Ericsson Q4 Profit Increases - Quick Facts

(RTTNews) - Swedish telecom equipment maker Ericsson (ERIC) reported that its fourth-quarter net income attributable to owners of the parent company increased to 10.08 billion Swedish kronor or 3.02 kronor per share from the prior year's 7.52 billion kronor or 2.26 kronor per share, reflecting lower reported taxes and improved EBIT.

Group reported sales for the fourth quarter increased by 3% year-over-year to 71.3 billion kronor. Sales adjusted for comparable units and currency grew by 2%, driven primarily by 5G deployments in market areas North America and Europe and Latin America as well as by growth in Digital Services in Middle East and Africa. Sales in Mainland China in Networks and Digital Services declined by 1.8 billion kronor, impacting the growth rate adjusted for comparable units and currency by -3 percentage points.

The company said its board has proposed to the Annual General Meeting a dividend to the shareholders of 2.50 kronor per share for the financial year 2021, compared to 2.00 kronor per share paid last year. Should the Annual General Meeting decide in favor of the proposal, payment of the dividend is expected to be made on April 5, 2022, and on October 5, 2022.

The company stated that the Group EBIT target for 2022 of 12%-14% remains, excluding the Vonage-related segment. With the different business mix compared to when the company set the 2022 target back in 2018, the target becomes less relevant, and key focus is therefore now to accelerate the pace towards reaching its long-term target of EBITA margin of 15-18%. After delivering an EBITA margin of 14.6% in 2021, its ambition is to reach the long-term target no later than in 2-3 years.