Alcatel-Lucent Posts Wider Q2 Loss On Charges; Revenues Up

(RTTNews) - French telecom-equipment maker Alcatel-Lucent SA (ALU) reported Tuesday a wider net loss in its second quarter, hurt by hefty restructuring and asset impairment charges, consistent with its previously announced "The Shift Plan". Revenues edged up with improved performance in IP division and North America, despite poor performance in all other regions.

Chief Executive Officer Michel Combes said, "We are at the beginning of our journey towards 2015 and cash remains a challenge. Looking ahead, our clear focus will be maintaining a strict and disciplined approach to implementing The Shift Plan across all of its industrial, operational and financial dimensions."

In Paris, Alcatel-Lucent shares are currently trading at 1.73 euros, up 0.14 euros or 8.65 percent.

For the second quarter, the company's net loss -group share was 885 million euros, compared with last year's loss of 396 million euros. On a per share basis, loss was 0.39 euro, wider than loss of 0.17 euro a year ago. In US dollar currency, loss per share widened to $0.51 per American depository share or ADS, from $0.22 per ADS loss a year ago.

The latest-quarter results included restructuring charges of 194 million euros, an asset impairment charge of 552 million euros, and 180 million euros of financial loss. The results also included Purchase Price Adjustments.

The company's adjusted net loss, which excluded Purchase Price Adjustments, but included all other charges, was 871 million euros or 0.38 euro per share, or $0.50 per ADS loss.

Quarterly revenues edged up 1.9 percent to 3.61 billion from the prior year's 3.55 billion euros. Revenues increased 3.7 percent at constant currency, with particularly strong growth of more than 25 percent in its IP division, at constant exchange rates.

Revenues for the IP division were driven by strength in edge routers and carrier ethernet switches across all regions.

From a geographic standpoint, North America was the key driver for the total Group growth, with revenue growth of 17 percent, while all other regions performed badly. In Asia Pacific, weakness in China was partially offset by continuous good traction in Japan. Western Europe showed encouraging trends in the quarter.

As part of The Shift Plan, which was announced in June, the company said it intends to take advantage of further debt market opportunities. This is a key part of The Shift Plan. The measures already implemented mean Alcatel-Lucent has less than 450 million euros in debt maturities before 2016.

The company's three-year plan is aimed at repositioning it as a specialist provider of IP Networking and Ultra-Broadband Access. The plan targets 1 billion euros in fixed cost savings and asset sales of more than 1 billion euros over 2013-2015.

On the NYSE, Alcatel-Lucent shares closed Tuesday's trading at $2.20, up $0.08 or 3.77 percent. In the extended trading, shares increased 3.64 percent further to close at $2.28.