
| marketing | | | | | | |
| expenses | | | | | | |
| 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 32.4 | | 15.2 | 30.2 | | 14.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administra | -57 | - | -57 | -30 | - | -30 |
| tive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| % of net | 8.5 | | 8.5 | 8.3 | | 8.3 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | 1 | - | 1 | 0 | 5 | 5 |
| income and | | | | | | |
| expenses | | | | | | |
| 5) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | -344 | 465 | 121 | -153 | 235 | 82 |
| profit/los | | | | | | |
| s | | | | | | |
--------------------------------------------------------------------------------
| % of net | -51.3 | | 18.0 | -42.4 | | 22.6 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 3 million in 2009 and EUR |
| 2 million in 2008. |
--------------------------------------------------------------------------------
| 2) Amortization of acquired intangibles of EUR 1 million in 2009. |
--------------------------------------------------------------------------------
| 3) Amortization of acquired intangibles of EUR 346 million in 2009 and EUR |
| 171 million in 2008. |
--------------------------------------------------------------------------------
| 4) Amortization of acquired intangibles of EUR 115 million in 2009 and EUR |
| 57 million in 2008. |
--------------------------------------------------------------------------------
| 5) Restructuring charges of EUR 5 million in 2008. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NOKIA SIEMENS NETWORKS, EUR million |
--------------------------------------------------------------------------------
| (reported and non-IFRS 1-12/2009 unaudited, reported 1-12/2008 audited, |
| non-IFRS 1-12/2008 unaudited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Reported | Special | Non-IFR | Reported | Special | Non-IFRS |
| | 1-12/200 | items & | S | 1-12/200 | items & | 1-12/200 |
| | 9 | PPA | 1-12/20 | 8 | PPA | 8 |
| | | 1-12/200 | 09 | | 1-12/200 | |
| | | 9 | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | 12 574 | - | 12 574 | 15 309 | 10 | 15 319 |
| 1) | | | | | | |
--------------------------------------------------------------------------------
| Cost of | -9 162 | 151 | -9 011 | -10 993 | 402 | -10 591 |
| sales 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | 3 412 | 151 | 3 563 | 4 316 | 412 | 4 728 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 27.1 | | 28.3 | 28.2 | | 30.9 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -2 271 | 210 | -2 061 | -2 500 | 226 | -2 274 |
| and | | | | | | |
| development | | | | | | |
| expenses 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 18.1 | | 16.4 | 16.3 | | 14.8 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling and | -1 349 | 298 | -1 051 | -1 421 | 272 | -1 149 |
| marketing | | | | | | |
| expenses 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 10.7 | | 8.4 | 9.3 | | 7.5 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administrat | -573 | 103 | -470 | -689 | 163 | -526 |
| ive and | | | | | | |
| general | | | | | | |
| expenses 5) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 4.6 | | 3.7 | 4.5 | | 3.4 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -858 | 905 | 47 | -7 | -15 | -22 |
| income and | | | | | | |
| expenses 6) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | -1 639 | 1 667 | 28 | -301 | 1 058 | 757 |
| profit/loss | | | | | | |
--------------------------------------------------------------------------------
| % of net | -13.0 | | 0.2 | -2.0 | | 4.9 |
| sales | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 10 million in 2008. |
--------------------------------------------------------------------------------
| 2) Restructuring charges of EUR 151 million in 2009 and of EUR 402 million |
| in 2008. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 30 million and amortization of acquired |
| intangibles of EUR 180 million in 2009. |
| Restructuring charges of EUR 46 million and amortization of acquired |
| intangibles of EUR 180 million in 2008. |
--------------------------------------------------------------------------------
| 4) Restructuring charges of EUR 12 million and amortization of acquired |
| intangibles of EUR 286 million in 2009. Reversal of restructuring charges of |
| EUR 14 million and amortization of acquired intangibles of EUR 286 million |
| in 2008. |
--------------------------------------------------------------------------------
| 5) Restructuring charges of EUR 103 million in 2009 and EUR 163 million in |
| 2008. |
--------------------------------------------------------------------------------
| 6) Impairment of goodwill of EUR 908 million, gain on sale of real estate |
| EUR 22 million, restructuring charges of EUR 14 million and amortization of |
| acquired intangible assets of EUR 5 million in 2009. Restructuring charges |
| of EUR 49 million, amortization of acquired intangible assets of EUR 1 |
| million and gain on transfer of Finnish pension liability of EUR 65 million |
| in 2008. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| GROUP COMMON FUNCTIONS, EUR million |
--------------------------------------------------------------------------------
| (reported and non-IFRS 1-12/2009 unaudited, reported 1-12/2008 audited, |
| non-IFRS 1-12/2008 unaudited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFR | Reported | Special | Non-IFRS |
| | d | items & | S | 1-12/200 | items & | 1-12/200 |
| | 1-12/20 | PPA | 1-12/20 | 8 | PPA | 8 |
| | 09 | 1-12/2009 | 09 | | 1-12/200 | |
| | | | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales | - | - | - | - | - | - |
--------------------------------------------------------------------------------
| Cost of | - | - | - | - | - | - |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross | - | - | - | - | - | - |
| profit | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research | -1 | - | -1 | -9 | - | -9 |
| and | | | | | | |
| development | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling and | -1 | - | -1 | -3 | - | -3 |
| marketing | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administrat | -98 | - | -98 | -136 | - | -136 |
| ive and | | | | | | |
| general | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other | -34 | - | -34 | -248 | 217 | -31 |
| income and | | | | | | |
| expenses 1) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | -134 | - | -134 | -396 | 217 | -179 |
| profit/loss | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| 1) Loss on transfer of Finnish pension liability of EUR 217 million in 2008. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT, EUR million |
--------------------------------------------------------------------------------
| (reported and non-IFRS 1-12/2009 unaudited, reported 1-12/2008 audited, |
| non-IFRS 1-12/2008 unaudited) |
--------------------------------------------------------------------------------
| NOKIA GROUP | | | | | | |
--------------------------------------------------------------------------------
| | Reporte | Special | Non-IFR | Reported | Special | Non-IFRS |
| | d | items & | S | 1-12/200 | items & | 1-12/200 |
| | 1-12/20 | PPA | 1-12/20 | 8 | PPA | 8 |
| | 09 | 1-12/200 | 09 | | 1-12/200 | |
| | | 9 | | | 8 | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Net sales 1) | 40 984 | 3 | 40 987 | 50 710 | 12 | 50 722 |
--------------------------------------------------------------------------------
| Cost of | -27 720 | 152 | -27 568 | -33 337 | 402 | -32 935 |
| sales 2) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Gross profit | 13 264 | 155 | 13 419 | 17 373 | 414 | 17 787 |
--------------------------------------------------------------------------------
| % of net | 32.4 | | 32.7 | 34.3 | | 35.1 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Research and | -5 909 | 564 | -5 345 | -5 968 | 550 | -5 418 |
| development | | | | | | |
| expenses 3) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 14.4 | | 13.0 | 11.8 | | 10.7 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Selling and | -3 933 | 413 | -3 520 | -4 380 | 341 | -4 039 |
| marketing | | | | | | |
| expenses 4) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 9.6 | | 8.6 | 8.6 | | 8.0 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Administrati | -1 145 | 103 | -1 042 | -1 284 | 163 | -1 121 |
| ve and | | | | | | |
| general | | | | | | |
| expenses 5) | | | | | | |
--------------------------------------------------------------------------------
| % of net | 2.8 | | 2.5 | 2.5 | | 2.2 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Other income | -1 080 | 1 071 | -9 | -775 | 599 | -176 |
| and expenses | | | | | | |
| 6) | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Operating | 1 197 | 2 306 | 3 503 | 4 966 | 2 067 | 7 033 |
| profit | | | | | | |
--------------------------------------------------------------------------------
| % of net | 2.9 | | 8.5 | 9.8 | | 13.9 |
| sales | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Share of | 30 | | 30 | 6 | | 6 |
| results of | | | | | | |
| associated | | | | | | |
| companies | | | | | | |
--------------------------------------------------------------------------------
| Financial | -265 | | -265 | -2 | | -2 |
| income and | | | | | | |
| expenses | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit | 962 | 2 306 | 3 268 | 4 970 | 2 067 | 7 037 |
| before tax | | | | | | |
--------------------------------------------------------------------------------
| Tax | -702 | -174 | -876 | -1 081 | -593 | -1 674 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit | 260 | 2 132 | 2 392 | 3 889 | 1 474 | 5 363 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Profit | 891 | 1 564 | 2 455 | 3 988 | 1 088 | 5 076 |
| attributable | | | | | | |
| to equity | | | | | | |
| holders of | | | | | | |
| the parent | | | | | | |
--------------------------------------------------------------------------------
| Profit/loss | -631 | 568 | -63 | -99 | 386 | 287 |
| attributable | | | | | | |
| to minority | | | | | | |
| interests | | | | | | |
--------------------------------------------------------------------------------
| | 260 | 2 132 | 2 392 | 3 889 | 1 474 | 5 363 |
--------------------------------------------------------------------------------
| Earnings per share, EUR (for profit attributable of the parent) |
| to the equity holders |
--------------------------------------------------------------------------------
| Basic | 0.24 | 0.42 | 0.66 | 1.07 | 0.29 | 1.36 |
--------------------------------------------------------------------------------
| Diluted | 0.24 | 0.42 | 0.66 | 1.05 | 0.29 | 1.34 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Average number of shares |
| (1 000 shares) |
--------------------------------------------------------------------------------
| Basic | 3705116 | | 3705116 | 3743622 | | 3743622 |
--------------------------------------------------------------------------------
| Diluted | 3721072 | | 3721072 | 3780363 | | 3780363 |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Depreciation | 1784 | -854 | 930 | 1617 | -694 | 923 |
| and | | | | | | |
| amortization | | | | | | |
| , total | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| Share-based | 13 | - | 13 | 67 | - | 67 |
| compensation | | | | | | |
| expense, | | | | | | |
| total | | | | | | |
--------------------------------------------------------------------------------
| | | | | | | |
--------------------------------------------------------------------------------
| 1) Deferred revenue related to acquisitions of EUR 3 million in 2009 and EUR |
| 12 million in 2008. |
--------------------------------------------------------------------------------
| 2) Restructuring charges of EUR 151 million and amortization of acquired |
| intangible assets of EUR 1 million in 2009. |
| Restructuring charges of EUR 402 million in 2008. |
--------------------------------------------------------------------------------
| 3) Restructuring charges of EUR 30 million and amortization of acquired |
| intangible assets of EUR 534 million in 2009. Restructuring charges of EUR |
| 46 million, amortization of acquired intangibles of EUR 351 million and EUR |
| 153 million representing the contribution of assets to Symbian Foundation in |
| 2008. |
--------------------------------------------------------------------------------
| 4) Restructuring charges of EUR 12 million and amortization of acquired |
| intangible assets of EUR 401 million in 2009. Reversal of restructuring |
| charges of 14 million, EUR 12 million representing the contribution of |
| assets to Symbian Foundation and amortization of acquired intangible assets |
| of EUR 343 million in 2008. |
--------------------------------------------------------------------------------
| 5) Restructuring charges of EUR 103 million in 2009 and EUR 163 million in |
| 2008. |
--------------------------------------------------------------------------------
| 6) Restructuring charges of EUR 192 million, amortization of acquired |
| intangible assets of EUR 5 million, impairment of goodwill of EUR 908 |
| million, impairment of assets EUR 56 million, a gain on sale of security |
| appliance business of EUR 68 million and a gain on sale of real estate of |
| EUR 22 million in 2009. Restructuring charges of EUR 446 million, |
| amortization of acquired intangible assets of EUR 1 million and transfer of |
| pension liability in Finland of EUR 152 million in 2008. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED INCOME STATEMENT, IFRS, EUR million | |
--------------------------------------------------------------------------------
| (1-12/2009 unaudited, 1-12/2008 audited) | |
--------------------------------------------------------------------------------
| | 1-12/2009* | 1-12/2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net sales | 40 984 | 50 710 |
--------------------------------------------------------------------------------
| Cost of sales | -27 720 | -33 337 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross profit | 13 264 | 17 373 |
--------------------------------------------------------------------------------
| Research and development expenses | -5 909 | -5 968 |
--------------------------------------------------------------------------------
| Selling and marketing expenses | -3 933 | -4 380 |
--------------------------------------------------------------------------------
| Administrative and general expenses | -1 145 | -1 284 |
--------------------------------------------------------------------------------
| Impairment of goodwill | -908 | - |
--------------------------------------------------------------------------------
| Other income | 338 | 420 |
--------------------------------------------------------------------------------
| Other expenses | -510 | -1 195 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Operating profit | 1 197 | 4 966 |
--------------------------------------------------------------------------------
| Share of results of associated companies | 30 | 6 |
--------------------------------------------------------------------------------
| Financial income and expenses | -265 | -2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit/loss before tax | 962 | 4 970 |
--------------------------------------------------------------------------------
| Tax | -702 | -1 081 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit | 260 | 3 889 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit attributable to equity holders of | 891 | 3 988 |
| the parent | | |
--------------------------------------------------------------------------------
| Profit/loss attributable to minority | -631 | -99 |
| interests | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | 260 | 3 889 |
--------------------------------------------------------------------------------
| Earnings per share, EUR | | |
--------------------------------------------------------------------------------
| (for profit attributable to the equity holders of the | |
| parent) | |
--------------------------------------------------------------------------------
| Basic | 0.24 | 1.07 |
--------------------------------------------------------------------------------
| Diluted | 0.24 | 1.05 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Average number of shares (1 000 shares) | |
--------------------------------------------------------------------------------
| Basic | 3 705 116 | 3 743 622 |
--------------------------------------------------------------------------------
| Diluted | 3 721 072 | 3 780 363 |
--------------------------------------------------------------------------------
| | | |
--------------------------------------------------------------------------------
| Depreciation and amortization, total | 1 784 | 1 617 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share-based compensation expense, total | 13 | 67 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME, IFRS, EUR million |
--------------------------------------------------------------------------------
| (1-12/2009 unaudited, 31.12.2008 audited) | | |
--------------------------------------------------------------------------------
| | 1-12/2009* | 1-12/2008 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Profit | 260 | 3 889 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive income | | | |
--------------------------------------------------------------------------------
| Translation differences | -563 | 595 | |
--------------------------------------------------------------------------------
| Net investment hedge gains | 114 | -123 | |
--------------------------------------------------------------------------------
| Cash flow hedges | 25 | -40 | |
--------------------------------------------------------------------------------
| Available-for-sale investments | 48 | -15 | |
--------------------------------------------------------------------------------
| Other increase/decrease, net | -7 | 28 | |
--------------------------------------------------------------------------------
| Income tax related to components of other | | |
--------------------------------------------------------------------------------
| comprehensive income | -44 | 58 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other comprehensive income, net of tax | -427 | 503 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income/expense | -167 | 4 392 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total comprehensive income/expense attributable to | | |
--------------------------------------------------------------------------------
| equity holders of the parent | 429 | 4 577 | |
--------------------------------------------------------------------------------
| minority interests | -596 | -185 | |
--------------------------------------------------------------------------------
| | -167 | 4 392 | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF FINANCIAL POSITION, IFRS, EUR million |
--------------------------------------------------------------------------------
| (31.12.2009 unaudited, 31.12.2008 audited) | | |
--------------------------------------------------------------------------------
| ASSETS | 31.12.2009* | 31.12.2008 |
--------------------------------------------------------------------------------
| Non-current assets | | |
--------------------------------------------------------------------------------
| Capitalized development costs | 143 | 244 |
--------------------------------------------------------------------------------
| Goodwill | 5 171 | 6 257 |
--------------------------------------------------------------------------------
| Other intangible assets | 2 762 | 3 913 |
--------------------------------------------------------------------------------
| Property, plant and equipment | 1 867 | 2 090 |
--------------------------------------------------------------------------------
| Investments in associated companies | 69 | 96 |
--------------------------------------------------------------------------------
| Available-for-sale investments | 554 | 512 |
--------------------------------------------------------------------------------
| Deferred tax assets | 1 507 | 1 963 |
--------------------------------------------------------------------------------
| Long-term loans receivable | 46 | 27 |
--------------------------------------------------------------------------------
| Other non-current assets | 6 | 10 |
--------------------------------------------------------------------------------
| | 12 125 | 15 112 |
--------------------------------------------------------------------------------
| Current assets | | |
--------------------------------------------------------------------------------
| Inventories | 1 865 | 2 533 |
--------------------------------------------------------------------------------
| Accounts receivable | 7 981 | 9 444 |
--------------------------------------------------------------------------------
| Prepaid expenses and accrued income | 4 551 | 4 538 |
--------------------------------------------------------------------------------
| Current portion of long-term loans receivable | 14 | 101 |
--------------------------------------------------------------------------------
| Other financial assets | 329 | 1 034 |
--------------------------------------------------------------------------------
| Investments at fair value through profit and | 580 | - |
| loss, liquid assets | | |
--------------------------------------------------------------------------------
| Available-for-sale investments, liquid assets | 2 367 | 1 272 |
--------------------------------------------------------------------------------
| Available-for-sale investments, cash | 4 784 | 3 842 |
| equivalents | | |
--------------------------------------------------------------------------------
| Bank and cash | 1 142 | 1 706 |
--------------------------------------------------------------------------------
| | 23 613 | 24 470 |
--------------------------------------------------------------------------------
| Total assets | 35 738 | 39 582 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SHAREHOLDERS' EQUITY AND LIABILITIES | |
--------------------------------------------------------------------------------
| Capital and reserves attributable to equity holders of the parent |
--------------------------------------------------------------------------------
| Share capital | 246 | 246 |
--------------------------------------------------------------------------------
| Share issue premium | 279 | 442 |
--------------------------------------------------------------------------------
| Treasury shares | -681 | -1 881 |
--------------------------------------------------------------------------------
| Translation differences | -127 | 341 |
--------------------------------------------------------------------------------
| Fair value and other reserves | 69 | 62 |
--------------------------------------------------------------------------------
| Reserve for invested non-restricted equity | 3 170 | 3 306 |
--------------------------------------------------------------------------------
| Retained earnings | 10 132 | 11 692 |
--------------------------------------------------------------------------------
| | 13 088 | 14 208 |
--------------------------------------------------------------------------------
| Minority interests | 1 661 | 2 302 |
--------------------------------------------------------------------------------
| Total equity | 14 749 | 16 510 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-current liabilities | | |
--------------------------------------------------------------------------------
| Long-term interest-bearing liabilities | 4 432 | 861 |
--------------------------------------------------------------------------------
| Deferred tax liabilities | 1 303 | 1 787 |
--------------------------------------------------------------------------------
| Other long-term liabilities | 66 | 69 |
--------------------------------------------------------------------------------
| | 5 801 | 2 717 |
--------------------------------------------------------------------------------
| Current liabilities | | |
--------------------------------------------------------------------------------
| Current portion of long-term loans | 44 | 13 |
--------------------------------------------------------------------------------
| Short-term borrowing | 727 | 3 578 |
--------------------------------------------------------------------------------
| Other financial liabilities | 245 | 924 |
--------------------------------------------------------------------------------
| Accounts payable | 4 950 | 5 225 |
--------------------------------------------------------------------------------
| Accrued expenses | 6 504 | 7 023 |
--------------------------------------------------------------------------------
| Provisions | 2 718 | 3 592 |
--------------------------------------------------------------------------------
| | 15 188 | 20 355 |
--------------------------------------------------------------------------------
| Total shareholders' equity and liabilities | 35 738 | 39 582 |
--------------------------------------------------------------------------------
| Interest-bearing liabilities | 5 203 | 4 452 |
--------------------------------------------------------------------------------
| Shareholders' equity per share, EUR | 3.53 | 3.84 |
--------------------------------------------------------------------------------
| Number of shares (1 000 shares) 1) | 3 708 262 | 3 697 872 |
--------------------------------------------------------------------------------
| 1) Shares owned by Group companies are excluded. | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF CASH FLOWS, IFRS, EUR million |
--------------------------------------------------------------------------------
| (1-12/2009 unaudited, 1-12/2008 audited) |
--------------------------------------------------------------------------------
| | 1-12/2009 | 1-12/2008 |
| | * | |
--------------------------------------------------------------------------------
| Cash flow from operating activities | | |
--------------------------------------------------------------------------------
| Profit attributable to equity holders of the parent | 891 | 3 988 |
--------------------------------------------------------------------------------
| Adjustments, total | 3 390 | 3 469 |
--------------------------------------------------------------------------------
| Change in net working capital | 140 | -2 546 |
--------------------------------------------------------------------------------
| Cash generated from operations | 4 421 | 4 911 |
--------------------------------------------------------------------------------
| Interest received | 125 | 416 |
--------------------------------------------------------------------------------
| Interest paid | -256 | -155 |
--------------------------------------------------------------------------------
| Other financial income and expenses, net | -128 | -195 |
--------------------------------------------------------------------------------
| Income taxes paid | -915 | -1 780 |
--------------------------------------------------------------------------------
| Net cash from operating activities | 3 247 | 3 197 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from investing activities | | |
--------------------------------------------------------------------------------
| Acquisition of Group companies, net of acquired cash | -29 | -5 962 |
--------------------------------------------------------------------------------
| Purchase of current available-for-sale investments, | -2 800 | -669 |
| liquid assets | | |
--------------------------------------------------------------------------------
| Purchase of investments at fair value through profit | -695 | - |
| and loss, liquid assets | | |
--------------------------------------------------------------------------------
| Purchase of non-current available-for-sale | -95 | -121 |
| investments | | |
--------------------------------------------------------------------------------
| Purchase of shares in associated companies | -30 | -24 |
--------------------------------------------------------------------------------
| Additions to capitalized development costs | -27 | -131 |
--------------------------------------------------------------------------------
| Proceeds from repayment and sale of long-term loans | - | 129 |
| receivable | | |
--------------------------------------------------------------------------------
| Proceeds from (+) / payment of (-) other long-term | 2 | -1 |
| loans receivable | | |
--------------------------------------------------------------------------------
| Proceeds from (+) / payment of (-) short-term loans | 2 | -15 |
| receivable | | |
--------------------------------------------------------------------------------
| Capital expenditures | -531 | -889 |
--------------------------------------------------------------------------------
| Proceeds from disposal of shares in associated | 40 | 3 |
| companies | | |
--------------------------------------------------------------------------------
| Proceeds from disposal of businesses | 61 | 41 |
--------------------------------------------------------------------------------
| Proceeds from maturities and sale of current | 1 730 | 4 664 |
| available-for-sale investments, liquid assets | | |
--------------------------------------------------------------------------------
| Proceeds from maturities and sale of investments at | 108 | - |
| fair value through profit and loss, liquid assets | | |
--------------------------------------------------------------------------------
| Proceeds from sale of non-current available-for-sale | 14 | 10 |
| investments | | |
--------------------------------------------------------------------------------
| Proceeds from sale of fixed assets | 100 | 54 |
--------------------------------------------------------------------------------
| Dividends received | 2 | 6 |
--------------------------------------------------------------------------------
| Net cash used in investing activities | -2 148 | -2 905 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow from financing activities | | |
--------------------------------------------------------------------------------
| Proceeds from stock option exercises | - | 53 |
--------------------------------------------------------------------------------
| Purchase of treasury shares | - | -3 121 |
--------------------------------------------------------------------------------
| Proceeds from long-term borrowings | 3 901 | 714 |
--------------------------------------------------------------------------------
| Repayment of long-term borrowings | -209 | -34 |
--------------------------------------------------------------------------------
| Proceeds from (+) / payment of (-) short-term | -2 842 | 2 891 |
| borrowings | | |
--------------------------------------------------------------------------------
| Dividends paid | -1 546 | -2 048 |
--------------------------------------------------------------------------------
| Net cash used in financing activities | -696 | -1 545 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Foreign exchange adjustment | -25 | -49 |
--------------------------------------------------------------------------------
| Net increase (+) / decrease (-) in cash and cash | 378 | -1 302 |
| equivalents | | |
--------------------------------------------------------------------------------
| Cash and cash equivalents at beginning of period | 5 548 | 6 850 |
--------------------------------------------------------------------------------
| Cash and cash equivalents at end of period | 5 926 | 5 548 |
--------------------------------------------------------------------------------
| NB: The figures in the consolidated cash flow statement cannot be directly |
| traced from the balance sheet without additional information as a result of |
| acquisitions and disposals of subsidiaries and net foreign exchange |
| differences arising on consolidation. |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, IFRS, EUR million |
--------------------------------------------------------------------------------
| (31.12.2009 unaudited, 31.12.2008 audited) |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| | Share | Sha | Tre | Tran | Fair | Rese | Reta | Befo | Mino | Tota |
| | capita | re | asu | slat | valu | rve | ined | re | rity | l |
| | l | iss | ry | ion | e | for | earn | mino | inte | equi |
| | | ue | sha | diff | and | inve | ings | rity | rest | ty |
| | | pre | res | eren | othe | sted | | | | |
| | | miu | | ce | r | non- | | | | |
| | | m | | | rese | rest | | | | |
| | | | | | rves | rict | | | | |
| | | | | | | ed | | | | |
| | | | | | | equi | | | | |
| | | | | | | ty | | | | |
--------------------------------------------------------------------------------
| Balanc | 246 | 644 | -31 | -163 | 23 | 3299 | 1387 | 1477 | 2565 | 1733 |
| e at | | | 46 | | | | 0 | 3 | | 8 |
| Dec | | | | | | | | | | |
| 31, | | | | | | | | | | |
| 2007 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Transl | | | | 595 | | | | 595 | | 595 |
| a | | | | | | | | | | |
| tion | | | | | | | | | | |
| differ | | | | | | | | | | |
| rences | | | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | -91 | | | | -91 | | -91 |
| invest | | | | | | | | | | |
| ment | | | | | | | | | | |
| hedge | | | | | | | | | | |
| losses | | | | | | | | | | |
| , net | | | | | | | | | | |
| of tax | | | | | | | | | | |
--------------------------------------------------------------------------------
| Cash | | | | | 42 | | | 42 | -67 | -25 |
| flow | | | | | | | | | | |
| hedges | | | | | | | | | | |
| , net | | | | | | | | | | |
| of tax | | | | | | | | | | |
--------------------------------------------------------------------------------
| Available-for-s | | | | -3 | | | -3 | -2 | -5 |
| ale | | | | | | | | | |
| investments, | | | | | | | | | |
| net of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | 46 | 46 | -17 | 29 |
| increa | | | | | | | | | | |
| se, | | | | | | | | | | |
| net | | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | | 3988 | 3988 | -99 | 3889 |
--------------------------------------------------------------------------------
| Total | - | - | - | 504 | 39 | - | 4034 | 4577 | -185 | 4392 |
| compre | | | | | | | | | | |
| hensiv | | | | | | | | | | |
| e | | | | | | | | | | |
| income | | | | | | | | | | |
--------------------------------------------------------------------------------
| Stock | | | | | | 51 | | 51 | | 51 |
| option | | | | | | | | | | |
| s | | | | | | | | | | |
| exerci | | | | | | | | | | |
| sed | | | | | | | | | | |
--------------------------------------------------------------------------------
| Stock options | 1 | | | | | | 1 | | 1 |
| exercised | | | | | | | | | |
| related to | | | | | | | | | |
| acquisitions | | | | | | | | | |
--------------------------------------------------------------------------------
| Share- | | 74 | | | | | | 74 | | 74 |
| based | | | | | | | | | | |
| compen | | | | | | | | | | |
| sation | | | | | | | | | | |
--------------------------------------------------------------------------------
| Excess tax | -11 | | | | | | -117 | -6 | -123 |
| benefit on | 7 | | | | | | | | |
| share-based | | | | | | | | | |
| compensation | | | | | | | | | |
--------------------------------------------------------------------------------
| Settle | | -17 | 154 | | | -44 | | -69 | | -69 |
| ment | | 9 | | | | | | | | |
| of | | | | | | | | | | |
| perfor | | | | | | | | | | |
| m | | | | | | | | | | |
| ance | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Acquis | | | -31 | | | | | -312 | | -312 |
| i | | | 23 | | | | | 3 | | 3 |
| tion | | | | | | | | | | |
| of | | | | | | | | | | |
| treasu | | | | | | | | | | |
| ry | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Reissu | | | 2 | | | | | 2 | | 2 |
| ance | | | | | | | | | | |
| of | | | | | | | | | | |
| treasu | | | | | | | | | | |
| ry | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Cancel | | | 423 | | | | -423 | - | | - |
| lation | | | 2 | | | | 2 | | | |
| of | | | | | | | | | | |
| treasu | | | | | | | | | | |
| ry | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Divide | | | | | | | -199 | -199 | -35 | -202 |
| nd | | | | | | | 2 | 2 | | 7 |
--------------------------------------------------------------------------------
| Acquisitions | | | | | | | - | -37 | -37 |
| and other | | | | | | | | | |
| changes in | | | | | | | | | |
| minority | | | | | | | | | |
| interests | | | | | | | | | |
--------------------------------------------------------------------------------
| Vested portion | 19 | | | | | | 19 | | 19 |
| of share-based | | | | | | | | | |
| payment awards | | | | | | | | | |
| related to | | | | | | | | | |
| acquisitions | | | | | | | | | |
--------------------------------------------------------------------------------
| Acquisiti | | | | | | | 12 | 12 | | 12 |
| on of | | | | | | | | | | |
| Symbian | | | | | | | | | | |
--------------------------------------------------------------------------------
| Total of | - | -20 | 126 | - | - | 7 | -621 | -514 | -78 | -5 |
| other | | 2 | 5 | | | | 2 | 2 | | 220 |
| equity | | | | | | | | | | |
| movements | | | | | | | | | | |
--------------------------------------------------------------------------------
| Balance | 246 | 442 | -18 | 341 | 62 | 3306 | 1169 | 1420 | 2302 | 1651 |
| at Dec | | | 81 | | | | 2 | 8 | | 0 |
| 31, 2008 | | | | | | | | | | |
--------------------------------------------------------------------------------
| Translati | | | | -552 | | | | -552 | -9 | -561 |
| on | | | | | | | | | | |
| differenc | | | | | | | | | | |
| es | | | | | | | | | | |
--------------------------------------------------------------------------------
| Net | | | | 84 | | | | 84 | | 84 |
| investmen | | | | | | | | | | |
| t hedge | | | | | | | | | | |
| gains, | | | | | | | | | | |
| net of | | | | | | | | | | |
| tax | | | | | | | | | | |
--------------------------------------------------------------------------------
| Cash flow | | | | | -35 | | | -35 | 49 | 14 |
| hedges, | | | | | | | | | | |
| net of | | | | | | | | | | |
| tax | | | | | | | | | | |
--------------------------------------------------------------------------------
| Available-for-s | | | | 42 | | | 42 | 2 | 44 |
| ale | | | | | | | | | |
| investments, | | | | | | | | | |
| net of tax | | | | | | | | | |
--------------------------------------------------------------------------------
| Other | | | | | | | -1 | -1 | -7 | -8 |
| increase, | | | | | | | | | | |
| net | | | | | | | | | | |
--------------------------------------------------------------------------------
| Profit | | | | | | | 891 | 891 | -631 | 260 |
--------------------------------------------------------------------------------
| Total | - | - | - | -468 | 7 | - | 890 | 429 | -596 | -167 |
| comprehen | | | | | | | | | | |
| d | | | | | | | | | | |
| sive | | | | | | | | | | |
| income | | | | | | | | | | |
--------------------------------------------------------------------------------
| Stock options | -1 | | | | | | -1 | | -1 |
| exercised | | | | | | | | | |
| related to | | | | | | | | | |
| acquisitions | | | | | | | | | |
--------------------------------------------------------------------------------
| Share-bas | | 16 | | | | | | 16 | | 16 |
| ed | | | | | | | | | | |
| compensa | | | | | | | | | | |
| tion | | | | | | | | | | |
--------------------------------------------------------------------------------
| Excess tax | -12 | | | | | | -12 | -1 | -13 |
| benefit on | | | | | | | | | |
| share-based | | | | | | | | | |
| compensation | | | | | | | | | |
--------------------------------------------------------------------------------
| Settlemen | | -16 | 230 | | | -136 | | -72 | | -72 |
| t of | | 6 | | | | | | | | |
| performan | | | | | | | | | | |
| ce shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Reissuanc | | | 1 | | | | | 1 | | 1 |
| e of | | | | | | | | | | |
| treasury | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Cancellat | | | 969 | | | | -969 | - | | - |
| ion of | | | | | | | | | | |
| treasury | | | | | | | | | | |
| shares | | | | | | | | | | |
--------------------------------------------------------------------------------
| Dividend | | | | | | | -148 | -148 | -44 | -152 |
| | | | | | | | 1 | 1 | | 5 |
--------------------------------------------------------------------------------
| Total of | - | -16 | 120 | - | - | -136 | -245 | -154 | -45 | -159 |
| other | | 3 | 0 | | | | 0 | 9 | | 4 |
| equity | | | | | | | | | | |
| movements | | | | | | | | | | |
--------------------------------------------------------------------------------
| Balance | 246 | 279 | -68 | -127 | 69 | 3170 | 1013 | 1308 | 1661 | 1474 |
| at Dec | | | 1 | | | | 2 | 8 | | 9 |
| 31, 2009* | | | | | | | | | | |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| COMMITMENTS AND CONTINGENCIES, EUR million |
--------------------------------------------------------------------------------
| (31.12.2009 unaudited, 31.12.2008 audited) |
--------------------------------------------------------------------------------
| | | GROUP | |
--------------------------------------------------------------------------------
| | | 31.12.2009* | 31.12.2008 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Collateral for own commitments | | | |
--------------------------------------------------------------------------------
| Property under mortgages | | 18 | 18 |
--------------------------------------------------------------------------------
| Assets pledged | | 13 | 11 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Contingent liabilities on behalf of Group | | |
| companies | | |
--------------------------------------------------------------------------------
| Guarantees for loans | | - | - |
--------------------------------------------------------------------------------
| Other guarantees | | 1 350 | 2 896 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Contingent liabilities on behalf of other | | |
| companies | | |
--------------------------------------------------------------------------------
| Financial guarantees on behalf of third | - | 2 |
| parties | | |
--------------------------------------------------------------------------------
| Other guarantees | | 3 | 1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Leasing obligations | | 1 218 | 1 156 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Financing commitments | | | |
--------------------------------------------------------------------------------
| Customer finance commitments | | 85 | 197 |
--------------------------------------------------------------------------------
| Venture fund commitments | | 293 | 467 |
--------------------------------------------------------------------------------
1 EUR = 1.465 USD
*All reported 2009 figures are unaudited and the auditors have not yet issued
their report for Nokia's financial statements for 2009.
The unaudited, consolidated interim financial statements of Nokia have been
prepared in accordance with the International Financial Reporting Standards
(“IFRS”). The same accounting policies and methods of computation are followed
in the interim financial statements as were followed in the consolidated
financial statements of Nokia for 2008.
FORWARD-LOOKING STATEMENTS
It should be noted that certain statements herein which are not historical
facts, including, without limitation, those regarding: A) the timing of product,
services and solution deliveries; B) our ability to develop, implement and
commercialize new products, services, solutions and technologies; C) our ability
to develop and grow our consumer Internet services business; D) expectations
regarding market developments and structural changes; E) expectations regarding
our mobile device volumes, market share, prices and margins; F) expectations and
targets for our results of operations; G) the outcome of pending and threatened
litigation; H) expectations regarding the successful completion of contemplated
acquisitions on a timely basis and our ability to achieve the set targets upon
the completion of such acquisitions; and I) statements preceded by "believe,""expect,""anticipate,""foresee,""target,""estimate,""designed,""plans,""will" or similar expressions are forward-looking statements. These statements
are based on management's best assumptions and beliefs in light of the
information currently available to it. Because they involve risks and
uncertainties, actual results may differ materially from the results that we
currently expect. Factors that could cause these differences include, but are
not limited to: 1) the deteriorating global economic conditions and related
financial crisis and their impact on us, our customers and end-users of our
products, services and solutions, our suppliers and collaborative partners; 2)
the development of the mobile and fixed communications industry, as well as the
growth and profitability of the new market segments that we target and our
ability to successfully develop or acquire and market products, services and
solutions in those segments; 3) the intensity of competition in the mobile and
fixed communications industry and our ability to maintain or improve our market
position or respond successfully to changes in the competitive landscape; 4)
competitiveness of our product, services and solutions portfolio; 5) our ability
to successfully manage costs; 6) exchange rate fluctuations, including, in
particular, fluctuations between the euro, which is our reporting currency, and
the US dollar, the Japanese yen, the Chinese yuan and the UK pound sterling, as
well as certain other currencies; 7) the success, financial condition and
performance of our suppliers, collaboration partners and customers; 8) our
ability to source sufficient amounts of fully functional components,
sub-assemblies, software and content without interruption and at acceptable
prices; 9) the impact of changes in technology and our ability to develop or
otherwise acquire and timely and successfully commercialize complex technologies
as required by the market; 10) the occurrence of any actual or even alleged
defects or other quality, safety or security issues in our products, services
and solutions; 11) the impact of changes in government policies, trade policies,
laws or regulations or political turmoil in countries where we do business; 12)
our success in collaboration arrangements with others relating to development of
technologies or new products, services and solutions; 13) our ability to manage
efficiently our manufacturing and logistics, as well as to ensure the quality,
safety, security and timely delivery of our products, services and solutions;
14) inventory management risks resulting from shifts in market demand; 15) our
ability to protect the complex technologies, which we or others develop or that
we license, from claims that we have infringed third parties' intellectual
property rights, as well as our unrestricted use on commercially acceptable
terms of certain technologies in our products, services and solutions; 16) our
ability to protect numerous Nokia, NAVTEQ and Nokia Siemens Networks patented,
standardized or proprietary technologies from third-party infringement or
actions to invalidate the intellectual property rights of these technologies;
17) any disruption to information technology systems and networks that our
operations rely on; 18) developments under large, multi-year contracts or in
relation to major customers; 19) the management of our customer financing
exposure; 20) our ability to retain, motivate, develop and recruit appropriately
skilled employees; 21) whether, as a result of investigations into alleged
violations of law by some former employees of Siemens AG ("Siemens"), government
authorities or others take further actions against Siemens and/or its employees
that may involve and affect the carrier-related assets and employees transferred
by Siemens to Nokia Siemens Networks, or there may be undetected additional
violations that may have occurred prior to the transfer, or violations that may
have occurred after the transfer, of such assets and employees that could result
in additional actions by government authorities; 22) any impairment of Nokia
Siemens Networks customer relationships resulting from the ongoing government
investigations involving the Siemens carrier-related operations transferred to
Nokia Siemens Networks; 23) unfavorable outcome of litigations; 24) allegations
of possible health risks from electromagnetic fields generated by base stations
and mobile devices and lawsuits related to them, regardless of merit; as well as
the risk factors specified on pages 11-28 of Nokia's annual report on Form 20-F
for the year ended December 31, 2008 under Item 3D. "Risk Factors." Other
unknown or unpredictable factors or underlying assumptions subsequently proving
to be incorrect could cause actual results to differ materially from those in
the forward-looking statements. Nokia does not undertake any obligation to
publicly update or revise forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent legally required.
Nokia, Helsinki - January 28, 2010
Media and Investor Contacts:
Corporate Communications, tel. +358 7180 34900
Investor Relations Europe, tel. +358 7180 34927
Investor Relations US, tel. +1 914 368 0555
- Nokia plans to report its quarterly results in 2010 on the following dates: Q1
on April 22, Q2 on July 22 and Q3 on October 21, 2010.
- Nokia plans to publish its annual report, Nokia in 2009, in week 12 of 2010.
- Nokia's Annual General Meeting will be held on May 6, 2010.
www.nokia.com
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