NEW YORK-Aided by strong growth in its mobile phones and telecommunications business groups, Nokia Corp. reported strong second-quarter net sales Aug. 8 of nearly $1.9 billion, a 17 percent increase from the same period 1995.
Operating profits for the quarter, which ended June 30, were almost $177.4 million, representing 9.2 percent of net sales. The conversion into American dollars is based on the exchange June 30 of one Finnish markka equaling 0.215 U.S. dollars. Nokia is headquartered in Helsinki.
“Nokia’s net sales growth and operating profit developed positively from the first quarter of the year,” said Jorma Ollila, president and chief executive officer. “We met targets for the second quarter, while as anticipated, profits stayed below their 1995 levels.”
After a “loss-making first quarter,” Nokia Mobile Phones net sales reached nearly $1.06 billion during the second quarter, a 30 percent increase from the same quarter last year. This business group recorded a “slight operating profit, but as expected, stayed on a significantly lower profit level than in the corresponding period in 1995,” stated the parent company.
Nokia Telecommunications Group, which develops and manufactures network systems for cellular and fixed networks, posted a 23 percent increase in net sales from the same 1995 quarter to $693.4 million.
As expected, Nokia General Communications Products group posted a decline in net sales due to three factors: Nokia’s sale of its cable business in March, the discontinuation of its television business at the end of 1995 and divestments of non-core businesses throughout last year, the company said.
As a result of these divestitures, “Nokia will have its total focus on the manufacturing and marketing of mobile phones, GSM/DCS cellular networks, transmission and access networks with related equipment, digital multimedia equipment and other telecom-related equipment,” Ollila said.
The company president predicted the environment will become increasingly competitive for the balance of this year.
“We expect Nokia Telecommunications to remain very competitive and to achieve strong growth and good profitability, and Nokia Mobile Phones to further improve over second quarter (1996) results,” Ollila stated. “Overall, we maintain our generally positive outlook, but as always, actual performance will depend on a variety of external factors, including overall development in our major market areas.”
