Nokia Corporation (ADR) (NYSE:NOK) 4Q Profit Surges 54%, Sees Some Market Headwinds In 2016

Nokia Corporation (ADR) (NYSE:NOK) 4Q Profit Surges 54%, Sees Some Market Headwinds In 2016

Nokia Corporation (ADR) (NYSE:NOK) said that its profit surged 54% in the fourth quarter driven by six percentage points improvement in its operating margin. Its gross margin also grew 5.6 percentage points in the same period as net sales advanced only 3%. The company also indicated that its board would propose a special dividend of €.10 cents a share apart from the regular dividend. The company also sees some market headwinds in the current year as the launch of 4G/LTE would slow in China, as well as, some other markets.

4Q Results

Nokia reported a profit of €499 million in the fourth quarter, up 54% from €325 million in the same quarter last year. Its earnings per share surged 63% to €.13 cents from eight cents in the same period. On a non-IRS basis, profit climbed 74% to €575 million from €331 million while earnings jumped 67% to €.15 cents a share from €.9 cents a share.

The company’s net sales grew 3% To €3.61 billion from €3.51 billion in the same quarter last year. While the networks division revenue slipped 5%, its technologies segment contributed 170% more revenue at €403 million. The company attributed the Technologies growth to the settled arbitration. Its gross margin rose to 46.4% from 40.8% while operating margin grew to 20.3% from 14.3% during the period under review.

Special Dividend

Nokia said that its board would propose a dividend of €.16 cents a share for the year 2015. Aside from that, it would also recommend a special dividend of €.10 cents a share, which was lower than € .14 cents a share paid in 2014. The company indicated that the regular dividend will involve a payout of €960 million while the special dividend would cost €600 million.

Moving ahead, Nokia said that the first quarter looks to be quite challenging. That was because customers started evaluating their plans for CAPEX following the growing ambiguity in macro-economic conditions. The company indicated that it would continue its focus on operational, as well as, commercial discipline to ensure synergies as soon as possible.