Nokia not ruling out further restructuring

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Differing market conditions may force further restructuring but manufacturer says it has almost achieved its cost-saving aims and will be ready to react if further changes are required          

Nokia has refused to rule out further restructuring beyond this year but said that if it were to happen, it will be ready to react.

The manufacturer was speaking to analysts following the publication of its Q4 2012 financial results, which saw the company return to profitability following months of losses.

Last June, Nokia announced a restructuring programme that would see it cut 10,000 jobs and save €1.6 billion by the end of 2013 as part of plans to streamline the business and return it to profitability.

Nokia executive vice president and chief financial officer Timo Ihamuotila told analysts the manufacturer was pleased with its continuing progress and by the end of last year it had already recognised the vast majority of the restructuring charges, having saved €1.4 billion.

Currently, Nokia’s devices and services business employs just over 33,000 people, a reduction of 16,500 employees from a year ago and down 5,000 from the previous quarter.

In December it sold its head offices in Finland (pictured) to software consultancy firm for €170 million, leasing the premises back to the company in the process. It also sold its luxury handset division Vertu in October to private equity firm EQT VI for an undisclosed sum.

Last week it announced it is to cut 300 jobs in its global IT organisation, adding these would be the last anticipated reductions as part of the restructuring plans announced last June.

However, Ihamuotila said that a further restructuring couldn’t be ruled out if the situation was to significantly change but that Nokia would be ready for it if that was to be the case.

” We see the target we have set ourselves to achieve before the end of the year as the right target for the company.

“Of course if the situation was to significantly change, either positively or negatively, we need to be able to react to that. Despite that, we are significantly down the road on the execution of the restructuring programmes we have announced so far.”

Nokia president and CEO Stephen Elop added: “We announced our last major restructuring in June and various elements of that have been kicking in recently.

“There is still some activity ongoing but in terms of the critical mass of resources we require for research and development and to drive innovation, we’re very comfortable at where we stand.”

 

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