Ericsson Q4 Profit Up 67%

(RTTNews) - Mobile network equipment maker Ericsson (ERIC) reported a profit for the fourth-quarter of 2015 that increased 67 percent from the prior year on higher licensing revenues and lower expenses.

Profitability improved year-over-year, with higher IPR licensing revenues and lower operating expenses as main contributors.

Looking ahead, Ericsson said it is confident in its ability to achieve 9 billion Swedish kronor cost and efficiency program by 2017.

Net income attributable to stockholders of the parent company for the fourth quarter surged to 7.06 billion kronor or 2.15 kronor per share from the prior year's 4.22 billion kronor or 1.29 kronor per share.

Non-IFRS earnings per share improved to 2.50 kronor from 1.71 kronor in the prior year.

Operating income surged 75 percent to 11.04 billion kronor from 6.30 billion kronor in the prior-year quarter. The increase was due to higher sales, lower operating expenses and reduced negative effect of currency hedge contracts. The net currency effect had a positive impact on operating income.

Net sales grew 8 percent to 73.57 billion kronor from 68.00 billion kronor. Sales, adjusted for comparable units and currency, decreased by 1 percent. Sales in the quarter were supported by high IPR licensing revenues.

The company stated that the strategic partnership with Cisco, announced in the quarter, will give it strong end-to-end network solutions with a complete IP portfolio.

As a result of the partnership, the company will extend its addressable market and expect to generate $1 billion or more of additional sales by 2018. Additional sales are expected to be accretive to operating income in 2016.

The Board of Directors will propose a dividend of 3.70 kronor per share for 2015, an increase of 9 percent compared with 3.40 kronor last year.