Gordana Kovačević, the president of Ericsson Nikola Tesla commented on the Company’s performance:

 

„Overall Ericsson Nikola Tesla results for the first quarter of 2011 show a decrease in Orders of 31% year-over-year, but at the same time, a 2% year-over-year increase in Sales and an improvement in Gross Margin and Operating Profit. Other financial indicators remain strong and after Cash flow from Operating activities of MHRK 60.7 total cash including short-term financial assets has increased to almost MHRK 793 at the end of the quarter. The Equity ratio at the end of the quarter was 79.2%.

 

Decline in Orders booked year-over-year is primarily attributable to reduced Orders of MHRK 130 in our export markets which reflects significant Q1 2010 Orders with Beltelekom, Belarus of MHRK 65 and a postponement of Q1 2011 activities in other export markets such as Bosnia & Herzegovina in line with the current political climate. Increase in total sales revenue is attributable to a 39% increase in the regional markets and a 12% increase in the Ericsson market which represents 38% of total sales for the quarter.

 

Activities in the Ericsson market remain strong and while we have made some adjustments to our pricing to remain competitive in the increasingly demanding global market, we have been awarded new responsibilities.

 

The challenging market conditions that prevailed in 2010 continued during Q1. Reduced investments in the domestic market reflect the decline of operators' revenues, saturated mobile market as well as existing penetration of both fixed and mobile broadband access. Adopting the Strategy of Broadband Access Development in Croatia, regulation of optic fiber broadband access and the expected additional growth of mobile broadband due to the increase in number of smart phones and other broadband mobile devices, will influence the need for infrastructure in terms of both capacity and service quality.

 

The company constantly analyzes its ways of working and reviews the business organization in order to adapt to our changing business environment and changes in the global Ericsson organization. The strategic priority is to preserve and extend responsibilities in particular business segments and to secure new business opportunities and key deals.

 

Communications Ericsson Nikola Tesla