Nokia
announced that it is today filing its annual report on Form 20-F for
2012 with the US Securities and Exchange Commission. In the report,
Nokia reiterates longer-term financial targets, and provides additional
information in relation to its agreement with Microsoft. Shareholders may request a hard copy of the report free of charge through Nokia's Internet pages.
Longer-term financial targets
In
this annual report, Nokia reiterated its longer-term financial targets
for its Devices & Services business and Nokia Siemens Networks.
Longer-term, Nokia continues to target:
- Devices & Services net sales to grow faster than the market.- Devices & Services non-IFRS operating margin to be 10% or more.
Longer-term, Nokia Siemens Networks continues to target for its non-IFRS operating margin to be between 5% and 10%.
Additional disclosure on Microsoft agreement
This
annual report also includes additional information in relation to
Nokia's agreement with Microsoft, including mainly the following:
-
The remaining minimum software royalty commitment payments from Nokia
to Microsoft are expected to exceed the remaining platform support
payments from Microsoft to Nokia by a total of approximately EUR 0.5
billion over the remaining life of the agreement.-
However, in 2013 the amount of the platform support payments from
Microsoft to Nokia is still expected to slightly exceed the total amount
of the minimum software royalty commitment payments from Nokia to
Microsoft.
This
release includes information on a non-IFRS, or underlying business
performance, basis. Non-IFRS information excludes special items for all
periods. In addition, non-IFRS results exclude intangible asset
amortization, other purchase price accounting related items and
inventory value adjustments arising from the formation of Nokia Siemens
Networks and from all business acquisitions. Nokia believes that
non-IFRS financial measures provide meaningful supplemental information
to both management and investors regarding Nokia's performance by
excluding the above-described items that may not be indicative of
Nokia's business operating results. Non-IFRS financial measures should
not be viewed in isolation or as substitutes to the equivalent IFRS
measure(s), but should be used in conjunction with the most directly
comparable IFRS measure(s) in the reported results.
FORWARD-LOOKING STATEMENTS
It should be noted that Nokia and its business are exposed to various risks and uncertainties and certain statements herein that are not historical facts are forward-looking statements, including, without limitation, those regarding:
It should be noted that Nokia and its business are exposed to various risks and uncertainties and certain statements herein that are not historical facts are forward-looking statements, including, without limitation, those regarding:
A) the expected plans and benefits of our
partnership with Microsoft to bring together complementary assets and
expertise to form a global mobile ecosystem for smartphones;
B) the
timing and expected benefits of our strategies, including expected
operational and financial benefits and targets as well as changes in
leadership and operational structure;
C) the timing of the deliveries of
our products and services;
D) our ability to innovate, develop, execute
and commercialize new technologies, products and services;
E)
expectations regarding market developments and structural changes;
F)
expectations and targets regarding our industry volumes, market share,
prices, net sales and margins of our products and services;
G)
expectations and targets regarding our operational priorities and
results of operations;
H) expectations and targets regarding
collaboration and partnering arrangements;
I) the outcome of pending and
threatened litigation, regulatory proceedings or investigations by
authorities;
J) expectations regarding the successful completion of restructurings,
investments, acquisitions and divestments on a timely basis and our
ability to achieve the financial and operational targets set in
connection with any such restructurings, investments, acquisitions and
divestments; and
K) statements preceded by "believe," "expect,"
"anticipate," "foresee," "target," "estimate," "designed," "aim",
"plans," "intends," "will" or similar expressions. These statements are
based on management's best assumptions and beliefs in light of the
information currently available to it. Because they involve risks and
uncertainties, actual results may differ materially from the results
that we currently expect.
Factors, including risks and uncertainties
that could cause these differences include, but are not limited to:
1)
our ability to make the Windows Phone ecosystem a competitive and
profitable global ecosystem that achieves sufficient scale, value and
attractiveness to relevant market participants, making Nokia products
with Windows Phone a competitive choice for consumers;
2) our success in
the smartphone market, including our ability to introduce and bring to
market quantities of attractive, competitively priced Nokia products
with Windows Phone that are positively differentiated from our
competitors' products, both outside and within the Windows Phone
ecosystem;
3) our ability to produce attractive and competitive devices
in our Mobile Phones business unit, including feature phones and devices
with features such as full touch that can be categorized as
smartphones, in a timely and cost efficient manner with differentiated
hardware, software, localized services and applications;
4) the success
of our HERE strategy, including our ability to establish a successful
location-based platform and extend our location-based services across
devices and operating systems;
5) our ability to provide support for our
Devices & Services business and maintain current and create new
sources of revenue from our location-based service and commerce assets;
6) our ability to protect numerous patented standardized or proprietary
technologies from third-party infringement or actions to invalidate the
intellectual property rights of these technologies;
7) our ability to
maintain the existing sources of intellectual property related revenue
and establish new such sources;
8) the intensity of competition in the
various markets where we do business and our ability to maintain or
improve our market position or respond successfully to changes in the
competitive environment;
9) our ability to keep momentum and increase
our speed of innovation, product development and execution in order to
bring new innovative and competitive mobile products and location-based
or other services to the market in a timely manner;
10) the success of
our partnership with Microsoft in connection with the Windows Phone
ecosystem;
11) our ability to effectively and smoothly implement the
planned changes in our operational structure and achieve targeted
efficiencies and reductions in operating expenses;
12) our ability to
retain, motivate, develop and recruit appropriately skilled employees;
13) our dependence on the development of the mobile and communications
industry, including location-based and other services industries, in
numerous diverse markets, as well as on general economic conditions
globally and regionally;
14) our ability to maintain and leverage our
traditional strengths in the mobile products market, especially if we
are unable retain the loyalty of our mobile operator and distributor
customers and consumers as a result of the implementation of our
strategies or other factors;
15) the performance of the parties we
partner and collaborate with, including Microsoft and our ability to
achieve successful collaboration or partnering arrangements;
16) our
ability to deliver our mobile products profitably, in line with quality
requirements and on time, especially if the limited number of suppliers
we depend on fail to deliver sufficient quantities of fully functional
products, components, sub-assemblies, software and services on
favourable terms and in compliance with our supplier requirements;
17)
our ability to manage efficiently our manufacturing and logistics, as
well as to ensure the quality, safety, security and timely delivery of
our products and services;
18) any actual or even alleged defects or
other quality, safety and security issues in our products;
19) any
inefficiency, malfunction or disruption of a system or network that our
operations rely on;
20) the impact of cyber security breach or other
factors leading to an actual or alleged loss, improper disclosure or
leakage of any personal or consumer data collected by us or our partners
or subcontractors, made available to us or stored in or through our
products;
21) our ability to successfully manage the pricing of our
products and costs related to our products and our operations;
22) the
potential complex tax issues and obligations we may face, including the
obligation to pay additional taxes in various jurisdictions and our
actual or anticipated performance, among other factors, could result in
allowances related to deferred tax assets;
23) exchange rate
fluctuations, particularly between the euro, which is our reporting
currency, and the US dollar, the Japanese yen and the Chinese yuan, as
well as certain other currencies;
24) our ability to protect the
technologies, which we or others develop or which we license, from
claims that we have infringed third parties' intellectual property
rights, as well as our unrestricted use on commercially acceptable terms
of certain technologies in our product and services;
25) the impact of
economic, regulatory, political or other development on our sales,
manufacturing facilities and assets located in emerging market countries
as well as the impact of regulations against imports to those
countries;
26) the impact of changes in and enforcement of government
policies, technical standards, trade policies, laws or regulations in
countries where our assets are located and where we do business;
27)
investigations or claims by contracting parties in relation to exits
from countries, areas or contractual arrangements;
28) unfavorable
outcome of litigation, regulatory proceedings or investigations by
authorities;
29) allegations of possible health risks from
electromagnetic fields generated by base stations and mobile devices,
and the lawsuits and publicity related to them, regardless of merit;
30)
Nokia Siemens Networks' success in the mobile broadband infrastructure
and related services market and its ability to effectively, profitably
and timely adapt business and operations to the diverse needs of its
customers;
31) Nokia Siemens Networks' ability to maintain and improve
its market position and respond successfully to changes and competition
in the mobile broadband infrastructure and related services market;
32)
Nokia Siemens Networks' success in implementing its restructuring plan
and reducing its operating expenses and other costs;
33) Nokia Siemens
Networks' ability to invest in and timely introduce new competitive
products, services, upgrades and technologies;
34) Nokia Siemens
Networks' dependence on limited number of customers and large,
multi-year contracts;
35) Nokia Siemens Networks' liquidity and its
ability to meet its working capital requirements, including access to
available credit under its financing arrangements and other credit lines
as well as cash at hand;
36) the management of Nokia Siemens Networks'
customer financing exposure;
37) whether ongoing or any additional
governmental investigations of alleged violations of law by some former
employees of Siemens may involve and affect the carrier-related assets
and employees transferred by Siemens to Nokia Siemens Networks;
38) any
impairment of Nokia Siemens Networks customer relationships resulting
from ongoing or any additional governmental investigations involving the
Siemens carrier-related operations transferred to Nokia Siemens
Networks, as well as the risk factors specified on pages 12-47 of
Nokia's annual report on Form 20-F for the year ended December 31, 2012
under Item 3D.
"Risk Factors." Other unknown or unpredictable factors or
underlying assumptions subsequently proving to be incorrect could cause
actual results to differ materially from those in the forward-looking
statements. Nokia does not undertake any obligation to publicly update
or revise forward-looking statements, whether as a result of new
information, future events or otherwise, except to the extent legally
required.
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