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Alcatel reports full-year profit on strong wireless revenues

PARIS-Alcatel Corp.’s shares fell on its fourth-quarter result, although the company’s mobile business experienced a surge.

The company, however, had its first full-year profit in three years with $365 million in contrast to a loss of $2.5 billion in 2003. Its 2004 sales went up 10.7 percent to $4.92 billion compared with the previous year of $4.5 billion. Its income from operations also jumped 10.3 percent to $509.5 million over the previous year.

For the quarter, the net income was a paltry $51 million, although it suffered a loss of $679.3 million in the year-ago quarter. But in its mobile business, the vendor’s revenue leaped 27.2 percent to $1.38 billion from $1.09 billion in the year-ago period. Its income from operations was $180.2 million, representing a 12.9-percent return on sales.

The company said its wireless business benefited from strong growth in emerging markets like Russia, Brazil, Algeria, Nigeria and Thailand.

“In terms of business, we expect a positive inflection in fixed communications by mid-year, with our sales fueled by the triple-play momentum, a continuation of our growth in mobile communications, due to our good positioning in emerging markets, and significant progress to be achieved in vertical markets for our private communications group,” said Alcatel Chief Executive Officer Derge Tchuruk.

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