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(Address of principal executive offices)
Telephone: +358 (0)71800-8000, Facsimile: +358 (0) 71803-8503
Keilalahdentie 4, P.O. Box 226, FI-00045 NOKIA GROUP, Espoo, Finland
(Name, Telephone,E-mail and/or Facsimile number and Address of Company Contact Person)
Name of each exchange | ||
Title of each class | on which registered | |
American Depositary Shares Shares | New York Stock Exchange New York Stock Exchange(1) |
(1) | Not for trading, but only in connection with the registration of American Depositary Shares representing these shares, pursuant to the requirements of the Securities and Exchange Commission. |
Large accelerated filer x | Accelerated filer o | Non-accelerated filer o | Smaller reporting companyo |
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• | the intention to form a strategic partnership with Microsoft to combine complementary assets and expertise to form a global mobile ecosystem and to adopt Windows Phone as our primary smartphone platform, including the expected plans and benefits of such partnership; | |
• | the timing and expected benefits of our new strategy, including expected operational and financial benefits and targets as well as changes in leadership and operational structure; | |
• | the timing of the deliveries of our products and services; | |
• | our ability to innovate, develop, execute and commercialize new technologies, products and services; | |
• | expectations regarding market developments and structural changes; | |
• | expectations and targets regarding our industry volumes, market share, prices, net sales and margins of products and services; | |
• | expectations and targets regarding our operational priorities and results of operations; | |
• | expectations and targets regarding collaboration and partnering arrangements; | |
• | the outcome of pending and threatened litigation; | |
• | expectations regarding the successful completion of acquisitions or restructurings on a timely basis and our ability to achieve the financial and operational targets set in connection with any such acquisition or restructuring; and | |
• | statements preceded by “believe,” “expect,” “anticipate,” “foresee,” “target,” “estimate,” “designed,” “plans,” “will” or similar expressions. |
1. | whether definitive agreements can be entered into with Microsoft for the proposed partnership in a timely manner, or at all, and on terms beneficial to us; | |
2. | our ability to succeed in creating a competitive smartphone platform for high-quality differentiated winning smartphones or in creating new sources of revenue through the proposed partnership with Microsoft; | |
3. | the expected timing of the planned transition to Windows Phone as our primary smartphone platform and the introduction of mobile products based on that platform; | |
4. | our ability to maintain the viability of our current Symbian smartphone platform during the transition to Windows Phone as our primary smartphone platform; | |
5. | our ability to realize a return on our investment in MeeGo and next generation devices, platforms and user experiences; | |
6. | our ability to build a competitive and profitable global ecosystem of sufficient scale, attractiveness and value to all participants and to bring winning smartphones to the market in a timely manner; | |
7. | our ability to produce mobile phones in a timely and cost efficient manner with differentiated hardware, localized services and applications; |
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8. | our ability to increase our speed of innovation, product development and execution to bring new competitive smartphones and mobile phones to the market in a timely manner; | |
9. | our ability to retain, motivate, develop and recruit appropriately skilled employees; |
10. | our ability to implement our strategies, particularly our new mobile product strategy; | |
11. | 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; | |
12. | our ability to maintain and leverage our traditional strengths in the mobile product market if we are unable to retain the loyalty of our mobile operator and distributor customers and consumers as a result of the implementation of our new strategy or other factors; | |
13. | our success in collaboration and partnering arrangements with third parties, including Microsoft; | |
14. | the success, financial condition and performance of our suppliers, collaboration partners and customers; | |
15. | 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; | |
16. | our ability to source sufficient amounts of fully functional quality components,sub-assemblies and software on a timely basis without interruption and on favorable terms; | |
17. | our ability to manage our inventory and timely adapt our supply to meet changing demands for our products; | |
18. | our ability to successfully manage costs; | |
19. | our ability to effectively and smoothly implement the new operational structure for our devices and services business effective April 1, 2011; | |
20. | the development of the mobile and fixed communications industry and general economic conditions globally and regionally; | |
21. | exchange rate fluctuations, including, in particular, fluctuations 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; | |
22. | our ability to protect the technologies, which we or others develop or that 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 products and services; | |
23. | our ability to protect numerous Nokia, NAVTEQ and Nokia Siemens Networks patented, standardized or proprietary technologies from third-party infringement or actions to invalidate the intellectual property rights of these technologies; | |
24. | the impact of changes in government policies, trade policies, laws or regulations and economic or political turmoil in countries where our assets are located and we do business; | |
25. | any disruption to information technology systems and networks that our operations rely on; | |
26. | unfavorable outcome of litigations; | |
27. | allegations of possible health risks from electromagnetic fields generated by base stations and mobile products and lawsuits related to them, regardless of merit; | |
28. | our ability to achieve targeted costs reductions and increase profitability in Nokia Siemens Networks and to effectively and timely execute related restructuring measures; |
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29. | Nokia Siemens Networks’ ability to maintain or improve its market position or respond successfully to changes in the competitive environment; | |
30. | Nokia Siemens Networks’ liquidity and its ability to meet its working capital requirements; | |
31. | whether Nokia Siemens Networks’ acquisition of the majority of Motorola’s wireless network infrastructure assets will be completed in a timely manner, or at all, and, if completed, whether Nokia Siemens Networks is able to successfully integrate the acquired business, cross-sell its existing products and services to customers of the acquired business and realize the expected synergies and benefits of the planned acquisition; | |
32. | Nokia Siemens Networks’ ability to timely introduce new products, services, upgrades and technologies; | |
33. | Nokia Siemens Networks’ success in the telecommunications infrastructure services market and Nokia Siemens Networks’ ability to effectively and profitably adapt its business and operations in a timely manner to the increasingly diverse service needs of its customers; | |
34. | developments under large, multi-year contracts or in relation to major customers in the networks infrastructure and related services business; | |
35. | the management of our customer financing exposure, particularly in the networks infrastructure and related services business; | |
36. | whether ongoing or any additional governmental investigations into alleged violations of law by some former employees of Siemens AG (“Siemens”) may involve and affect the carrier-related assets and employees transferred by Siemens to Nokia Siemens Networks; | |
37. | 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; |
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ITEM 1. | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS |
ITEM 2. | OFFER STATISTICS AND EXPECTED TIMETABLE |
ITEM 3. | KEY INFORMATION |
Year Ended December 31, | ||||||||||||||||||||||||
2006(1) | 2007(1) | 2008(1) | 2009(1) | 2010(1) | 2010(1) | |||||||||||||||||||
(EUR) | (EUR) | (EUR) | (EUR) | (EUR) | (USD) | |||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||||||
Profit and Loss Account Data | ||||||||||||||||||||||||
Net sales | 41 121 | 51 058 | 50 710 | 40 984 | 42 446 | 56 322 | ||||||||||||||||||
Operating profit | 5 488 | 7 985 | 4 966 | 1 197 | 2 070 | 2 747 | ||||||||||||||||||
Profit before tax | 5 723 | 8 268 | 4 970 | 962 | 1 786 | 2 370 | ||||||||||||||||||
Profit attributable to equity holders of the parent | 4 306 | 7 205 | 3 988 | 891 | 1 850 | 2 455 | ||||||||||||||||||
Earnings per share (for profit attributable to equity holders of the parent) | ||||||||||||||||||||||||
Basic earnings per share | 1.06 | 1.85 | 1.07 | 0.24 | 0.50 | 0.66 | ||||||||||||||||||
Diluted earnings per share | 1.05 | 1.83 | 1.05 | 0.24 | 0.50 | 0.66 | ||||||||||||||||||
Cash dividends per share | 0.43 | 0.53 | 0.40 | 0.40 | 0.40 | (2) | 0.53 | (2) | ||||||||||||||||
Average number of shares (millions of shares) | ||||||||||||||||||||||||
Basic | 4 063 | 3 885 | 3 744 | 3 705 | 3 709 | 3 709 | ||||||||||||||||||
Diluted | 4 087 | 3 932 | 3 780 | 3 721 | 3 713 | 3 713 |
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December 31, | ||||||||||||||||||||||||
2006(1) | 2007(1) | 2008(1) | 2009(1) | 2010(1) | 2010(1) | |||||||||||||||||||
(EUR) | (EUR) | (EUR) | (EUR) | (EUR) | (USD) | |||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||||||
Balance Sheet Data | ||||||||||||||||||||||||
Fixed assets and other non-current assets | 4 031 | 8 305 | 15 112 | 12 125 | 11 978 | 15 893 | ||||||||||||||||||
Cash and other liquid assets(3) | 8 537 | 11 753 | 6 820 | 8 873 | 12 275 | 16 288 | ||||||||||||||||||
Other current assets | 10 049 | 17 541 | 17 650 | 14 740 | 14 870 | 19 731 | ||||||||||||||||||
Total assets | 22 617 | 37 599 | 39 582 | 35 738 | 39 123 | 51 912 | ||||||||||||||||||
Capital and reserves attributable to equity holders of the parent | 11 968 | 14 773 | 14 208 | 13 088 | 14 384 | 19 086 | ||||||||||||||||||
Non-controlling interests | 92 | 2 565 | 2 302 | 1 661 | 1 847 | 2 451 | ||||||||||||||||||
Long-term interest-bearing liabilities | 69 | 203 | 861 | 4 432 | 4 242 | 5 628 | ||||||||||||||||||
Other long-term liabilities | 327 | 1 082 | 1 856 | 1 369 | 1 110 | 1 473 | ||||||||||||||||||
Borrowings due within one year | 180 | 887 | 3 591 | 771 | 1 037 | 1 376 | ||||||||||||||||||
Other current liabilities | 9 981 | 18 089 | 16 764 | 14 417 | 16 503 | 21 898 | ||||||||||||||||||
Total shareholders’ equity and liabilities | 22 617 | 37 599 | 39 582 | 35 738 | 39 123 | 51 912 | ||||||||||||||||||
Net interest-bearing debt(4) | (8 288 | ) | (10 663 | ) | (2 368 | ) | (3 670 | ) | (6 996 | ) | (9 283 | ) | ||||||||||||
Share capital | 246 | 246 | 246 | 246 | 246 | 326 |
(1) | As from April 1, 2007, our consolidated financial data includes that of Nokia Siemens Networks on a fully consolidated basis. Nokia Siemens Networks, a company jointly owned by Nokia and Siemens, is comprised of our former Networks business group and Siemens’ carrier-related operations for fixed and mobile networks. Accordingly, our consolidated financial data for the year ended December 31, 2006 is not directly comparable to any subsequent years and our consolidated financial data for the year ended December 31, 2007 is not directly comparable to any prior or subsequent years. Our consolidated financial data for the periods prior to April 1, 2007 included our former Networks business group only. | |
(2) | The cash dividend for 2010 is what the Board of Directors will propose for shareholders’ approval at the Annual General Meeting convening on May 3, 2011. | |
(3) | For the years ended December 31, 2009 and 2010, cash and other liquid assets consist of the following captions from our consolidated balance sheets: (1) bank and cash,(2) available-for-sale investments, cash equivalents,(3) available-for-sale investments, liquid assets and (4) investments at fair value through profit and loss, liquid assets. For the previous years, cash and other liquid assets consist of the following captions from our consolidated balance sheets: (1) bank and cash,(2) available-for-sale investments, cash equivalents, and(3) available-for-sale investments, liquid assets. | |
(4) | Net interest-bearing debt consists of borrowings due within one year and long-term interest-bearing liabilities, less cash and other liquid assets. |
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EUR millions | ||||||||
Number of shares | (in total) | |||||||
2006 | 212 340 000 | 3 412 | ||||||
2007 | 180 590 000 | 3 884 | ||||||
2008 | 157 390 000 | 3 123 | ||||||
2009 | — | — | ||||||
2010 | — | — |
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EUR millions | ||||||||||||
EUR per share | USD per ADS | (in total) | ||||||||||
2006 | 0.43 | 0.58 | 1 685 | |||||||||
2007 | 0.53 | 0.83 | 1 992 | |||||||||
2008 | 0.40 | 0.54 | 1 481 | |||||||||
2009 | 0.40 | 0.49 | 1 483 | |||||||||
2010 | 0.40 | (1) | — | (2) | 1 498 | (3) |
(1) | The proposal of the Board of Directors for shareholders’ approval at the Annual General Meeting convening on May 3, 2011. | |
(2) | The final US dollar amount will be determined on the basis of the decision of the Annual General Meeting and the dividend payment date. | |
(3) | Maximum amount to be distributed as dividend based on the number of shares at December 31, 2010. Earlier year figure represents the total actual amount paid. |
Exchange Rates | ||||||||||||||||
Rate at | Average | Highest | Lowest | |||||||||||||
For the year ended December 31: | period end | rate | rate | rate | ||||||||||||
(USD per EUR) | ||||||||||||||||
2006 | 1.3197 | 1.2661 | 1.3327 | 1.1860 | ||||||||||||
2007 | 1.4603 | 1.3797 | 1.4862 | 1.2904 | ||||||||||||
2008 | 1.3919 | 1.4695 | 1.6010 | 1.2446 | ||||||||||||
2009 | 1.4332 | 1.3955 | 1.5100 | 1.2547 | ||||||||||||
2010 | 1.3269 | 1.3216 | 1.4536 | 1.1959 | ||||||||||||
For the month ended: | ||||||||||||||||
September 30, 2010 | 1.3601 | 1.3103 | 1.3638 | 1.2708 | ||||||||||||
October 31, 2010 | 1.3894 | 1.3900 | 1.4066 | 1.3688 | ||||||||||||
November 30, 2010 | 1.3036 | 1.3654 | 1.4224 | 1.3036 | ||||||||||||
December 31, 2010 | 1.3269 | 1.3221 | 1.3395 | 1.3089 | ||||||||||||
January 31, 2011 | 1.3715 | 1.3371 | 1.3715 | 1.2944 | ||||||||||||
February 28, 2011 | 1.3793 | 1.3656 | 1.3794 | 1.3474 |
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• | Definitive agreements with Microsoft for the proposed partnership may not be entered into in a timely manner, or at all, or on terms beneficial to us. | |
• | In choosing to adopt Windows Phone as our primary smartphone platform, we may forgo more competitive alternatives achieving greater and faster acceptance in the smartphone market. If we fail to finalize our partnership with Microsoft or the benefits of that partnership do not materialize as expected, we will have limited our options and more competitive alternatives may not be available to us in a timely manner, or at all. | |
• | The Windows Phone platform is a very recent, largely unproven addition to the market focused solely on high-end smartphones with currently very low adoption and consumer awareness relative to the Android and Apple platforms, and the proposed Microsoft partnership may not succeed in developing it into a sufficiently broad competitive smartphone platform. | |
• | Our expected transition to the Windows Phone platform may prove to be too long to compete effectively in the smartphone market longer term given the ongoing developments of other competing smartphone platforms. | |
• | Our ability to innovate and customize on the Windows Phone platform may not materialize as expected to enable us to produce smartphones that are differentiated from those of our competitors. | |
• | The Microsoft partnership may not achieve in a timely manner the necessary scale, product breadth, geographical reach and localization to be sufficiently competitive in the smartphone market. | |
• | The Microsoft partnership may erode our brand identity in markets where we are strong and may not enhance our brand identity in markets where we are weak. For example, our association with the Microsoft brand may impair our current strong market position in China and may not accelerate our access to a broader market in the United States. | |
• | New sources of revenue expected to be generated from the Microsoft partnership, such as |
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increased monetization opportunities for us in services and intellectual property rights, may not materialize as expected, or at all. |
• | The opportunity to integrate our location-based assets, including NAVTEQ, with Microsoft’s Bing search engine and adCenter advertising platform and leverage those combined assets to form a local search and advertising capability that generates new sources of revenue for us may not materialize as expected, or at all. This could also decrease the value of our location-based assets that might result in impairment charges. | |
• | We may not succeed in leveraging the Microsoft advertising assets to build and achieve the required scale for a Nokia-based online advertising platform on our smartphones that generates new sources of advertising-based revenue. | |
• | We may not succeed in creating a profitable business model when we transition from our royalty-free smartphone platform to the royalty-based Windows Phone platform due to, among other things, our inability to offset our higher cost of sales resulting from our royalty payments to Microsoft with new revenue sources and a reduction of our operating expenses, particularly our research and development expenses. | |
• | We will need to continue to innovate and find additional ways to create patentable inventions and other intellectual property, particularly as we would no longer be developing the core platform technology for our smartphones under the proposed Microsoft partnership. As a result, we may not be able to generate sufficient patentable inventions or other intellectual property to maintain, for example, the same sizeand/or quality patent portfolio as we have historically. | |
• | We may not be able to change our mode of working or culture to enable us to work effectively and efficiently with Microsoft in order to realize the stated benefits of the proposed partnership in a timely manner. | |
• | The negotiation and implementation of the proposed Microsoft partnership will require significant time, attention and resources of our senior management and others within the organization potentially diverting their attention from other aspects of our business. | |
• | The proposed Microsoft partnership may cause dissatisfaction and adversely affect the terms on which we do business with our other partners, mobile operators, distributors and suppliers, or foreclose the ability to do business with new partners, mobile operators, distributors and suppliers. | |
• | The implementation of the proposed Microsoft partnership may cause disruption and dissatisfaction among employees reducing their motivation, energy, focus and productivity, causing inefficiencies and other problems across the organization and leading to the loss of key personnel and the related costs in dealing with such matters. | |
• | We may not have or be able to recruit, retain and motivate appropriately skilled employees to implement successfully the Windows Phone smartphone platform and to work effectively and efficiently with Microsoft and the related ecosystem. | |
• | We may be required or choose to share with Microsoft personal or consumer data that has been made available to us, which could increase the risk of loss, improper disclosure or leakage of such personal or consumer data or create negative perceptions about our ability to maintain the confidentiality of such data. | |
• | Consumers may be more reluctant to provide personal data to us as a result of the proposed Microsoft partnership, which would hamper our ability to use our current business models, or create new ones, that rely on access to personal data. | |
• | We do not currently have tablets in our mobile product portfolio, which may result in our inability to compete effectively in that market segment in the future or forgoing that potential growth opportunity in the mobile market. |
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• | The assessment of our proposed partnership with Microsoft and new strategy could cause lowered credit ratings of our short and long-term debt or their outlook from the credit rating agencies and, consequently, impair our ability to raise new financing or refinance our current borrowings and increase our interest costs associated with any new debt instruments. |
• | Our mobile operator and distributor customers and consumers may no longer see our Symbian smartphones as attractive investments during the transition to Windows Phone. This would result in a loss of market share, which could be substantial, during the transition and which we may not be able to regain when quantities of Nokia Windows Phone smartphones are commercially available. | |
• | We may not succeed in transitioning over time our installed base of Symbian owners to our Windows Phone smartphones. | |
• | Application, services and content development by developers and other partners for Symbian may decline or cease, which would diminish the viability of our Symbian smartphones and their attractiveness to our mobile operator and distributor customers and consumers, as well as limit the opportunity to transition compatible aspects of our Symbian development to the Windows Phone ecosystem. | |
• | Our mobile operator and distributor customers may choose not to promote and market robustly some or all of our Symbian smartphones, may require monetary incentives, including significant price reductions, to do so or may discontinue some or all of our Symbian smartphone product lines. | |
• | Our suppliers may reduce the availability of certain components for our Symbian smartphones or we may not be able to obtain certain or sufficient components for our Symbian smartphones at attractive prices resulting in increased costs that we may not be able to pass on to our customers. | |
• | We may not be able to provide the necessary support for our Symbian smartphones organization and business during the transition to Windows Phone, including efficiently managing the phase-out over time of our investment in Symbian while maintaining acceptable profitability for those products. | |
• | We may lose key personnel and skilled employees involved in the development of our Symbian platform. We may also not be able to maintain employee motivation and focus to continue to innovate and develop on the Symbian smartphone platform or otherwise be able to maintain the quality of our Symbian smartphones. | |
• | Under our new strategy, MeeGo becomes an open-source, mobile platform project. Our investment in MeeGo will emphasize longer-term market exploration of next-generation devices, platforms and user experiences. We plan to ship a MeeGo-based mobile product later this year. If the market segment that we target with that mobile product does not materialize as expected, or if we fail to develop next-generation platforms, user experiences and mobile products, we may incur operating losses and accordingly not realize a return on our investment in this area. |
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• | If we fail to finalize a partnership with Microsoft or the benefits of that partnership do not materialize as expected, we will have limited our options to build a competitive smartphone ecosystem with another partner or join another competitive smartphone ecosystem in a timely manner. | |
• | The Windows Phone platform may not achieve or retain broad or timely market acceptance or be preferred by ecosystem participants, mobile operators and consumers. | |
• | We may not be able to develop and execute with speed sufficient quantities of high-quality differentiated Nokia Windows Phone smartphones in order to achieve the scale needed for a competitive global ecosystem and the success of our own business and results of operations. | |
• | We may not be able to provide sufficient opportunities to innovate and customize on the Windows Phone platform in order to attract developers and other ecosystem participants seeking to differentiate their offerings on our smartphones from those of our competitors. | |
• | We may not succeed in rapidly expanding the Windows Phone platform and related ecosystem beyond its current use in high-end smartphones to more affordable smartphones. | |
• | Other competitive major smartphone ecosystems have advantages which may be difficult for us to overcome, such as first-mover advantage, momentum, engagement by developers, mobile operators and consumers and brand preference, and their advantages may become even greater during our transition to the Windows Phone platform. | |
• | The global ecosystem may not be flexible enough to allow local ecosystems to develop around and in connection with it. | |
• | Applicable developer tools may not gain needed traction or acceptance in the market, may be |
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introduced late, or when introduced, do not offer technologies that developers are willing to use. |
• | We may not succeed in creating business models which provide value to all participants in the ecosystem, including ourselves. | |
• | We may not succeed in reducing our smartphone operating expenses, including our research and development costs, which will impair our ability to create a profitable business model for a new global ecosystem. | |
• | We may not be able to change our mode of working or culture sufficiently to collaborate effectively and efficiently both internally and externally with a large community of partners. | |
• | We may not succeed in making the Nokia brand more desirable than brands of our competitors in smartphones. | |
• | We may not be able to attract developers and other participants to our ecosystem if they do not have the opportunity to leverage their offerings across a wide range of mobile products, particularly tablets, which we currently do not have in our mobile product portfolio. |
• | We may not be able to leverage our traditional competitive strengths of scale in manufacturing and logistics, as well as in our marketing and sales channels, to significantly increase the speed to market of our mobile phones in a sufficiently cost-competitive manner, particularly with mobile operators and consumers requiring increasing customization to meet divergent local needs and preferences. | |
• | We may be unable to source the right amount of components and at affordable cost. | |
• | The platforms that we deploy for our mobile phones may not provide sufficient flexibility and cost efficiency for application developers and other partners to create a vibrant ecosystem for mobile phones with increasingly smartphone-like experiences of Internet access and mobile applications. | |
• | We may need to make significant investments to further develop our mobile phone platforms in order to bring an upgraded mobile experience to traditional mobile phone consumers. | |
• | We may not succeed in innovating and developing sufficiently locally relevant services, applications and content in a speedy and cost-efficient manner to attract and retain consumers in multiple markets with divergent local needs and preferences. | |
• | Our brand preference may erode due to various factors, such as inadequate marketing, quality issues, lack of affordable locally-relevant services, applications and content or lack of success in smartphones. | |
• | Our management attention in smartphones and in the establishment of the new ecosystem for |
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smartphones with Microsoft may result in less management attention paid to our mobile phones business. |
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• | We fail to engage the right partners or on terms that are beneficial to us. | |
• | We are unable to collaborate and partner effectively with individual partners and simultaneously with multiple partners to execute and reach the targets set for the collaboration. | |
• | The arrangements with the parties we work with do not develop as expected. | |
• | The technologies provided by the parties we work with are not sufficiently protected or infringe third parties’ intellectual property rights in a way that we cannot foresee or prevent. | |
• | The technologies or products or services supplied by the parties we work with do not meet the required quality, safety, security and other standards or customer needs. | |
• | Our own quality controls fail. | |
• | The financial condition of our collaborative partners deteriorates which may result in underperformance by the collaborative partners or insolvency or closure of the business of such partners. | |
• | Our increasing reliance on collaborative partnering for Nokia-branded or co-branded products |
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may result in more variable quality due to our more limited control which may have a negative effect on our reputation and erode the value of the Nokia brand. |
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• | Limit the availability of credit or raise the interest rates related to credit which may have a negative impact on the financial condition, and in particular on the purchasing ability, of some of our distributors, independent retailers and network operator customers and may also result in requests for extended payment terms, credit losses, insolvencies, limited ability to respond to demand or diminished sales channels available to us. | |
• | Cause financial difficulties for our suppliers and collaborative partners which may result in their failure to perform as planned and, consequently, in delays in the delivery of our products. | |
• | Increase volatility in exchange rates which may increase the costs of our products that we may not be able to pass on to our customers and result in significant competitive benefit to certain of our competitors that incur a material part of their costs in other currencies than we do; hamper our pricing; and increase our hedging costs and limit our ability to hedge our exchange rate exposure. | |
• | Result in inefficiencies due to our deteriorated ability to appropriately forecast developments in our industry and plan our operations accordingly, delayed or insufficient investments in new market segments and failure to adjust our costs appropriately. | |
• | Cause reductions in the future valuations of our investments and assets and result in impairment charges related to goodwill or other assets due to any significant underperformance relative to historical or projected future results by us or any part of our |
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business or any significant changes in the manner of our use of acquired assets or the strategy for our overall business. |
• | Cause lowered credit ratings of our short and long-term debt or their outlook from the credit rating agencies and, consequently, impair our ability to raise new financing or refinance our current borrowings and increase our interest costs associated with any new debt instruments. | |
• | Result in failures of derivative counterparties or other financial institutions which could have a negative impact on our treasury operations. | |
• | Result in increasedand/or more volatile taxes which could negatively impact our effective tax rate. | |
• | Impact our investment portfolio and other assets and result in impairment. |
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• | The acquisition does not receive all regulatory approvals or fulfil closing conditions and does not close in a timely manner, or at all. | |
• | The financial data on which the decision to undertake the acquisition was based on is materially inaccurate | |
• | The difficulty in integrating the acquired business in an efficient and effective manner. | |
• | The challenges in achieving the strategic objectives, cost savings and other benefits from the acquisition. | |
• | Existing customers of the acquired business may be reluctant, unwilling or unable to maintain their customer relationship with Nokia Siemens Networks after the acquisition. | |
• | The markets of the acquired business do not evolve as anticipated and the technologies acquired do not prove to be those needed to be successful in those markets. | |
• | Nokia Siemens Networks may not successfully access the acquired business’ existing product markets due to a lack of requisite capabilities, regulatory reasons or otherwise. | |
• | The potential loss of key employees of the acquired business. | |
• | The risk of diverting the attention of senior management from Nokia Siemens Networks’ operations. | |
• | The risks associated with integrating financial reporting and internal control systems. | |
• | Difficulties in expanding information technology systems and other business processes to accommodate the acquired business. | |
• | Impairments of goodwill could arise as a result of the acquisition. | |
• | Unexpected contingent or undisclosed liabilities may be acquired with the acquired business and agreed indemnities may provide insufficient coverage against such liabilities. | |
• | If Nokia Siemens Networks does not successfully cross-sell its existing products and services to customers of the acquired business, Nokia Siemens Networks may not realize the expected expansion of its customer base. |
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ITEM 4. | INFORMATION ON THE COMPANY |
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• | In 1967, we took our current form as Nokia Corporation under the laws of the Republic of Finland. This was the result of the merger of three Finnish companies: Nokia AB, a wood-pulp mill founded in 1865; Finnish Rubber Works Ltd, a manufacturer of rubber boots, tires and other rubber products founded in 1898; and Finnish Cable Works Ltd, a manufacturer of telephone and power cables founded in 1912. | |
• | We entered the telecommunications equipment market in 1960 when an electronics department was established at Finnish Cable Works to concentrate on the production of radio-transmission equipment. | |
• | Regulatory and technological reforms have played a role in our success. Deregulation of the European telecommunications industries since the late 1980s stimulated competition and boosted customer demand. | |
• | In 1982, we introduced the first fully-digital local telephone exchange in Europe, and in that same year we introduced the world’s first car phone for the Nordic Mobile Telephone analog standard. | |
• | The technological breakthrough of GSM, which made more efficient use of frequencies and had greater capacity in addition to high-quality sound, was followed by the European resolution in 1987 to adopt GSM as the European digital standard by July 1, 1991. | |
• | The first GSM call was made with a Nokia phone over the Nokia-built network of a Finnish operator called Radiolinja in 1991, and in the same year Nokia won contracts to supply GSM networks in other European countries. | |
• | In the early 1990s, we made a strategic decision to make telecommunications our core business, with the goal of establishing leadership in every major global market. Basic industry and non-telecommunications operations—including paper, personal computer, rubber, footwear, chemicals, power plant, cable, aluminum and television businesses—were divested during the period from 1989 to 1996. | |
• | Mobile communications evolved rapidly during the 1990s and early 2000s, creating new opportunities for devices in entertainment and enterprise use. This trend—where mobile devices increasingly support the features of single-purposed product categories such as music players, cameras, pocketable computers and gaming consoles—is often referred to as digital convergence. | |
• | Nokia Siemens Networks began operations on April 1, 2007. The company, jointly owned by Nokia and Siemens AG and consolidated by Nokia, combined Nokia’s networks business and Siemens’ carrier-related operations for fixed and mobile networks. | |
• | In recent years, we have supported the development of our services and software capabilities with acquisitions of key technologies, content and expertise. For example, in 2008 we acquired NAVTEQ, |
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a leading provider of comprehensive digital map information and related location-based content and services, as well as Trolltech, whose Qt technology forms the basis of the tools we and third party developers use to develop services and applications for Nokia smartphones. In 2010, we acquired Motally, whose mobile analytics service enables developers and publishers to optimize the development of their mobile applications through increased understanding of how users engage; MetaCarta to obtain its geographic intelligence technology and expertise; and Novarra, whose mobile browser and services platform is being used by Nokia to deliver enhanced Internet experiences on Nokia’sSeries 40-based mobile phones. |
• | We are also partnering with third parties as we seek to create the best user experiences for our customers. For instance, in 2010, we formed an alliance with Yahoo!, whereby Nokia is the exclusive, global provider of Yahoo!’s maps and navigation services, integrating Ovi Maps across Yahoo! properties, and Yahoo! is the exclusive, global provider of Nokia’s Ovi Mail and Ovi Chat services. | |
• | In 2010, Nokia Siemens Networks announced that it had entered into an agreement to acquire the majority of the wireless network infrastructure assets of Motorola. The planned acquisition is expected to enhance Nokia Siemens Networks’ capabilities in key wireless technologies, including WiMAX and CDMA, and strengthen its market position in key geographic markets, in particular Japan and the United States. Nokia Siemens Networks is also targeting to gain incumbent relationships with more than 50 operators and strengthen relationships with certain of the largest communication service providers globally as a result of the acquisition. The Motorola acquisition is expected to close after the final antitrust approval by the Chinese regulatory authorities has been granted and the other closing conditions have been met. | |
• | As part of our efforts to concentrate on services that we have identified as core to Nokia’s offering, we have also made disposals, including, most recently, the sale of our wireless modem business to Renesas Electronics Corporation as part of a strategic business alliance between the two companies to develop modem technologies for HSPA+/LTE (Evolved High-Speed Packet Access / Long-Term Evolution) and its evolution. | |
• | In February 2011, Nokia announced a new strategy, leadership team and operational structure designed to accelerate our speed of execution in the intensely competitive mobile products market. The main elements of the new strategy include: plans for a broad strategic partnership with Microsoft to build a new global mobile ecosystem, with Windows Phone serving as Nokia’s primary smartphone platform; a renewed approach to capture volume and value growth to connect “the next billion” to the Internet in developing growth markets; focused investments in next-generation disruptive technologies; and a new leadership team and operational structure designed to focus on speed, accountability and results. |
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• | Mapsgives consumers access to world-class mapping and navigation. Maps utilizes NAVTEQ’s digital maps database and has been evolving from a static map to a dynamic platform upon which users can add their own content and access location-based services as well as content placed on the map by third parties, such as Lonely Planet, Michelin, HRS and TripAdvisor. Our smartphones include high-end drive and walk navigation features such asturn-by-turn voice guidance, at no extra cost for consumers in 100 markets. Additionally, more than 100 cities around the world have dedicated pedestrian navigation. With the release of the latest version of Ovi Maps, users can download maps directly to their device over Wi-Fi as well as enjoy mapping that includes public transport lines for subways, trams and trains in more than |
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80 cities around the world. In 2010, as part of the newly-formed strategic alliance with Yahoo!, Nokia became the exclusive global provider of Yahoo!’s maps and navigation services, integrating Ovi Maps across Yahoo! properties, branded as “powered by Ovi.” |
• | Storeis a place where people can download thousands of popular applications and games, many of which are localized for a wide variety of geographies and cultures. During 2010, Nokia launched a renewed Store, offering an improved consumer user experience, including a redesigned look and feel and faster performance as well as enhancements to the way content is displayed and discovered. As of March 2011, the Store was attracting more than 4 million downloads a day. This compares with around 1.5 million downloads a day in March 2010. | |
• | Musicoffers a catalog of more than 11 million music tracks, including lots of music from local artists. During 2010, Nokia migrated its Nokia Music Store digital music service to the new Ovi Music platform, which is designed to deliver an enhanced mobile and personal computer (PC) music download experience for new and existing users. The Ovi Music platform brings DRM-free music, improved search, a more attractive user interface, common Ovi branding and numerous user experience enhancements, includingover-the-air one-click album downloads. Ovi Music is available in 38 markets. As part of Nokia’s ongoing strategy to deliver market-leading, locally relevant experiences, the decision was made to discontinue production of Ovi Music-unlimited edition devices—with the exception of some high growth markets—as of December 31, 2010. However, in all markets we will continue to offer the full service to existing and new users until the end of their current subscription. | |
• | Mailis a free email service designed especially for users in emerging markets with Internet-enabled devices. The service can be set up and accessed without ever needing a PC. In 2010, as part of our strategic alliance, Yahoo! became the exclusive global provider of Nokia’s Ovi Mail as well as our Ovi Chat instant messaging service branded as “Ovi Mail / Ovi Chat powered by Yahoo!”. | |
• | Life Toolsis a subscription service through which people can access timely and relevant agricultural information, as well as education, healthcare and entertainment services, without requiring the use of GPRS or Internet connectivity. We currently offer Life Tools across China, India, Indonesia and Nigeria and to date, almost 9 million people have experienced the service. In Nigeria, where Nokia launched the service in November 2010, a farmer can, for example, use the text-based service to check crop prices at markets nearby to find the best market for his product without incurring the time and money that would have otherwise been spent travelling to markets to check prices. Life Tools is available on select Nokia mobile phones, including the Nokia 1616, our popularSeries 30-based model. |
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• | Sensing and Data Intelligence: Interactions between people and their surroundings, location, and social environment provide the basis for new classes of services in areas such as traffic, health and entertainment, enabling new business models to emerge. | |
• | New User Interface: Future user interfaces will utilize intelligence and context-awareness to enhance user experiences, integrating the personalized and adaptive aspects of devices with data-sharing capabilities. | |
• | High Performance Mobile Platforms: Research focuses on improving theperformance-to-power ratio, delivering new sensing capabilities as well as extending platform architecture to enable interoperability and facilitate application development. | |
• | Cognitive Radio: Research in this area examines ways to utilize wireless spectrum dynamically to improve connectivity and capacity and enable large-scale sensing. |
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• | NAVTEQ launched its new advanced mapping collection technology, NAVTEQ True, further innovating the scale and quality of data collection and processing. | |
• | NAVTEQ launched Natural Guidance, a product to enable guidance in a human manner through the use of descriptive reference cues. | |
• | NAVTEQ announced successful advertiser trials in Europe with McDonald’s and Best Western powered by NAVTEQ’s LocationPoint Advertising platform. | |
• | NAVTEQ expanded map coverage to include six more countries, bringing to 84 the number of countries supported by NAVTEQ Maps. | |
• | NAVTEQ announced the availability of real-time traffic in the UK, bringing to 13 the number of European cities with access to uninterrupted traffic data. |
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• | Advanced Driver Assistance Systemsare in-vehicle applications that require highly accurate and comprehensive geographic data, such as curve, slope, speed limits and highly detailed geometry, to enhance various fuel efficiency, safety feature and driver advisory systems. | |
• | Dynamic navigationis real-time, detailedturn-by-turn route guidance which can be provided to end-users through vehicle navigation systems, as well as through GPS-enabled handheld navigation devices, and other mobile devices. | |
• | Route planningconsists of driving directions, route optimization and map display through services provided by Internet portals and through computer software for personal and commercial use. | |
• | Location-based servicesinclude location-specific information services, providing information about people and places that is tailored to the immediate proximity of the specific user. Current applications using NAVTEQ’s map database include points of interest locators, mobile directory assistance services, emergency response systems and vehicle-based telematics services. | |
• | Geographic information systemsrender geographic representations of information and assets for management analysis and decision making. Examples of these applications include infrastructure cataloging and tracking for government agencies and utility companies, asset tracking and fleet management for commercial logistics companies and demographic analysis. |
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• | Managed Servicesoffers network planning and optimization and the management of network operations, with the leading market share position in India, Latin America and the Middle East and Africa. | |
• | Careoffers software and hardware maintenance, proactive and multi-vendor care and competence development services, dealing with one million global hardware service transactions per year. | |
• | Network Implementationoffers project management and turnkey implementations and energy efficient sites, remotely activating a site every two minutes, 365 days per year. |
• | Business Support Systemsincludes products for convergent charging and billing, mediation and service brokering. It enables communication service providers to monetize services through flexible and personalized pricing models, bundles and payment methods, and to leverage existing network assets and new-IP capabilities to deliver next-generation services and accelerate time to market. | |
• | Operations Support Systemsincludes products for network, service, resource and inventory management and process automation. It enables communication service providers to automate customer-centric processes, manage multivendor networks and services, enhance network and service performance and personalize service quality. |
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• | Customer Experience Managementincludes products for subscriber data management, customer care automation, device management, reporting and analytics. It enables communication service providers to consolidate and leverage subscriber, network, device and service data in order to proactively enhance the customer experience in real-time. | |
• | Service Enablement and Deliveryincludes products for mobile browsing, messaging, multiscreen TV and rich communication. It enables communication service providers to develop, launch and monetize innovative services across multiple networks and devices, shortentime-to-market, leverage third party partners and enhance the end-user experience. | |
• | Converged Service Controlincludes products for mobile softswitching, IMS, VoIP/VoLTE/HD Voice, next generation IN, network security and policy control. It enables communication service providers to drive an all-IP fixed and mobile voice evolution, while leveraging fixed-mobile convergence, greater efficiencies and personalized policies. |
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• | Our five-year partnership with UNESCO, initiated in October 2010. The partnership aims to harness mobile communication to serve individuals and support governments as they strive to achieve the goals of the World Declaration of Education for All. The target date for these objectives to be reached is 2015 and our partnership with UNESCO has been structured accordingly. Nokia is contributing expertise relating to technology and policy setting in this area. | |
• | Nokia Education Delivery, software which enables the structured delivery of quality education materials over mobile networks. Combined with teacher training and community engagement, this software has been shown to improve academic results and increase retention among students, especially girls. During 2010, the concept expanded to two additional countries, Chile and Colombia. This built on earlier projects in the Philippines and Tanzania. | |
• | A South African project for individualized mobile learning, which reached a stage of maturity and success in 2010. The concept uses Mxit, a popular social media channel as a means to deliver mathematics education. Importantly, it harnesses the social networking element of the channel to engage students around learning content. The project covers 30 schools and more than 4 000 students across South Africa, and helps teachers and learners deliver a marked improvement in academic achievement. |
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• | Minimizing its environmental footprint. | |
• | Combining environmental and business benefits for a sustainable solution. | |
• | Maximizing the positive impact of telecommunications on other industries. |
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Nokia | Nokia | |||||||||
Country of | Ownership | Voting | ||||||||
Company | Incorporation | Interest | Interest | |||||||
Nokia Inc. | United States | 100 | % | 100 | % | |||||
Nokia GmbH | Germany | 100 | % | 100 | % | |||||
Nokia UK Limited | England & Wales | 100 | % | 100 | % | |||||
Nokia TMC Limited | South Korea | 100 | % | 100 | % | |||||
Nokia Telecommunications Ltd. | China | 83.9 | % | 83.9 | % | |||||
Nokia Finance International B.V. | The Netherlands | 100 | % | 100 | % | |||||
Nokia Komárom Kft | Hungary | 100 | % | 100 | % | |||||
Nokia India Pvt. Ltd. | India | 100 | % | 100 | % | |||||
Nokia Italia S.p.A | Italy | 100 | % | 100 | % | |||||
Nokia Spain S.A.U. | Spain | 100 | % | 100 | % | |||||
Nokia Romania SRL | Romania | 100 | % | 100 | % | |||||
Nokia do Brasil Tecnologia Ltda | Brazil | 100 | % | 100 | % | |||||
OOO Nokia | Russia | 100 | % | 100 | % | |||||
NAVTEQ Corporation | United States | 100 | % | 100 | % | |||||
Nokia Siemens Networks B.V. | The Netherlands | 50 | %(1) | 50 | %(1) | |||||
Nokia Siemens Networks Oy | Finland | 50 | % | 50 | % | |||||
Nokia Siemens Networks GmbH & Co KG | Germany | 50 | % | 50 | % | |||||
Nokia Siemens Networks Pvt. Ltd. | India | 50 | % | 50 | % |
(1) | Nokia Siemens Networks B.V., the ultimate parent of the Nokia Siemens Networks group, is owned approximately 50% by each of Nokia and Siemens and consolidated by Nokia. Nokia effectively controls Nokia Siemens Networks as it has the ability to appoint key officers and the majority of the members of its Board of Directors and, accordingly, Nokia consolidates Nokia Siemens Networks. |
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Productive | ||||||
Capacity, Net | ||||||
Country | Location and Products | (m2)(1) | ||||
BRAZIL | Manaus: mobile devices | 11 752 | ||||
CHINA | Beijing: mobile devices | 26 848 | ||||
Dongguan: mobile devices | 35 667 | �� | ||||
Beijing: switching systems | 6 749 | |||||
Shanghai: base stations, broadband access systems, transmission systems | 16 363 | |||||
Suzhou: base stations | 11 373 | |||||
FINLAND | Salo: mobile devices | 17 352 | ||||
Oulu: base stations | 14 000 | |||||
GERMANY | Berlin: optical transmission systems | 14 045 | ||||
Bruchsal: Switching systems, transmission systems, broadband access systems | 23 612 | |||||
HUNGARY | Komárom: mobile devices | 44 805 | ||||
INDIA | Chennai: mobile devices | 35 581 | ||||
Chennai: base stations and radio controllers, microwave radio products. | 7 328 | |||||
Kolkata: fixed switching | 9 057 | |||||
MEXICO | Reynosa: mobile devices | 19 535 | ||||
REPUBLIC OF KOREA | Masan: mobile devices | 31 183 | ||||
ROMANIA | Cluj: mobile devices | 15 773 | ||||
UNITED KINGDOM | Fleet: mobile devices | 2 728 |
(1) | Productive capacity equals the total area allotted to manufacturing and to the storage of manufacturing-related materials. |
ITEM 4A. | UNRESOLVED STAFF COMMENTS |
ITEM 5. | OPERATING AND FINANCIAL REVIEW AND PROSPECTS |
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• | Devices & Services net sales to grow faster than the market, and | |
• | Devices & Services operating margin to be 10% or more, excluding special items and purchase price accounting related items. |
• | Continued convergence of the mobility, computing, consumer electronics and services industries; | |
• | Increasing importance of competing on an ecosystem to ecosystem basis with new monetization models; | |
• | Increasing challenges of achieving sustained differentiation and impact on overall industry gross margin trends; |
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• | Speed of innovation, product development and execution; | |
• | Increasing innovation in the mobile phone market; and | |
• | Operational efficiency and cost control. |
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• | Unique experiences. We believe that we have an opportunity to differentiate through a collection of experiences on Nokia devices, supported by our productization capabilities. For example, bringing together ourbest-in-class photographic and imaging capabilities with our location-based, geopositioning and other assets to create unique and differentiated experiences. | |
• | Distinctive design. We have a long history of bringing iconic and signature designs to both smart devices and mobile phones. We believe that having a distinctive “Nokia” design is a key element of our strategy. | |
• | Local and global approach. Although we are a global company, we have significant local presence and capabilities to ensure we are able to capitalize on local developer and ecosystem opportunities. Services such as Nokia Life Tools and Nokia Money as well as our ability to launch regional and country specific initiatives give us a unique opportunity to differentiate in a number of high growth markets where our market position and brand are strongest. We believe our ability to combine our scale and localization provides an important opportunity to differentiate our mobile products. | |
• | Compelling hardware. We believe that in areas such as imaging, advanced sensors, GPS, accelerometers and gyroscopes, we have an opportunity to continue to differentiate our offering across a broad range of price points. | |
• | Brand. As the devices business is a consumer business, brand is a major differentiating factor with broad effects on market position and pricing. The Interbrand annual rating of 2010 Best Global Brands positioned Nokia as the eighth most-valued brand in the world. In addition, Nokia has been ranked No. 1 in The Economic Times-Brand Equity’s annual ‘Most Trusted |
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Brands’ survey for 2010 in India, marking Nokia’s recognition as India’s most trusted brand for three consecutive years. |
• | Supply chain, distribution and relationships. We enjoy a world-class manufacturing and logistics system, which is designed to deliver quality hardware and respond quickly to customer demand. During 2010, we made over one million devices per day in our nine main device manufacturing facilities globally. In addition, we source components from a global network of strategic partners, the majority of whom we have long standing and deep relationships supported by our scale and market position. Nokia has the industry’s largest distribution network with over 650 000 points of sale globally. Compared to our competitors, we have a substantially larger distribution and care network, particularly in China, India and Middle East and Africa. | |
• | Intellectual property: Success in our industry requires significant research and development investments, with intellectual property rights filed to protect those investments and related inventions. We believe that Nokia has built one of the strongest and broadest patent portfolios in the industry. Since the early 1990s, we have invested approximately EUR 43 billion cumulatively in research and development, and we now own over 10 000 patent families. |
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• | significant underperformance relative to historical or projected future results; | |
• | significant changes in the manner of our use of these assets or the strategy for our overall business; and | |
• | significantly negative industry or economic trends. |
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Cash-generating Unit | ||||||||||||||||||||||||||||||||||||
Devices & | Nokia Siemens | |||||||||||||||||||||||||||||||||||
Services | Networks | NAVTEQ | ||||||||||||||||||||||||||||||||||
% | % | % | ||||||||||||||||||||||||||||||||||
2010 | 2009 | 2008 | 2010 | 2009 | 2008 | 2010 | 2009 | 2008 | ||||||||||||||||||||||||||||
Terminal growth rate | 2.0 | 2.0 | 2.3 | — | 1.0 | 1.0 | 4.0 | 5.0 | 5.0 | |||||||||||||||||||||||||||
Pre-tax discount rate | 11.1 | 11.5 | 12.4 | — | 13.2 | 15.6 | 12.8 | 12.6 | 12.4 |
(1) | The annual goodwill impairment testing conducted for each of the Group’s CGUs for the years ended December 31, 2010 and 2008 have not resulted in any impairment charges. The goodwill impairment testing for the year ended December 31, 2009 resulted in the aforementioned impairment charge for the Nokia Siemens Networks CGU. |
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Year Ended | Year Ended | Percentage | ||||||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||||||
2010 | Net Sales | 2009 | Net Sales | (Decrease) | ||||||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||||||
Net sales | 42 446 | 100.0 | % | 40 984 | 100.0 | % | 4 | % | ||||||||||||||||
Cost of sales | (29 629 | ) | (69.8 | )% | (27 720 | ) | (67.6 | )% | 7 | % | ||||||||||||||
Gross profit | 12 817 | 30.2 | % | 13 264 | 32.4 | % | (3 | )% | ||||||||||||||||
Research and development expenses | (5 863 | ) | (13.8 | )% | (5 909 | ) | (14.4 | )% | (1 | )% | ||||||||||||||
Selling and marketing expenses | (3 877 | ) | (9.1 | )% | (3 933 | ) | (9.6 | )% | (1 | )% | ||||||||||||||
Administrative and general expenses | (1 115 | ) | (2.6 | )% | (1 145 | ) | (2.8 | )% | (3 | )% | ||||||||||||||
Other operating income and expenses | 108 | 0.3 | % | (1 080 | ) | (2.6 | )% | |||||||||||||||||
Operating profit | 2 070 | 4.9 | % | 1 197 | 2.9 | % | 73 | % | ||||||||||||||||
Year Ended December 31, | ||||||||
2010 | 2009 | |||||||
Europe | 34% | 36% | ||||||
Middle East & Africa | 13% | 14% | ||||||
Greater China | 18% | 16% | ||||||
Asia-Pacific | 21% | 22% | ||||||
North America | 5% | 5% | ||||||
Latin America | 9% | 7% | ||||||
Total | 100% | 100% | ||||||
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Year Ended | Year Ended | Percentage | ||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||
2010 | Net Sales | 2009 | Net Sales | (Decrease) | ||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||
Net sales | 29 134 | 100.0 | % | 27 853 | 100.0 | % | 5 | % | ||||||||||||
Cost of sales | (20 364 | ) | (69.9 | )% | (18 583 | ) | (66.7 | )% | 10 | % | ||||||||||
Gross profit | 8 770 | 30.1 | % | 9 270 | 33.3 | % | (5 | )% | ||||||||||||
Research and development expenses | (2 954 | ) | (10.1 | )% | (2 984 | ) | (10.7 | )% | (1 | )% | ||||||||||
Selling and marketing expenses | (2 294 | ) | (7.9 | )% | (2 366 | ) | (8.5 | )% | (3 | )% | ||||||||||
Administrative and general expenses | (393 | ) | (1.3 | )% | (417 | ) | (1.5 | )% | (6 | )% | ||||||||||
Other operating income and expenses | 170 | 0.6 | % | (189 | ) | (0.7 | )% | |||||||||||||
Operating profit | 3 299 | 11.3 | % | 3 314 | 11.9 | % | ||||||||||||||
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Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 20103 | 20093 | ||||||||||
(EUR millions, except percentage data) | ||||||||||||
Mobile phones1 | 14 347 | (5 | )% | 15 126 | ||||||||
Converged mobile devices2 | 14 786 | 17 | % | 12 676 | ||||||||
Total | 29 133 | 5 | % | 27 802 | ||||||||
(1) | Series 30 andSeries 40-based devices ranging from basic mobile phones focused on voice capability to devices with a number of additional functionalities, such as Internet connectivity, including the services and accessories sold with them. | |
(2) | Smartphones and mobile computers, including the services and accessories sold with them. | |
(3) | Does not include the net sales of the security appliance business that was divested in April 2009. |
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 2010 | 2009 | ||||||||||
(EUR millions, except percentage data) | ||||||||||||
Europe | 9 736 | (2 | )% | 9 890 | ||||||||
Middle East & Africa | 4 046 | 3 | % | 3 923 | ||||||||
Greater China | 6 167 | 23 | % | 5 028 | ||||||||
Asia-Pacific | 6 013 | (3 | )% | 6 230 | ||||||||
North America | 901 | (12 | )% | 1 020 | ||||||||
Latin America | 2 270 | 29 | % | 1 762 | ||||||||
Total | 29 133 | 5 | % | 27 853 | ||||||||
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010(1) | 2009 to 2010 | 2009 | ||||||||||
(Units in millions, except percentage data) | ||||||||||||
Europe | 289 | 8 | % | 267 | ||||||||
Middle East & Africa | 174 | 19 | % | 146 | ||||||||
Greater China | 265 | 13 | % | 234 | ||||||||
Asia-Pacific | 361 | 18 | % | 305 | ||||||||
North America | 151 | 14 | % | 132 | ||||||||
Latin America | 187 | 5 | % | 178 | ||||||||
Total | 1 427 | 13 | % | 1 263 | ||||||||
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(1) | As previously announced, beginning in 2010 we revised our definition of the industry mobile device market that we use to estimate industry volumes. This is due to improved measurement processes and tools that enable us to have better visibility to estimate the number of mobile devices sold by certain new entrants in the global mobile device market. We are applying the revised definition and improved measurement processes and tools beginning in 2010, and retrospectively to 2009 for comparative purposes only. |
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010(1) | 2009 to 2010 | 2009 | ||||||||||
(Units in millions, except percentage data) | ||||||||||||
Mobile phones1 | 352.6 | (3 | )% | 364.0 | ||||||||
Converged mobile devices2 | 100.3 | 48 | % | 67.8 | ||||||||
Total | 452.9 | 5 | % | 431.8 | ||||||||
(1) | Series 30 andSeries 40-based devices ranging from basic mobile phones focused on voice capability to devices with a number of additional functionalities, such as Internet connectivity, including the services and accessories sold with them. | |
(2) | Smartphones and mobile computers, including the services and accessories sold with them. |
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 2010 | 2009 | ||||||||||
(Units in millions, except percentage data) | ||||||||||||
Europe | 112.7 | 5 | % | 107.0 | ||||||||
Middle East & Africa | 83.8 | 8 | % | 77.6 | ||||||||
Greater China | 82.5 | 14 | % | 72.6 | ||||||||
Asia-Pacific | 119.1 | (4 | )% | 123.5 | ||||||||
North America | 11.1 | (18 | )% | 13.5 | ||||||||
Latin America | 43.7 | 16 | % | 37.6 | ||||||||
Total | 452.9 | 5 | % | 431.8 | ||||||||
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Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 2010 | 2009 | ||||||||||
(EUR millions, except percentage data) | ||||||||||||
Mobile phones1 | 41 | (2 | )% | 42 | ||||||||
Converged mobile devices2 | 147 | (21 | )% | 187 | ||||||||
Total | 64 | 0 | % | 64 | ||||||||
(1) | Series 30 andSeries 40-based devices ranging from basic mobile phones focused on voice capability to devices with a number of additional functionalities, such as Internet connectivity, including the services and accessories sold with them. | |
(2) | Smartphones and mobile computers, including the services and accessories sold with them. |
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Year Ended | Year Ended | |||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | |||||||||||||
2010 | Net Sales | 2009 | Net Sales | |||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||
Net sales | 1 002 | 100.0 | % | 670 | 100.0 | % | ||||||||||
Cost of sales | (153 | ) | (15.3 | )% | (88 | ) | (13.1 | )% | ||||||||
Gross profit | 849 | 84.7 | % | 582 | 86.9 | % | ||||||||||
Research and development expenses | (751 | ) | (75.0 | )% | (653 | ) | (97.5 | )% | ||||||||
Selling and marketing expenses | (250 | ) | (25.0 | )% | (217 | ) | (32.4 | )% | ||||||||
Administrative and general expenses | (70 | ) | (7.0 | )% | (57 | ) | (8.5 | )% | ||||||||
Other operating income and expenses | (3 | ) | (0.3 | )% | 1 | |||||||||||
Operating profit | (225 | ) | (22.5 | )% | (344 | ) | (51.3 | )% | ||||||||
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Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 2010 | 2009 | ||||||||||
(EUR millions, except percentage data) | ||||||||||||
Europe | 429 | 38 | % | 312 | ||||||||
Middle East & Africa | 60 | 107 | % | 29 | ||||||||
Greater China | 92 | 5 | ||||||||||
Asia-Pacific | 73 | 306 | % | 18 | ||||||||
North America | 325 | 11 | % | 293 | ||||||||
Latin America | 23 | 77 | % | 13 | ||||||||
Total | 1 002 | 50 | % | 670 | ||||||||
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Year Ended | Year Ended | Percentage | ||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||
2010 | Net Sales | 2009 | Net Sales | (Decrease) | ||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||
Net sales | 12 661 | 100.0 | % | 12 574 | 100.0 | % | 1 | % | ||||||||||||
Cost of Sales | (9 266 | ) | (73.2 | )% | (9 162 | ) | (72.9 | )% | 1 | % | ||||||||||
Gross profit | 3 395 | 26.8 | % | 3 412 | 27.1 | % | (1 | )% | ||||||||||||
Research and development expenses | (2 156 | ) | (17.0 | )% | (2 271 | ) | (18.1 | )% | (5 | )% | ||||||||||
Selling and marketing expenses | (1 328 | ) | (10.5 | )% | (1 349 | ) | (10.7 | )% | (2 | )% | ||||||||||
Administrative and general expenses | (553 | ) | (4.4 | )% | (573 | ) | (4.6 | )% | (4 | )% | ||||||||||
Other income and expenses | (44 | ) | (0.3 | )% | (858 | ) | (6.8 | )% | (95 | )% | ||||||||||
Operating profit | (686 | ) | (5.4 | )% | (1 639 | ) | (13.0 | )% | (58 | )% | ||||||||||
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2010 | 2009 to 2010 | 2009 | ||||||||||
(EUR millions, except percentage data) | ||||||||||||
Europe | 4 628 | (1 | )% | 4 695 | ||||||||
Middle East & Africa | 1 451 | (12 | )% | 1 653 | ||||||||
Greater China | 1 451 | 4 | % | 1 397 | ||||||||
Asia-Pacific | 2 915 | 7 | % | 2 725 | ||||||||
North America | 735 | (2 | )% | 748 | ||||||||
Latin America | 1 481 | 9 | % | 1 356 | ||||||||
Total | 12 661 | 1 | % | 12 574 | ||||||||
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Year Ended | Year Ended | Percentage | ||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||
2009 | Net Sales | 2008 | Net Sales | (Decrease) | ||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||
Net sales | 40 984 | 100.0 | % | 50 710 | 100.0 | % | (19.2 | )% | ||||||||||||
Cost of sales | (27 720 | ) | (67.6 | )% | (33 337 | ) | (65.7 | )% | (16.8 | )% | ||||||||||
Gross profit | 13 264 | 32.4 | % | 17 373 | 34.3 | % | (23.7 | )% | ||||||||||||
Research and development expenses | (5 909 | ) | (14.4 | )% | (5 968 | ) | (11.8 | )% | (1.0 | )% | ||||||||||
Selling and marketing expenses | (3 933 | ) | (9.6 | )% | (4 380 | ) | (8.6 | )% | (10.2 | )% | ||||||||||
Administrative and general expenses | (1 145 | ) | (2.8 | )% | (1 284 | ) | (2.5 | )% | (10.8 | )% | ||||||||||
Other operating income and expenses | (1 080 | ) | (2.6 | )% | (775 | ) | (1.5 | )% | 39.4 | % | ||||||||||
Operating profit | 1 197 | 2.9 | % | 4 966 | 9.8 | % | 75.9 | % | ||||||||||||
Year Ended December 31, | ||||||||
2009 | 2008 | |||||||
Europe | 36 | % | 37 | % | ||||
Middle East & Africa | 14 | % | 14 | % | ||||
Greater China | 16 | % | 13 | % | ||||
Asia-Pacific | 22 | % | 22 | % | ||||
North America | 5 | % | 4 | % | ||||
Latin America | 7 | % | 10 | % | ||||
Total | 100 | % | 100 | % | ||||
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Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2009(1) | 2008 to 2009 | 2008 | ||||||||||
(Units in millions, except percentage data) | ||||||||||||
Europe | 252 | (10 | )% | 281 | ||||||||
Middle East & Africa | 137 | (8 | )% | 149 | ||||||||
Greater China | 188 | 3 | % | 183 | ||||||||
Asia-Pacific | 275 | (3 | )% | 284 | ||||||||
North America | 172 | (3 | )% | 178 | ||||||||
Latin America | 115 | (17 | )% | 139 | ||||||||
Total | 1 140 | (6 | )% | 1 213 | ||||||||
(1) | Beginning in 2010, we revised our definition of the industry mobile device market that we use to estimate industry volumes. This was due to improved measurement processes and tools that enabled us to have better visibility to estimate the number of mobile devices sold by certain new entrants in the global mobile device market. These included vendors of legitimate, as well as unlicensed and counterfeit, products with manufacturing facilities primarily centered around |
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certain locations in Asia and other emerging markets. For comparative purposes only, applying the revised definition and improved measurement processes and tools that we were using since the beginning of 2010 retrospectively to 2009, we estimate that industry mobile device volumes in 2009 would have been 1.26 billion units. We are not able to apply our revised definition and improved measurement processes and tools retrospectively to our estimated industry mobile device volumes in 2008 due to lack of visibility and data. The industry mobile device volumes estimated for 2008 are not comparable with the industry mobile device volumes estimates based on the revised definition. |
Year Ended | Year Ended | |||||||||||
December 31, | Change | December 31, | ||||||||||
2009(*) | 2008 to 2009 | 2008 | ||||||||||
(Units in millions, except percentage data) | ||||||||||||
Europe | 107.0 | (6.9 | )% | 114.9 | ||||||||
Middle East & Africa | 77.7 | (4.1 | )% | 81.0 | ||||||||
Greater China | 72.6 | 1.8 | % | 71.3 | ||||||||
Asia-Pacific | 123.5 | (7.8 | )% | 134.0 | ||||||||
North America | 13.5 | (14.0 | )% | 15.7 | ||||||||
Latin America | 37.5 | (27.2 | )% | 51.5 | ||||||||
Total | 431.8 | (7.8 | )% | 468.4 | ||||||||
* | For comparative purposes only, applying the revised definition of the industry mobile device market (see note 1 to the industry mobile device volume table above) retrospectively to 2009, Nokia estimates that its mobile device volume market share would have been 34% in 2009 on an annual basis. Nokia is not able to apply the revised definition and improved measurement processes and tools retrospectively to Nokia’s estimated volume market share in 2008 due to lack of visibility and data. Nokia’s volume market share estimated for 2008 is not comparable with Nokia’s volume market share estimates based on the revised definition. |
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Year Ended | Year Ended | Percentage | ||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||
2009 | Net Sales | 2008 | Net Sales | (Decrease) | ||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||
Net sales | 27 853 | 100.0 | % | 35 099 | 100.0 | % | (21 | )% | ||||||||||||
Cost of sales | (18 583 | ) | (66.7 | )% | (22 360 | ) | (63.7 | )% | (17 | )% | ||||||||||
Gross profit | 9 270 | 33.3 | % | 12 739 | 36.3 | % | (27 | )% | ||||||||||||
Research and development expenses | (2 984 | ) | (10.7 | )% | (3 127 | ) | (8.9 | )% | (5 | )% | ||||||||||
Selling and marketing expenses | (2 366 | ) | (8.5 | )% | (2 847 | ) | (8.1 | )% | (17 | )% | ||||||||||
Administrative and general expenses | (417 | ) | (1.5 | )% | (429 | ) | (1.2 | )% | (3 | )% | ||||||||||
Other operating income and expenses | (189 | ) | (0.7 | )% | (520 | ) | (1.5 | )% | (64 | )% | ||||||||||
Operating profit | 3 314 | 11.9 | % | 5 816 | 16.6 | % | (43 | )% | ||||||||||||
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Year Ended | From July 10 to | |||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | |||||||||||||
2009 | Net Sales | 2008 | Net Sales | |||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||
Net sales | 670 | 100.0 | % | 361 | 100.0 | % | ||||||||||
Cost of sales | (88 | ) | (13.1 | )% | (43 | ) | (11.9 | )% | ||||||||
Gross profit | 582 | 86.9 | % | 318 | 88.1 | % | ||||||||||
Research and development expenses | (653 | ) | (97.5 | )% | (332 | ) | (92.0 | )% | ||||||||
Selling and marketing expenses | (217 | ) | (32.4 | )% | (109 | ) | (30.2 | )% | ||||||||
Administrative and general expenses | (57 | ) | (8.5 | )% | (30 | ) | (8.3 | )% | ||||||||
Other operating income and expenses | 1 | 0.1 | % | — | 0.0 | % | ||||||||||
Operating profit | (344 | ) | (51.3 | )% | (153 | ) | (42.4 | )% | ||||||||
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For the Year Ended | From July 10 to | |||||||
December 31, | December 31, | |||||||
2009 | 2008 | |||||||
(EUR millions) | (EUR millions) | |||||||
Europe | 312 | 158 | ||||||
Middle East & Africa | 29 | 29 | ||||||
Greater China | 5 | 2 | ||||||
Asia-Pacific | 18 | 10 | ||||||
North America | 293 | 155 | ||||||
Latin America | 13 | 7 | ||||||
Total | 670 | 361 | ||||||
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Year Ended | Year Ended | Percentage | ||||||||||||||||||
December 31, | Percentage of | December 31, | Percentage of | Increase/ | ||||||||||||||||
2009 | Net Sales | 2008 | Net Sales | (Decrease) | ||||||||||||||||
(EUR millions, except percentage data) | ||||||||||||||||||||
Net sales | 12 574 | 100.0 | % | 15 309 | 100.0 | % | (18 | )% | ||||||||||||
Cost of Sales | (9 162 | ) | (72.9 | )% | (10 993 | ) | (71.8 | )% | (17 | )% | ||||||||||
Gross profit | 3 412 | 27.1 | % | 4 316 | 28.2 | % | (21 | )% | ||||||||||||
Research and development expenses | (2 271 | ) | (18.1 | )% | (2 500 | ) | (16.3 | )% | (9 | )% | ||||||||||
Selling and marketing expenses | (1 349 | ) | (10.7 | )% | (1 421 | ) | (9.3 | )% | (5 | )% | ||||||||||
Administrative and general expenses | (573 | ) | (4.6 | )% | (689 | ) | (4.5 | )% | (17 | )% | ||||||||||
Other income and expenses | (858 | ) | (6.8 | )% | (7 | ) | (0.0 | )% | ||||||||||||
Operating profit | (1 639 | ) | (13.0 | )% | (301 | ) | (2.0 | )% | (445 | )% | ||||||||||
Year Ended | Year Ended | |||||||
December 31, | December 31, | |||||||
2009 | 2008 | |||||||
(EUR millions) | ||||||||
Europe | 4 695 | 5 618 | ||||||
Middle East & Africa | 1 653 | 2 040 | ||||||
Greater China | 1 397 | 1 379 | ||||||
Asia-Pacific | 2 725 | 3 881 | ||||||
North America | 748 | 698 | ||||||
Latin America | 1 356 | 1 693 | ||||||
Total | 12 574 | 15 309 | ||||||
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At December 31, | ||||||||||||
2010 | 2009 | 2008 | ||||||||||
(EUR millions) | ||||||||||||
Financing commitments | 85 | 99 | 197 | |||||||||
Outstanding long-term loans (net of allowances and write-offs) | 64 | 46 | 27 | |||||||||
Current portion of outstanding long-term loans (net of allowances andwrite-offs) | 39 | 14 | 101 | |||||||||
Outstanding financial guarantees and securities pledged | — | — | 2 | |||||||||
Total | 188 | 159 | 327 | |||||||||
2011 | 2012-2013 | 2014-2015 | Thereafter | Total | ||||||||||||||||
(EUR millions) | ||||||||||||||||||||
Guarantees of Nokia’s performance | 640 | 149 | 56 | 139 | 984 |
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2011 | 2012-2013 | 2014-2015 | Thereafter | Total | ||||||||||||||||
(EUR millions) | ||||||||||||||||||||
Long-term liabilities | 116 | 133 | 1 977 | 2 220 | 4 446 | |||||||||||||||
Operating leases | 285 | 375 | 204 | 205 | 1 069 | |||||||||||||||
Purchase obligations | 2 307 | 290 | 8 | 1 | 2 606 | |||||||||||||||
Total | 2 708 | 798 | 2 189 | 2 426 | 8 121 | |||||||||||||||
ITEM 6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES |
Chairman Jorma Ollila, b. 1950 | Chairman of the Board of Directors of Nokia Corporation. Chairman of the Board of Directors of Royal Dutch Shell Plc. Board member since 1995. Chairman since 1999. | |
Master of Political Science (University of Helsinki). Master of Science (Econ.) (London School of Economics). Master of Science (Eng.) (Helsinki University of Technology). | ||
Chairman and CEO, Chairman of the Group Executive Board of Nokia Corporation 1999-2006. President and CEO, Chairman of the Group Executive Board of Nokia Corporation 1992-1999. President of Nokia Mobile Phones 1990-1992. Senior Vice President, Finance of Nokia 1986-1989. Holder of various managerial positions at Citibank within corporate banking 1978-1985. |
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Vice Chairman of the Board of Directors of Otava Ltd. Member of the Board of Directors of the University of Helsinki. Chairman of the Boards of Directors and the Supervisory Boards of The Research Institute of the Finnish Economy ETLA and Finnish Business and Policy Forum EVA. Member of The European Round Table of Industrialists. Chairman of the World Business Council for Sustainable Development (WBCSD). Member of the Board of Directors of Ford Motor Company 2000-2008. Vice Chairman of UPM-Kymmene Corporation 2004-2008. | ||
Vice Chairman Dame Marjorie Scardino, b. 1947 | Chief Executive and member of the Board of Directors of Pearson plc. Board member since 2001. Vice Chairman since 2007. Chairman of the Corporate Governance and Nomination Committee. Member of the Personnel Committee. | |
Bachelor of Arts (Baylor University). Juris Doctor (University of San Francisco). | ||
Chief Executive of The Economist Group 1993-1997. President of the North American Operations of The Economist Group 1985-1993. Lawyer 1976-1985 and publisher of The Georgia Gazette newspaper 1978-1985. | ||
Lalita D. Gupte, b. 1948 | Non-executive Chairman of the ICICI Venture Funds Management Co Ltd. Board member since 2007. Member of the Audit Committee. | |
B.A. (Economics, Hons) (University of Delhi). Master of Management Studies (University of Bombay). | ||
Joint Managing Director and member of the Board of Directors of ICICI Bank Ltd 2002-2006. Joint Managing Director and member of the Board of Directors of ICICI Limited 1999-2002 (ICICI Limited merged with ICICI Bank Ltd in 2002). Deputy Managing Director of ICICI Limited 1996-1999. Executive Director on the Board of Directors of ICICI Limited 1994-1996. Various leadership positions in Corporate and Retail Banking, Strategy and Resources, and International Banking in ICICI Limited since 1971. | ||
Member of the Boards of Directors of Alstom S.A., Bharat Forge Ltd., Godrej Properties Ltd., and Kirloskar Brothers Ltd. Member of the Board of Directors of HPCL-Mittal Energy Ltd. and Swadhaar FinServe Pvt. Ltd. (non-executive Chairman). Also member of Board of Governors of educational institutions. Member of the Board of Directors (non-executive director) of ICICI Bank Ltd. 1994-2002. Member of the Boards of Directors of FirstSource Solutions Ltd. 2006-2010, ICICI Securities Ltd. 1993-2006, ICICI Prudential Life Insurance Co Ltd. 2000-2006, ICICI Lombard General Insurance Co Ltd.2000-2006, ICICI Bank UK Ltd. 2003-2006, ICICI Bank Canada 2003-2006 and ICICI Bank Eurasia Ltd. 2005-2006. |
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Dr. Bengt Holmström, b. 1949 | Paul A. Samuelson Professor of Economics at MIT, joint appointment at the MIT Sloan School of Management. Board member since 1999. | |
Bachelor of Science (Helsinki University). Master of Science (Stanford University). Doctor of Philosophy (Stanford University). | ||
Edwin J. Beinecke Professor of Management Studies at Yale University 1985-1994. | ||
Member of the American Academy of Arts and Sciences and Foreign Member of The Royal Swedish Academy of Sciences. Member of the Boards of Directors of The Research Institute of the Finnish Economy ETLA and Finnish Business and Policy Forum EVA. Member of Aalto University Foundation Board. | ||
Prof. Dr. Henning Kagermann, b. 1947 | Board member since 2007. Member of the Personnel Committee. | |
Ph.D. (Theoretical Physics) (Technical University of Brunswick). | ||
Co-CEO and Chairman of the Executive Board of SAP AG2008-2009. CEO of SAP 2003-2008. Co-chairman of the Executive Board of SAP AG 1998-2003. A number of leadership positions in SAP AG since 1982. Member of SAP Executive Board 1991-2009. Taught physics and computer science at the Technical University of Brunswick and the University of Mannheim 1980-1992, became professor in 1985. | ||
Member of the Supervisory Boards of Bayerische Motoren Werke Aktiengesellschaft (BMW AG), Deutsche Bank AG, Deutsche Post AG and Münchener Rückversicherungs-Gesellschaft AG (Munich Re). Member of the Board of Directors of Wipro Ltd. President of Deutsche Akademie der Technikwissenschaften. Member of the Honorary Senate of the Foundation Lindau Nobelprizewinners. | ||
Per Karlsson, b. 1955 | Independent Corporate Advisor. Board member since 2002. Chairman of the Personnel Committee. Member of the Corporate Governance and Nomination Committee. | |
Degree in Economics and Business Administration (Stockholm School of Economics). | ||
Executive Director, with mergers and acquisitions advisory responsibilities, at Enskilda M&A, Enskilda Securities (London) 1986-1992. Corporate strategy consultant at the Boston Consulting Group (London) 1979-1986. | ||
Member of the Board of Directors of IKANO Holdings S.A. | ||
Isabel Marey-Semper, b. 1967 | Director of Advanced Research of L’Oréal Group. Board member since 2009. Member of the Audit Committee. |
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Ph.D. (Neuro-Pharmacology) (Université Paris Pierre et Marie Curie—Collège de France). MBA (Collège des Ingénieurs, Paris). | ||
Director of Shared Services of L’Oréal Group 2010-2011. Chief Financial Officer, Executive Vice President in charge of strategy of PSA Peugeot Citroën 2007-2009. COO, Intellectual Property and Licensing Business Unit of Thomson 2006-2007. Vice President Corporate Planning at Saint-Gobain 2004-2005. Director of Corporate Planning, High Performance Materials of Saint-Gobain 2002-2004. Principal of A.T. Kearney (Telesis, prior to acquisition by A.T. Kearney) 1997-2002. | ||
Member of the Board of Directors of Faurecia S.A. 2007-2009. | ||
Risto Siilasmaa, b. 1966 | Board member since 2008. Chairman of the Audit Committee. Member of the Corporate Governance and Nomination Committee. | |
Master of Science (Eng) (Helsinki University of Technology). | ||
President and CEO of F-Secure Corporation 1988-2006. | ||
Chairman of the Boards of Directors of F-Secure Corporation and Elisa Corporation. Chairman of the Board of Directors of Fruugo Inc. Member of the Boards of Directors of Blyk Ltd, Efecte Corporation, Ekahau Inc and Mendor Ltd. Member of the Board of Directors of The Federation of Finnish Technology Industries. | ||
Keijo Suila, b. 1945 | Board member since 2006. Member of the Personnel Committee. | |
B.Sc. (Economics and Business Administration) (Helsinki University of Economics and Business Administration). | ||
President and CEO of Finnair Plc 1999-2005. Chairman of oneworld airline alliance 2003-2004. Member of various international aviation and air transportation associations 1999-2005. Holder of various executive positions, including Vice Chairman and Executive Vice President, at Huhtamäki Oyj, Leaf Group and Leaf Europe 1985-1998. | ||
Chairman of the Board of Directors of Solidium Oy. Chairman of the Board of Directors of the Finnish Fair Corporation. Member of the Board of Directors of Kesko Corporation2001-2009 and Vice Chairman 2006-2009. |
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• | Hallstein Moerk, formerly Executive Vice President of Human Resources, resigned from the Group Executive Board effective March 31, 2010, Thereafter, Mr. Moerk served as Executive Advisor for Nokia until his retirement at the end of September 2010. |
• | Juha Äkräs was appointed Executive Vice President of Human Resources and member of the Group Executive Board effective April 1, 2010. |
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• | Richard Simonson, formerly Executive Vice President of Mobile Phones, resigned from the Group Executive Board effective June 30, 2010. Thereafter, Mr. Simonson served as Senior Advisor to Nokia until he left the company on October 1, 2010. |
• | Anssi Vanjoki, formerly Executive Vice President of Mobile Solutions, resigned from the Group Executive Board effective October 12, 2010. Thereafter, Mr. Vanjoki’s employment with Nokia has continued until the end of his notice of resignation period on March 11, 2011. |
• | Jerri DeVard was appointed Executive Vice President and Chief Marketing Officer and a member of the Group Executive Board as from January 1, 2011. |
• | Alberto Torres, formerly Executive Vice President of MeeGo Computers, resigned from the Group Executive Board on February 10, 2011, leaving the company on March 31, 2011. |
• | On February 11, 2011 we announced our new strategy, including changes to our leadership team and operational structure. Effective from that day, the Nokia Leadership Team replaced the Group Executive Board. |
Stephen Elop, b. 1963 | President and CEO of Nokia Corporation. Nokia Leadership Team member and Chairman since September 21, 2010. Joined Nokia on September 21, 2010. | |
Bachelor of Computer Engineering and Management (McMaster University, Hamilton, Canada). Doctor of Laws, honorary (McMaster University, Hamilton, Canada). | ||
President of Microsoft Business Division and member of senior membership team of Microsoft Corporation 2008-2010. COO, Juniper Networks, Inc. 2007-2008. President, Worldwide Field Operations, Adobe Systems Inc. 2005-2006. President and CEO (last position), Macromedia Inc. 1998-2005. | ||
Chairman of the Board of Directors of NAVTEQ Corporation. | ||
Esko Aho, b. 1954 | Executive Vice President, Corporate Relations and Responsibility. Nokia Leadership Team member since 2009. Joined Nokia 2008. | |
Master of Social Sciences (University of Helsinki). | ||
President of the Finnish Innovation Fund, Sitra 2004-2008. Private consultant 2003-2004. Lecturer, Harvard University 2000-2001. Prime Minister of Finland 1991-1995. Chairman of the Centre Party 1990-2002. Member of the Finnish Parliament 1983-2003. Elector in the presidential elections of 1978, 1982 and 1988. | ||
Member of the Board of Directors of Fortum Corporation. Member of the Board of Directors of Technology Academy Finland. Vice Chairman of the Board of Directors of the Federation of Finnish Technology Industries. Member of the Club de Madrid, the InterAction Council, the Science and Technology in Society Forum (STS). Member of the ICC World Council and Vice Chair of ICC Finland. |
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Jerri DeVard, b. 1958 | Executive Vice President, Chief Marketing Officer. Nokia Leadership Team member since January 1, 2011. Joined Nokia on January 1, 2011. | |
B.A. (Economics) (Spelman College, Atlanta, Georgia, USA). M.B.A. (Marketing) (Clark Atlanta University Graduate School of Business, Atlanta, Georgia, USA). | ||
Principal, DeVard Marketing Group 2007-2010. Senior Vice President, Marketing and Brand Management, Verizon Communications Inc. 2005-2007. Senior Vice President, Marketing Communications and Brand Management, Verizon Communications Inc. 2003-2005. Chief Marketing Officer ofe-Consumer, Citigroup 2000-2002. Management positions at Citigroup 1998-2000. Vice President, Marketing, Color Cosmetics, Revlon Inc. 1996-1998. Vice President, Sales and Marketing, Harrah’s Entertainment 1994-1996. Several brand management positions at the Pillsbury Co. 1983-1993. | ||
Member of the Board of Directors of Belk Inc. Vice Chair of the Board of Trustees of Spelman College. Member of the PepsiCo African-American Advisory Board. | ||
Colin Giles, b. 1963 | Executive Vice President, Sales. Nokia Leadership Team member since February 11, 2011. Joined Nokia 1992. | |
Bachelor’s degree engineering (University of Western Australia). EMBA (London Business School). | ||
Senior Vice President, Sales, Markets, Nokia 2010. President and Senior Vice President for Greater China, Japan and Korea, Nokia 2009-2010. Senior Vice President, Sales, Distribution East, Nokia 2008-2009. Senior Vice President, CMO, Greater China, Nokia 2002-2008. Vice President Sales and Marketing, China, Nokia 2001-2002. General Manager, Taiwan, Nokia 1997-2001. Director, Marketing, Asia Pacific, Nokia 1994-1997. Management positions in several telecommunications companies in Australia and the United Kingdom. | ||
Richard Green, b. 1955 | Executive Vice President, Chief Technology Officer. Nokia Leadership Team member since February 11, 2011. Joined Nokia on May 3, 2010. | |
Bachelor’s and Master’s degrees (State University of New York, Albany). | ||
Senior Vice President and Chief Technology Officer, Mobile Solutions, Nokia 2010. Executive Vice President, Software Division, Sun Microsystems, Inc., 2006-2008. Senior roles at Casatt Software and Nuance. | ||
Member of the Board of Directors of Albany Foundation. | ||
Jo Harlow, b. 1962 | Executive Vice President, Smart Devices. Nokia Leadership Team member since February 11, 2011. Joined Nokia 2003. |
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Bachelor of science (psychology) (Duke University, Durham, North Carolina, USA). | ||
Senior Vice President, Symbian Smartphones, Mobile Solutions, Nokia 2010. Senior Vice President, Smartphones Product Management, Nokia 2009. Vice President, Live Category, Nokia 2008-2009. Senior Vice President, Marketing, Mobile Phones, Nokia 2006-2007. Vice President, Marketing, North America, Mobile Phones, Nokia 2003-2005. Marketing, sales and management roles at Reebok 1992-2003 and Procter & Gamble 1984-1992. | ||
Timo Ihamuotila, b. 1966 | Executive Vice President, Chief Financial Officer. Nokia Leadership Team member since 2007. With Nokia 1993-1996, rejoined 1999. | |
Master of Science (Economics) (Helsinki School of Economics). Licentiate of Science (Finance) (Helsinki School of Economics). | ||
Executive Vice President, Sales, Markets, Nokia 2008-2009. Executive Vice President, Sales and Portfolio Management, Mobile Phones, Nokia 2007. Senior Vice President, CDMA Business Unit, Mobile Phones, Nokia 2004-2007. Vice President, Finance, Corporate Treasurer, Nokia 2000-2004. Director, Corporate Finance, Nokia 1999-2000. Vice President of Nordic Derivates Sales, Citibank plc. 1996-1999. Manager, Dealing & Risk Management, Nokia 1993-1996. Analyst, Assets and Liability Management, Kansallis Bank 1990-1993. | ||
Member of the Boards of Directors of NAVTEQ Corporation and Nokia Siemens Networks B.V. Member of the Board of Directors of Central Chamber of Commerce of Finland. | ||
Mary T. McDowell, b. 1964 | Executive Vice President, Mobile Phones. Nokia Leadership Team member since 2004. Joined Nokia 2004. | |
Bachelor of Science (Computer Science) (College of Engineering at the University of Illinois). | ||
Executive Vice President and Chief Development Officer, Nokia 2008-2010. Executive Vice President and General Manager of Enterprise Solutions, Nokia 2004-2007. Senior Vice President & General Manager, Industry-Standard Servers, Hewlett-Packard Company 2002-2003. Senior Vice President & General Manager, Industry-Standard Servers, Compaq Computer Corporation 1998-2002. Vice President, Marketing, Server Products Division of Compaq Computer Corporation 1996-1998. Holder of executive, managerial and other positions at Compaq Computer Corporation 1986-1996. | ||
Member of the Board of Directors of Autodesk, Inc. Member of the Board of Visitors of the College of Engineering at the University of Illinois. | ||
Dr. Tero Ojanperä, b. 1966 | Executive Vice President, acting Head of Services and Developer Experience. |
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Nokia Leadership Team member since 2005. Joined Nokia 1990. | ||
Master of Science (University of Oulu). Ph.D. (Delft University of Technology, The Netherlands). | ||
Executive Vice President, Chief Technology Officer, Nokia2006-2007. Executive Vice President and Chief Strategy Officer, Nokia 2005-2006. Senior Vice President, Head of Nokia Research Center 2003-2004. Vice President, Research, Standardization and Technology of IP Mobility Networks, Nokia Networks 1999-2002. Vice President, Radio Access Systems Research and General Manager of Nokia Networks in Korea 1999. Head of Radio Access Systems Research, Nokia Networks 1998-1999. Principal Engineer, Nokia Research Center 1997-1998. | ||
Member of the Board of Directors of NAVTEQ Corporation. A member of Young Global Leaders. | ||
Louise Pentland, b 1972 | Executive Vice President, Chief Legal Officer. Nokia Leadership Team member since February 11, 2011. Joined Nokia 1998. | |
LL.B honors (law degree) (Newcastle upon Tyne). Qualified and active Solicitor (England and Wales). Licensed attorney (Member of the New York Bar). | ||
Senior Vice President and Chief Legal Officer,Nokia 2008-2010. Acting Chief Legal Officer, Nokia 2007-2008. Vice President and Head of Legal, Enterprise Solutions, Nokia 2004-2007. Senior Legal Counsel, Nokia Networks1998-2004. Before joining Nokia, corporate in-house legal positions at Avon Cosmetics Ltd. and law firm positions prior to that in the United Kingdom. | ||
Member of Association of General Counsel, CLO Roundtable—Europe, Global Leaders in Law, Corporate Counsel Forum. Vice chair of the International Bar Association. | ||
Niklas Savander, b. 1962 | Executive Vice President, Markets. Nokia Leadership Team member since 2006. Joined Nokia 1997. | |
Master of Science (Eng.) (Helsinki University of Technology). Master of Science (Economics and Business Administration) (Swedish School of Economics and Business Administration, Helsinki). | ||
Executive Vice President, Services, Nokia 2007-2010. Executive Vice President, Technology Platforms, Nokia 2006-2007. Senior Vice President and General Manager of Nokia Enterprise Solutions, Mobile Devices Business Unit 2003-2006. Senior Vice President, Nokia Mobile Software, Market Operations2002-2003. Vice President, Nokia Mobile Software, Strategy, Marketing & Sales 2001-2002. Vice President and General Manager of Nokia Networks, Mobile Internet Applications 2000-2001. Vice President of Nokia Network Systems, |
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Marketing 1997-1998. Holder of executive and managerial positions at Hewlett-Packard Company 1987-1997. | ||
Member of the Board of Directors of Nokia Siemens Networks B.V. Member of the Board of Directors and secretary of Waldemar von Frenckells Stiftelse. | ||
Juha Äkräs, b. 1965 | Executive Vice President, Human Resources. Nokia Leadership Team member as of April 1, 2010. Joined Nokia 1993. | |
Master of Science (Eng.) (Helsinki University of Technology). | ||
Senior Vice President, Human Resources, Nokia 2006-2010. Vice President, Global Operational Human Resources, Nokia 2005-2006. Senior Vice President and General Manager, Core Networks, Nokia Networks 2003-2005. Vice President and General Manager, IP Networks, Nokia Networks 2002-2003. Vice President, Strategy and Business Development, Nokia Networks 2000-2001. Vice President, Customer Services APAC, Nokia Telecommunications 1997-1999. Head of Marketing and Business Development, Customer Services, Nokia Telecommunications 1995-1996. Business Development Manager and Controller, Customer Services, Nokia Cellular Systems 1994-1995. Project Manager, Nokia Telecom AB (Sweden) 1993-1994. | ||
Member of the Board of Directors of Confederation of Finnish Industries (EK). | ||
Dr. Kai Öistämö, b. 1964 | Executive Vice President, Chief Development Officer. Nokia Leadership Team member since 2005. Joined Nokia 1991. | |
Doctor of Technology (Signal Processing). Master of Science (Engineering) (Tampere University of Technology). | ||
Executive Vice President, Devices, Nokia 2007-2010. Executive Vice President and General Manager of Mobile Phones, Nokia 2005-2007. Senior Vice President, Business Line Management, Mobile Phones, Nokia 2004-2005. Senior Vice President, Mobile Phones Business Unit, Nokia Mobile Phones 2002-2003. Vice President, TDMA/GSM 1900 Product Line, Nokia Mobile Phones 1999-2002. Vice President, TDMA Product Line1997-1999. Various technical and managerial positions in Nokia Consumer Electronics and Nokia Mobile Phones1991-1997. | ||
Member of the Board of Directors of Nokian Tyres plc. Member of the Board of Directors of NAVTEQ Corporation. |
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Position | 2010 (EUR) | 2009 (EUR) | 2008 (EUR) | |||||||||
Chairman | 440 000 | 440 000 | 440 000 | |||||||||
Vice Chairman | 150 000 | 150 000 | 150 000 | |||||||||
Member | 130 000 | 130 000 | 130 000 | |||||||||
Chairman of Audit Committee | 25 000 | 25 000 | 25 000 | |||||||||
Member of Audit Committee | 10 000 | 10 000 | 10 000 | |||||||||
Chairman of Personnel Committee | 25 000 | 25 000 | 25 000 | |||||||||
Total | 1 700 000 | (1)(2) | 1 840 000 | (1)(2) | 1 710 000 | (1)(2) | ||||||
(1) | The changes in the aggregate amount of Board pay from year to year are due to changes in the number of Board members and changes in committee composition, while the amount of fees paid for the services rendered remained the same. | |
(2) | The aggregate amount of Board pay also includes the remuneration paid to the former President and CEO in his capacity as a member of the Board of Directors, but in that capacity only. |
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Change in | ||||||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||||||
Fees | Non-Equity | and Nonqualified | ||||||||||||||||||||||||||||||
Earned or | Incentive | Deferred | ||||||||||||||||||||||||||||||
Paid in | Stock | Plan | Compensation | All Other | ||||||||||||||||||||||||||||
Cash | Awards | Option Awards | Compensation | Earnings | Compensation | Total | ||||||||||||||||||||||||||
Year | (EUR)(1) | (EUR)(2) | (EUR)(2) | (EUR)(2) | (EUR)(2) | (EUR)(2) | (EUR) | |||||||||||||||||||||||||
Jorma Ollila, Chairman(3) | 2010 | 440 000 | — | — | — | — | — | 440 000 | ||||||||||||||||||||||||
Marjorie Scardino, Vice Chairman(4) | 2010 | 150 000 | — | — | — | — | — | 150 000 | ||||||||||||||||||||||||
Lalita D. Gupte(5) | 2010 | 140 000 | — | — | — | — | — | 140 000 | ||||||||||||||||||||||||
Bengt Holmström | 2010 | 130 000 | — | — | — | — | — | 130 000 | ||||||||||||||||||||||||
Henning Kagermann | 2010 | 130 000 | — | — | — | — | — | 130 000 | ||||||||||||||||||||||||
Olli-Pekka Kallasvuo(6) | 2010 | 130 000 | 130 000 | |||||||||||||||||||||||||||||
Per Karlsson(7) | 2010 | 155 000 | — | — | — | — | — | 155 000 | ||||||||||||||||||||||||
Isabel Marey-Semper(8) | 2010 | 140 000 | — | — | — | — | — | 140 000 | ||||||||||||||||||||||||
Risto Siilasmaa(9) | 2010 | 155 000 | — | — | — | — | — | 155 000 | ||||||||||||||||||||||||
Keijo Suila | 2010 | 130 000 | — | — | — | — | — | 130 000 | ||||||||||||||||||||||||
Total | 1 700 000 | 1 700 000 | ||||||||||||||||||||||||||||||
(1) | Approximately 40% of each Board member’s annual remuneration is paid in Nokia shares purchased from the market and the remaining approximately 60% is paid in cash. | |
(2) | Not applicable to any non-executive member of the Board of Directors. Not applicable to the former President and CEO with respect to his service as a member of the Board of Directors. | |
(3) | Represents the fee of Jorma Ollila for service as Chairman of the Board. | |
(4) | Represents the fee of Dame Marjorie Scardino for service as Vice Chairman of the Board. | |
(5) | Represents the fees paid to Lalita Gupte, consisting of a fee of EUR 130 000 for service as a member of the Board and EUR 10 000 for service as a member of the Audit Committee. | |
(6) | Olli-Pekka Kallasvuo left his position on the Nokia Board of Directors on September 10, 2010. This table includes remuneration paid to Mr. Kallasvuo for service as a member of the Board only. For the compensation paid for his services as the President and CEO until September 20, 2010,see “—Executive Compensation—Actual Executive Compensation for 2010—Summary Compensation Table 2010” below. | |
(7) | Represents the fees paid to Per Karlsson, consisting of a fee of EUR 130 000 for service as a member of the Board and EUR 25 000 for service as Chairman of the Personnel Committee. | |
(8) | Represents the fees paid to Isabel Marey-Semper, consisting of a fee of EUR 130 000 for service as a member of the Board and EUR 10 000 for service as a member of the Audit Committee. | |
(9) | Represents the fees paid to Risto Siilasmaa, consisting of a fee of EUR 130 000 for service as a member of the Board and EUR 25 000 for service as Chairman of the Audit Committee. |
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• | competitive base pay rates; and | |
• | short- and long-term incentives that are intended to result in a competitive total compensation package. |
• | attract and retain outstanding executive talent; | |
• | deliver a significant amount of performance-related variable compensation for the achievement of both short- and long-term stretch goals; | |
• | appropriately balance rewards between both Nokia’s and an individual’s performance; and | |
• | align the interests of the executive officers with those of the shareholders through long-term incentives in the form of equity-based awards. |
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• | the compensation levels for similar positions (in terms of scope of position, revenues, number of employees, global responsibility and reporting relationships) in relevant comparison companies; | |
• | the performance demonstrated by the executive officer during the last year; | |
• | the size and impact of the particular officer’s role on Nokia’s overall performance and strategic direction; | |
• | the internal comparison to the compensation levels of the other executive officers of Nokia; and | |
• | past experience and tenure in role. |
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Minimum | Target | Maximum | ||||||||||||
Position | Performance | Performance | Performance | Measurement Criteria | ||||||||||
President and CEO(1) | 0 | % | 100 | % | 225 | % | (a) Financial and Business Objectives (includes targets for net sales, operating profit and operating cash flow management and key business goals) | |||||||
0 | % | 25 | % | 37.5 | % | (c) Total Shareholder Return(2) (comparison made with key competitors in the high technology, telecommunications and Internet services industries over one-, three- and five-year periods) | ||||||||
0 | % | 25 | % | 37.5 | % | (d) Strategic Objectives | ||||||||
Total | 0 | % | 150 | % | 300 | % | ||||||||
Group Executive Board | 0 | % | 75 | % | 168.75 | % | (a) Financial Objectives(includes targets for net sales, operating profit and operating cash flow management) | |||||||
(b) Individual Strategic Objectives(as described below) | ||||||||||||||
0 | % | 25 | % | 37.5 | % | (c) Total Shareholder Return(2)(3) (comparison made with key competitors in the high technology, telecommunications and Internet services industries over one-, three- and five-year periods) | ||||||||
Total | 0 | % | 100 | % | 206.25 | % | ||||||||
(1) | Applies for Olli-Pekka Kallasvuo, President and CEO until September 20, 2010. For Stephen Elop, President and CEO from September 21, 2010, short-term incentive target is 150% of base pay, paid to him pro rata for year 2010, based on his hire date. | |
(2) | Total shareholder return reflects the change in Nokia’s share price during an established time period, including the amount of dividends paid, divided by Nokia’s share price at the beginning of the period. The calculation is conducted in the same manner for each company in the peer group. | |
(3) | Only certain members of the Group Executive Board are eligible for the additional 25% total shareholder return element. |
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• | His target short-term cash incentive level is reduced from 150% to 100% and | |
• | His annual equity grants are reduced to a level below the competitive market value. |
(1) | Total Shareholder Return (TSR), relative to a peer group of companies over the 2 year period from December 31, 2010 until December 31, 2012: Minimum payout will require performance at the 50th percentile of the peer group and the maximum payout will occur if the rank is among the top three of the peer group. The peer group consists of a number of relevant companies in the high technology/mobility, telecommunications and Internet services industries, | |
(2) | Nokia’s absolute share price at the end of 2012: Minimum payout if the Nokia share price is EUR 9, with maximum payout if the Nokia share price is EUR 17. |
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Number of | Cash | |||||||||||
Members on | Base | Incentive | ||||||||||
Year | December 31 | Salaries | Payments(2) | |||||||||
EUR | EUR | |||||||||||
2010 | 9 | 5 552 108 | 3 457 145 |
(1) | Includes base salary and cash incentives paid or payable by Nokia for the 2010 fiscal year. The cash incentives are paid as a percentage of annual base salary based on Nokia’s short-term cash incentives. Includes compensation paid to Hallstein Moerk for the period until March 31, 2010, Richard Simonson until June 30, 2010, Olli-Pekka Kallasvuo until September 20, 2010, Anssi Vanjoki until October 12, 2010 and Juha Äkräs as from April 1, 2010 and Stephen Elop as from September 21, 2010. | |
(2) | Excluding any gains realized upon exercise of stock options, which are described in Item 6E. “Share Ownership.” |
Total number | ||||||||||||
Group Executive Board(3)(4) | Total | of participants | ||||||||||
Performance Shares at Threshold(2) | 485 000 | 3 576 403 | 4 250 | |||||||||
Stock Options | 1 320 000 | 6 708 582 | 3 200 | |||||||||
Restricted Shares | 1 104 000 | 5 801 800 | 430 |
(1) | The equity-based incentive grants are generally forfeited if the employment relationship terminates with Nokia prior to vesting. The settlement is conditional upon performance and/or service conditions, as determined in the relevant plan rules. For a description of our equity plans, see Note 24 to our consolidated financial statements included in Item 18 of this annual report. | |
(2) | At maximum performance, the settlement amounts to four times the number at threshold. | |
(3) | Includes Hallstein Moerk for the period until March 31, 2010, Richard Simonson until June 30, 2010, Olli-Pekka Kallasvuo until September 20, 2010, Anssi Vanjoki until October 12, 2010 and Juha Äkräs as from April 1, 2010 and Stephen Elop as from September 21, 2010. | |
(4) | For the Group Executive Board members whose employment terminated during 2010, the Long-Term Equity-Based Incentives were forfeited following termination of employment in accordance with plan rules. Mr. Vanjoki’s termination date under his employment agreement is March 11, 2011, and his equity will be forfeited thereafter. Mr. Moerk retained his vested and unvested grants upon retirement, in accordance with the equity plans’ provisions. |
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Change in | ||||||||||||||||||||||||||||||||||||
Pension Value | ||||||||||||||||||||||||||||||||||||
and Nonqualified | ||||||||||||||||||||||||||||||||||||
Name and | Non-Equity | Deferred | All Other | |||||||||||||||||||||||||||||||||
Principal | Stock | Option | Incentive Plan | Compensation | Compensation | |||||||||||||||||||||||||||||||
Position(1) | Year | Salary | Bonus(2) | Awards(3)(4) | Awards(3)(4) | Compensation | Earnings(5) | EUR | Total | |||||||||||||||||||||||||||
EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | |||||||||||||||||||||||||||||
Stephen Elop | ||||||||||||||||||||||||||||||||||||
President and CEO | 2010 | 280 303 | 440 137 | 1 682 607 | 800 132 | (* | ) | 340 471 | 3 115 276 | (6) | 6 658 926 | |||||||||||||||||||||||||
Olli-Pekka Kallasvuo | 2010 | 979 758 | 676 599 | 3 267 288 | 641 551 | (* | ) | (7) | 5 524 061 | (8) | 11 089 257 | |||||||||||||||||||||||||
President and CEO | 2009 | 1 176 000 | 1 288 144 | 3 332 940 | 650 661 | (* | ) | 1 358 429 | 177 248 | 7 983 422 | ||||||||||||||||||||||||||
until September 20, 2010 | 2008 | 1 144 800 | 721 733 | 2 470 858 | 548 153 | (* | ) | 469 060 | 175 164 | 5 529 768 | ||||||||||||||||||||||||||
Timo Ihamuotila | ||||||||||||||||||||||||||||||||||||
EVP, Chief Financial | 2010 | 423 524 | 245 634 | 1 341 568 | 166 328 | (* | ) | 31 933 | 8 893 | (9) | 2 217 880 | |||||||||||||||||||||||||
Officer | 2009 | 396 825 | 234 286 | 752 856 | 135 834 | (* | ) | 15 575 | 21 195 | 1 556 571 | ||||||||||||||||||||||||||
2010 | 559 637 | 314 782 | 1 233 368 | 142 567 | (* | ) | 71 386 | (11) | 2 321 740 | |||||||||||||||||||||||||||
Mary T. McDowell | 2009 | 508 338 | 349 911 | 800 873 | 152 283 | (* | ) | 33 726 | 1 845 131 | |||||||||||||||||||||||||||
EVP, Mobile Phones(10) | 2008 | 493 798 | 196 138 | 620 690 | 133 463 | (* | ) | 33 462 | 1 477 551 | |||||||||||||||||||||||||||
Kai Öistämö | 2010 | 481 067 | 248 608 | 1 212 143 | 166 328 | (* | ) | (12) | 18 365 | (13) | 2 126 511 | |||||||||||||||||||||||||
EVP, Chief Development | 2009 | 460 000 | 343 225 | 935 174 | 166 126 | (* | ) | 9 824 | 29 778 | 1 944 127 | ||||||||||||||||||||||||||
Officer | 2008 | 445 143 | 200 126 | 699 952 | 152 529 | (* | ) | 87 922 | 29 712 | 1 615 384 | ||||||||||||||||||||||||||
Niklas Savander | ||||||||||||||||||||||||||||||||||||
EVP, Markets | 2010 | 441 943 | 247 086 | 1 233 368 | 142 567 | (* | ) | (12) | 23 634 | (14) | 2 088 598 | |||||||||||||||||||||||||
Richard Simonson EVP, | 2010 | 640 221 | 372 870 | 1 508 474 | 166 328 | (* | ) | 77 920 | (15) | 2 765 814 | ||||||||||||||||||||||||||
Mobile Phones until | 2009 | 648 494 | 453 705 | 1 449 466 | 166 126 | (* | ) | 134 966 | 2 852 757 | |||||||||||||||||||||||||||
June 30, 2010(10) | 2008 | 630 263 | 293 477 | 699 952 | 152 529 | (* | ) | 106 632 | 1 882 853 |
(1) | The positions set forth in this table are the current positions of the named executives. Mr. Elop was appointed President and CEO effective September 21, 2010; Mr. Kallasvuo served as President and CEO until September 20, 2010; Ms. McDowell served as Executive Vice President, Corporate Development until June 30, 2010; Mr. Öistämö served as Executive Vice President, Devices until June 30, 2010; Mr. Savander served as Executive Vice President, Services until June 30, 2010; also Mr. Simonson served as Executive Vice President, Mobile Phones until June 30, 2010. | |
(2) | Bonus payments are part of Nokia’s short-term cash incentives. The amount consists of the bonus earned and paid or payable by Nokia for the respective fiscal year. | |
(3) | Amounts shown represent the grant date fair value of equity grants awarded for the respective fiscal year. The fair value of stock options equals the estimated fair value on the grant date, calculated using the Black-Scholes model. The fair value of performance shares and restricted shares equals the estimated fair value on grant date. The estimated fair value is based on the grant date market price of the Nokia share less the present value of dividends expected to be paid during the vesting period. The value of the performance shares is presented on the basis of granted number of shares, which is two times the number of shares at threshold. The value of the stock awards with performance shares valued at maximum (four times the number of shares at threshold), for each of the named executive officer, is as follows: Mr. Elop EUR 2 718 091; Mr. Kallasvuo EUR 4 854 540; Mr. Ihamuotila EUR 1 753 078; Ms. McDowell EUR 1 586 091; Mr. Öistämö EUR 1 623 653; Mr. Savander EUR 1 586 091; and Mr. Simonson EUR 1 919 984. | |
(4) | Mr. Kallasvuo’s and Mr. Simonson’s equity grants were forfeited and cancelled following end of employment in accordance with plan provisions. | |
(5) | The change in pension value represents the proportionate change in the liability related to the individual executives. These executives are covered by the Finnish State employees’ pension act (“TyEL”) that provides for a retirement benefit based on years of service and earnings according to the prescribed statutory system. The TyEL system is a partly funded and a partly pooled “pay as you go” system. Effective March 1, 2008, Nokia transferred its TyEL pension liability and assets to an external Finnish insurance company and no longer carries the liability on its financial statements. The figures shown represent only the change in liability for the funded portion. The |
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method used to derive the actuarial IFRS valuation is based upon available salary information at the respective year end. Actuarial assumptions including salary increases and inflation have been determined to arrive at the valuation at the respective year end. Ms. McDowell participates and Mr. Simonson participated until October 2, 2010 in Nokia’s U.S Retirement Savings and Investment Plan, as described in “—Actual Executive Compensation for 2010—Pension Arrangements for the Members of the Nokia Leadership Team (formerly Group Executive Board)” above. The Company’s contributions to the plan are included under “All Other Compensation Column” and noted hereafter. | ||
(6) | All other compensation for Mr. Elop in 2010 includes: EUR 2 292 702 one time payment as compensation for lost income from his prior employer which resulted due to his move to Nokia; EUR 509 744 one-time payment to reimburse him for fees he was obligated to repay his former employer; EUR 312 203 income resulting from legal expenses paid by Nokia associated with his move to Nokia, including tax assistance; EUR 627 for taxable benefit for premiums paid under supplemental medical and disability insurance, for driver and for mobile phone. | |
(7) | Mr. Kallasvuo’s proportionate change in the liability related to the individual under the funded part of the Finnish TyEL pension was negative (see footnote 5 above). In addition, it includes a negative change in the annual pension liability of EUR 9 590 000, relating to the cancellation of the early retirement benefit at the age of 60 provided under his service contract, which has been forfeited upon end of employment. As a result of the cancellation of this early retirement benefit, Nokia reversed the actuarial liability of EUR 10 154 000. | |
(8) | All other compensation for Mr. Kallasvuo in 2010 includes: EUR 4 623 750 as severance payment as describe under his service agreement, see ‘‘—Actual Executive Compensation for 2010—Service Contracts ‘‘above; EUR 748 000 as compensation for the fair market value of the 100 000 Nokia restricted shares granted to him in 2007, which were to vest on October 1, 2010; EUR 130 000 for his services as member of the Board or Directors, see ‘‘—Board of Directors—Remuneration of the Board of Directors in 2010” above; EUR 15 427 for car allowance; EUR 6 088 for driver and for mobile phone; EUR 796 for taxable benefit for premiums paid under supplemental medical and disability insurance. | |
(9) | All other compensation for Mr. Ihamuotila in 2010 includes: EUR 7 440 for car allowance; EUR 1 453 taxable benefit for premiums paid under supplemental medical and disability insurance and for mobile phone. | |
(10) | Salaries, benefits and perquisites for Ms. McDowell and Mr. Simonson are paid and denominated in USD. Amounts were converted to euro using year-end 2010 USD/EUR exchange rate of 1.32 and GPB/EUR rate of 0.85. For year 2009 disclosure, amounts were converted to euro using year-end 2009 USD/EUR exchange rate of 1.43. For year 2008 disclosure, amounts were converted to euro using year-end 2008 USD/EUR exchange rate of 1.40. | |
(11) | All other compensation for Ms. McDowell in 2010 includes: EUR 45 951 provided under Nokia’s international assignment policy in the U.K; EUR 12 935 for car allowance, EUR 12 500 company contributions to the 401(k) Plan. | |
(12) | Mr. Öistämö’s and Mr. Savander’s proportionate change in the liability related to the individual under the funded part of the Finnish TyEL pension was negative (see footnote 5 above). | |
(13) | All other compensation for Mr. Öistämö in 2010 includes: EUR 16 925 for car allowance; EUR 1 440 as taxable benefit for premiums paid under supplemental medical and disability insurance, for mobile phone and driver benefit. | |
(14) | All other compensation for Mr. Savander in 2010 includes: EUR 22 200 for car allowance; EUR 1 434 as taxable benefit for premiums paid under supplemental medical and disability insurance and for mobile phone. | |
(15) | All other compensation for Mr. Simonson in 2010 includes: EUR 55 514 company contributions to the Restoration & Deferral plan; EUR 12 500 company contributions to the 401(k) plan; EUR 9 906 for car allowance. |
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(*) | None of the named executive officers participated in a formulated, non-discretionary, incentive plan. Annual incentive payments are included under the “Bonus” column. |
Option Awards | Stock Awards | |||||||||||||||||||||||||||||||||||
Number of | Performance | Performance | ||||||||||||||||||||||||||||||||||
Shares | Grant | Grant Date | Shares at | Shares at | Restricted | Grant Date | ||||||||||||||||||||||||||||||
Name and Principal | Grant | underlying | Price | Fair Value(2) | Threshold | Maximum | Shares | Fair Value(3) | ||||||||||||||||||||||||||||
Position | Year | Date | Options | (EUR) | (EUR) | (Number) | (Number) | (Number) | (EUR) | |||||||||||||||||||||||||||
Stephen Elop, President and CEO | 2010 | Nov. 5 | 500 000 | 7.59 | 800 132 | 75 000 | 300 000 | 100 000 | 1 682 607 | |||||||||||||||||||||||||||
Olli-Pekka Kallasvuo, President and CEO until September 20, 2010(4) | 2010 | May 7 | 270 000 | 8.86 | 641 551 | 135 000 | 540 000 | 170 000 | 3 267 288 | |||||||||||||||||||||||||||
Timo Ihamuotila, EVP, Chief Financial Officer | 2010 | May 7 | 70 000 | 8.86 | 166 328 | 35 000 | 140 000 | 120 000 | 1 341 568 | |||||||||||||||||||||||||||
Mary T. McDowell, EVP, Mobile Phones | 2010 | May 7 | 60 000 | 8.86 | 142 567 | 30 000 | 120 000 | 115 000 | 1 233 368 | |||||||||||||||||||||||||||
Kai Öistämö, EVP, Chief Development Officer | 2010 | May 7 | 70 000 | 8.86 | 166 328 | 35 000 | 140 000 | 100 000 | 1 212 143 | |||||||||||||||||||||||||||
Niklas Savander, EVP, Markets | 2010 | May 7 | 60 000 | 8.86 | 142 567 | 30 000 | 120 000 | 115 000 | 1 233 368 | |||||||||||||||||||||||||||
Richard Simonson, EVP, Mobile Phones until June 30, 2010(4) | 2010 | May 7 | 70 000 | 8.86 | 166 328 | 35 000 | 140 000 | 111 000 | 1 508 474 |
(1) | Including all equity awards made during 2010. Awards were made under the Nokia Stock Option Plan 2007, the Nokia Performance Share Plan 2010 and the Nokia Restricted Share Plan 2010. | |
(2) | The fair value of stock options equals the estimated fair value on the grant date, calculated using the Black-Scholes model. The stock option exercise price was EUR 8.86 on May 7, 2010 and EUR 7.59 on November 5, 2010. NASDAQ OMX Helsinki closing market price at grant date on May 7, 2010 was EUR 8.35 and on November 5, 2010 was EUR 7.65. | |
(3) | The fair value of performance shares and restricted shares equals the estimated fair value on the grant date. The estimated fair value is based on the grant date market price of the Nokia share less the present value of dividends expected to be paid during the vesting period. The value of performance shares is presented on the basis of a number of shares, which is two times the number at threshold. | |
(4) | Mr. Kallasvuo’s and Mr. Simonson’s equity grants were forfeited and cancelled following end of employment in accordance with the plan rules. |
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Performance | ||||||||
Plan | period | Settlement | ||||||
2007(1) | 2007-2009 | 2010 | ||||||
2008(1) | 2008-2010 | 2011 | ||||||
2009 | 2009-2011 | 2012 | ||||||
2010 | 2010-2012 | 2013 |
(1) | No Nokia shares were delivered under Nokia Performance Share Plans 2007 and 2008 as Nokia’s performance did not reach the threshold level of either performance criteria under both plans. |
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Maximum Number of Shares Available for Grants | ||||
under the Equity Based Compensation Program | ||||
Plan type | in 2011 | |||
Stock Options | 12 million | |||
Restricted Shares | 9 million | |||
Performance Shares at Maximum(1) | 28 million |
(1) | The number of Nokia shares to be delivered at threshold performance is a quarter of maximum performance, i.e., a total of 7 million Nokia shares. |
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Board meetings | Committee meetings | |||||||
Georg Ehrnrooth (until May 6, 2010) | 100 | % | 100 | % | ||||
Lalita Gupte | 93 | % | 100 | % | ||||
Bengt Holmström | 93 | % | N/A | |||||
Henning Kagermann | 100 | % | 100 | % | ||||
Olli-Pekka Kallasvuo (until Sep 10, 2010) | 100 | %(1) | N/A | |||||
Per Karlsson | 85 | % | 100 | % | ||||
Isabel Marey-Semper | 85 | % | 100 | % | ||||
Jorma Ollila | 100 | % | N/A | |||||
Marjorie Scardino | 100 | % | 100 | % | ||||
Risto Siilasmaa | 100 | % | 100 | % | ||||
Keijo Suila | 100 | % | 100 | % |
(1) | Excluding meetings which he was excused by law. |
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2010 | 2009 | 2008 | ||||||||||
Devices & Services | 58 642 | 56 462 | 57 443 | |||||||||
NAVTEQ(1) | 5 020 | 4 282 | 3 969 | |||||||||
Nokia Siemens Networks | 65 379 | 62 129 | 59 965 | |||||||||
Corporate Common Functions | 314 | 298 | 346 | |||||||||
Nokia Group | 129 355 | 123 171 | 121 723 | |||||||||
Finland | 20 956 | 22 823 | 23 478 | |||||||||
Other European countries | 35 175 | 37 045 | 37 714 | |||||||||
Middle-East & Africa | 4 628 | 4 177 | 5 032 | |||||||||
China | 18 923 | 15 026 | 14 099 | |||||||||
Asia-Pacific | 26 976 | 22 748 | 20 359 | |||||||||
North America | 8 128 | 8 236 | 8 427 | |||||||||
Latin America | 14 569 | 13 116 | 12 614 | |||||||||
Nokia Group | 129 355 | 123 171 | 121 723 | |||||||||
(1) | Nokia completed the acquisition of NAVTEQ Corporation on July 10, 2008. Accordingly, the average number of NAVTEQ personnel in 2008 is for the period from July 10, 2008 to December 31, 2008. |
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Name(1) | Shares(2) | ADSs(2) | ||||||
Jorma Ollila(3) | 761 680 | — | ||||||
Marjorie Scardino | — | 33 208 | ||||||
Lalita D. Gupte | — | 17 910 | ||||||
Bengt Holmström | 33 235 | — | ||||||
Henning Kagermann | 16 629 | — | ||||||
Per Karlsson(4) | 39 367 | — | ||||||
Isabel Marey-Semper | 11 861 | — | ||||||
Risto Siilasmaa | 55 589 | — | ||||||
Keijo Suila | 19 632 | — |
(1) | Georg Ehrnrooth did not stand for re-election in the Annual General Meeting held on May 6, 2010 and he held 327 531 shares at that time, including both shares held personally and shares held through a company. Olli-Pekka Kallasvuo left the Board of Directors on September 10, 2010 and he held 389 672 shares at that time. | |
(2) | The number of shares or ADSs includes not only shares or ADSs received as director compensation, but also shares or ADSs acquired by any other means. Stock options or other equity awards that are deemed as being beneficially owned under the applicable SEC rules are not included. | |
(3) | For Jorma Ollila, this table includes his share ownership only. Mr. Ollila was entitled to retain all vested and unvested stock options, performance shares and restricted shares granted to him in respect of his service as the CEO of Nokia prior to June 1, 2006 as approved by the Board of Directors. Therefore, in addition to the above-presented share ownership, Mr. Ollila held, as at December 31, 2010, a total of 400 000 stock options. The information relating to stock options held by Mr. Ollila as at December 31, 2010 is presented in the table below. |
Total Intrinsic Value of | ||||||||||||||||||||||||||
Exercise | Stock Options, | |||||||||||||||||||||||||
Price per | December 30, 2010 | |||||||||||||||||||||||||
Stock Option | Share | Number of Stock Options | (EUR) | |||||||||||||||||||||||
Category | Expiration Date | (EUR) | Exercisable | Unexercisable | Exercisable | Unexercisable | ||||||||||||||||||||
2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | ||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 400 000 | 0 | 0 | 0 |
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The number of stock options in the above table equals the number of underlying shares represented by the option entitlement. The intrinsic value of the stock options in the above table is based on the difference between the exercise price of the options and the closing market price of Nokia shares on NASDAQ OMX Helsinki as at December 30, 2010 of EUR 7.74. | ||
(4) | Per Karlsson’s holdings include both shares held personally and shares held through a company. |
Shares | Shares | |||||||||||||||||||
Receivable | Receivable | Shares | ||||||||||||||||||
Shares | Through | Through | Receivable | |||||||||||||||||
Receivable | Performance | Performance | Through | |||||||||||||||||
Through Stock | Shares at | Shares at | Restricted | |||||||||||||||||
Shares | Options | Threshold(4) | Maximum(5) | Shares | ||||||||||||||||
Number of equity instruments held by Group Executive Board(1) | 524 202 | 1 943 975 | 443 500 | 1 774 000 | 1 174 000 | |||||||||||||||
% of the outstanding shares(2) | 0.014 | 0.052 | 0.012 | 0.048 | 0.032 | |||||||||||||||
% of the total outstanding equity incentives (per instrument)(3) | 8.94 | 7.75 | 7.75 | 9.50 |
(1) | Includes nine Group Executive Board members at year end. Figures do not include those former Group Executive Board members who left during 2010. | |
(2) | The percentage is calculated in relation to the outstanding number of shares and total voting rights of the company, excluding shares held by Nokia Group. | |
(3) | The percentage is calculated in relation to the total outstanding equity incentives per instrument, i.e., stock options, performance shares and restricted shares, as applicable, under the global equity plans. | |
(4) | No Nokia shares were delivered under Nokia Performance Share Plan 2008 which vested in 2010 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the shares deliverable at threshold equals zero for the Performance Share Plan 2008. | |
(5) | No Nokia shares were delivered under Nokia Performance Share Plan 2008 which vested in 2010 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the shares deliverable at maximum equals zero for Nokia Performance Share Plan 2008. At maximum performance under the Performance Share Plan 2009 and 2010, the number of shares deliverable equals four times the number of performance shares at threshold. |
Name | Shares(1) | ADSs(1) | ||||||
Stephen Elop | — | — | ||||||
Esko Aho | — | — | ||||||
Timo Ihamuotila | 56 213 | — | ||||||
Mary T. McDowell | 169 219 | 5 000 | ||||||
Tero Ojanperä | 66 872 | — | ||||||
Niklas Savander | 83 465 | — | ||||||
Alberto Torres | 42 832 | — | ||||||
Juha Äkräs | 15 976 | — | ||||||
Kai Öistämö | 84 625 | — |
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(1) | Stock options or other equity awards that are deemed as being beneficially owned under applicable SEC rules are not included. |
Exercise | Total Intrinsic Value of | |||||||||||||||||||||||||||
Price | Stock Options, | |||||||||||||||||||||||||||
per | December 31, 2010 | |||||||||||||||||||||||||||
Stock Option | Expiration | Share | Number of Stock Options(1) | (EUR)(2) | ||||||||||||||||||||||||
Name | Category | Date | (EUR) | Exercisable | Unexercisable | Exercisable(3) | Unexercisable | |||||||||||||||||||||
Stephen Elop | 2010 4Q | December 31, 2015 | 7.59 | 0 | 500 000 | 0 | 75 000 | |||||||||||||||||||||
Esko Aho | 2009 2Q | December 31, 2014 | 11.18 | 10 937 | 24 063 | 0 | 0 | |||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 30 000 | 0 | 0 | ||||||||||||||||||||||
Timo Ihamuotila | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 9 900 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 26 000 | 6 000 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 11 250 | 8 750 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 10 937 | 24 063 | 0 | 0 | ||||||||||||||||||||||
2009 4Q | December 31, 2014 | 8.76 | 0 | 20 000 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 70 000 | 0 | 0 | ||||||||||||||||||||||
Mary T. McDowell | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 100 000 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 44 683 | 10 317 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 15 750 | 12 250 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 17 187 | 37 813 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 60 000 | 0 | 0 | ||||||||||||||||||||||
Tero Ojanperä | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 60 000 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 26 000 | 6 000 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 11 250 | 8 750 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 10 937 | 24 063 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 40 000 | 0 | 0 | ||||||||||||||||||||||
Niklas Savander | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 45 000 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 26 000 | 6 000 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 15 750 | 12 250 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 17 187 | 37 813 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 60 000 | 0 | 0 | ||||||||||||||||||||||
Alberto Torres(4) | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 7 200 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 14 625 | 3 375 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 5 625 | 4 375 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 6 250 | 13 750 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 40 000 | 0 | 0 | ||||||||||||||||||||||
Juha Äkräs | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 6 875 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 8 125 | 1 875 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 3 375 | 2 625 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 3 750 | 8 250 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 40 000 | 0 | 0 | ||||||||||||||||||||||
Kai Öistämö | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2005 4Q | December 31, 2010 | 14.48 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 100 000 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 44 683 | 10 317 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 18 000 | 14 000 | 0 | 0 |
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Exercise | Total Intrinsic Value of | |||||||||||||||||||||||||||
Price | Stock Options, | |||||||||||||||||||||||||||
per | December 31, 2010 | |||||||||||||||||||||||||||
Stock Option | Expiration | Share | Number of Stock Options(1) | (EUR)(2) | ||||||||||||||||||||||||
Name | Category | Date | (EUR) | Exercisable | Unexercisable | Exercisable(3) | Unexercisable | |||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 18 750 | 41 250 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 70 000 | 0 | 0 | ||||||||||||||||||||||
Stock options held by the members of the Group Executive Board as at December 31, 2010. | ||||||||||||||||||||||||||||
Total(5) | 696 026 | 1 247 949 | 0 | 75 000 | ||||||||||||||||||||||||
All outstanding stock option plans (global plans), Total | 11 712 432 | 10 031 167 | 0 | 147 096 |
(1) | Number of stock options equals the number of underlying shares represented by the option entitlement. Stock options vest over four years: 25% after one year and 6.25% each quarter thereafter. | |
(2) | The intrinsic value of the stock options is based on the difference between the exercise price of the options and the closing market price of Nokia shares on NASDAQ OMX Helsinki as at December 30, 2010 of EUR 7.74. | |
(3) | For gains realized upon exercise of stock options for the members of the Group Executive Board, see the table in “— Stock Option Exercises and Settlement of Shares” below. | |
(4) | Mr. Torres’s termination date under the employment agreement is March 31, 2011. His equity will forfeit following termination of employment in accordance with the plan rules. | |
(5) | During 2010, the following executives stepped down from the Group Executive Board: Olli-Pekka Kallasvuo, Richard Simonson, Anssi Vanjoki and Hallstein Moerk. The information related to stock options held for each former executive is as of the date of resignation from the Group Executive Board and is presented in the table below. |
Exercise | Total Intrinsic Value of | |||||||||||||||||||||||||||
Price | Stock Options, | |||||||||||||||||||||||||||
Stock Option | Expiration | Share | Number of Stock Options(1) | (EUR)(9) | ||||||||||||||||||||||||
Name | Category | Date | (EUR) | Exercisable | Unexercisable | Exercisable(3) | Unexercisable | |||||||||||||||||||||
Olli-Pekka Kallasvuo(6) as per September 20, 2010 | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2005 4Q | December 31, 2010 | 14.48 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 300 000 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 120 000 | 40 000 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 57 498 | 57 502 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 58 750 | 176 250 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 270 000 | 0 | 0 | ||||||||||||||||||||||
Richard Simonson(6) as per June 30, 2010 | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 93 750 | 6 250 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 37 809 | 17 191 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 14 000 | 18 000 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 0 | 60 000 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 70 000 | 0 | 0 | ||||||||||||||||||||||
Anssi Vanjoki(7)as per October 12, 2010 | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 68 750 | 0 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 44 683 | 10 317 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 18 000 | 14 000 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 18 750 | 41 250 | 0 | 0 | ||||||||||||||||||||||
2010 2Q | December 31, 2015 | 8.86 | 0 | 70 000 | 0 | 0 | ||||||||||||||||||||||
Hallstein Moerk(8) as per March 31, 2010 | 2005 2Q | December 31, 2010 | 12.79 | 0 | 0 | 0 | 0 | |||||||||||||||||||||
2006 2Q | December 31, 2011 | 18.02 | 52 500 | 7 500 | 0 | 0 | ||||||||||||||||||||||
2007 2Q | December 31, 2012 | 18.39 | 20 000 | 12 000 | 0 | 0 | ||||||||||||||||||||||
2008 2Q | December 31, 2013 | 19.16 | 7 500 | 12 500 | 0 | 0 | ||||||||||||||||||||||
2009 2Q | December 31, 2014 | 11.18 | 0 | 35 000 | 0 | 12 250 |
(6) | Mr. Kallasvuo’s and Mr. Simonson’s stock option grants were forfeited following termination of employment in accordance with the plan rules. | |
(7) | Mr. Vanjoki’s termination date under the employment agreement is March 11, 2011. His equity will forfeit following termination of employment in accordance with the plan rules. | |
(8) | Mr. Moerk retained his vested and unvested stock option grants upon retirement, in accordance with the plan provisions. | |
(9) | The intrinsic value of the stock options is based on the difference between the exercise price of the options and the closing market price of Nokia shares on NASDAQ OMX Helsinki as at March 31, 2010 of EUR 11.53 in respect of Mr. Moerk, as at June 30, 2010 of EUR 6.71 in respect of |
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Mr. Simonson, as at September 20, 2010 of EUR 7.87 in respect of Mr. Kallasvuo and as at October 12, 2010 of EUR 7.86 in respect of Mr. Vanjoki. |
Performance Shares | Restricted Shares | |||||||||||||||||||||||||||
Number of | Number of | |||||||||||||||||||||||||||
Performance | Performance | Intrinsic Value | Number of | Intrinsic Value | ||||||||||||||||||||||||
Shares at | Shares at | December 31, | Plan | Restricted | December 31, | |||||||||||||||||||||||
Name | Plan Name(1) | Threshold(2) | Maximum(3) | 2010(4) (EUR) | Name(5) | Shares | 2010(6) (EUR) | |||||||||||||||||||||
Stephen Elop | 2010 | 75 000 | 300 000 | 1 161 000 | 2010 | 100 000 | 774 000 | |||||||||||||||||||||
Esko Aho | 2008 | — | — | — | 2008 | 7 000 | 54 180 | |||||||||||||||||||||
2009 | 17 500 | 70 000 | 102 224 | 2009 | 25 000 | 193 500 | ||||||||||||||||||||||
2010 | 15 000 | 60 000 | 232 200 | 2010 | 58 000 | 448 920 | ||||||||||||||||||||||
Timo Ihamuotila | 2008 | 0 | 0 | 0 | 2008 | 14 000 | 108 360 | |||||||||||||||||||||
2009 | 27 500 | 110 000 | 160 638 | 2009 | 35 000 | 270 900 | ||||||||||||||||||||||
2010 | 35 000 | 140 000 | 541 800 | 2010 | 120 000 | 928 800 | ||||||||||||||||||||||
Mary T. McDowell | 2008 | 0 | 0 | 0 | 2008 | 20 000 | 154 800 | |||||||||||||||||||||
2009 | 27 500 | 110 000 | 160 638 | 2009 | 38 000 | 294 120 | ||||||||||||||||||||||
2010 | 30 000 | 120 000 | 464 400 | 2010 | 115 000 | 890 100 | ||||||||||||||||||||||
Tero Ojanperä | 2008 | 0 | 0 | 0 | 2008 | 14 000 | 108 360 | |||||||||||||||||||||
2009 | 17 500 | 70 000 | 102 224 | 2009 | 25 000 | 193 500 | ||||||||||||||||||||||
2010 | 20 000 | 80 000 | 309 600 | 2010 | 85 000 | 657 900 | ||||||||||||||||||||||
Niklas Savander | 2008 | 0 | 0 | 0 | 2008 | 20 000 | 154 800 | |||||||||||||||||||||
2009 | 27 500 | 110 000 | 160 638 | 2009 | 38 000 | 294 120 | ||||||||||||||||||||||
2010 | 30 000 | 120 000 | 464 400 | 2010 | 115 000 | 890 100 | ||||||||||||||||||||||
Alberto Torres(7) | 2008 | 0 | 0 | 0 | 2007 | 13 000 | 100 620 | |||||||||||||||||||||
2009 | 10 000 | 40 000 | 58 414 | 2008 | 10 000 | 77 400 | ||||||||||||||||||||||
2010 | 20 000 | 80 000 | 309 600 | 2009 | 25 000 | 193 500 | ||||||||||||||||||||||
2010 | 30 000 | 232 200 | ||||||||||||||||||||||||||
Juha Äkräs | 2008 | 0 | 0 | 0 | 2007 | 4 000 | 30 960 | |||||||||||||||||||||
2009 | 6 000 | 24 000 | 35 048 | 2008 | 8 000 | 61 920 | ||||||||||||||||||||||
2010 | 20 000 | 80 000 | 309 600 | 2009 | 15 000 | 116 100 | ||||||||||||||||||||||
2010 | 85 000 | 657 900 | ||||||||||||||||||||||||||
Kai Öistämö | 2008 | 0 | 0 | 0 | 2008 | 22 000 | 170 280 | |||||||||||||||||||||
2009 | 30 000 | 120 000 | 175 241 | 2009 | 50 000 | 387 000 | ||||||||||||||||||||||
2010 | 35 000 | 140 000 | 541 800 | 2010 | 100 000 | 774 000 | ||||||||||||||||||||||
Performance shares and restricted shares held by the Group Executive Board, Total(8) | 443 500 | 1 774 000 | 5 289 465 | 1 191 000 | 9 218 340 | |||||||||||||||||||||||
All outstanding performance shares and restricted shares (global plans), Total | 5 720 123(13 | ) | 22 880 492(14 | ) | 64 755 163 | 12 359 896 | 95 665 595 |
(1) | The performance period for the 2008 plan is2008-2010, for the 2009 plan2009-2011 and for the 2010 plan2010-2012, respectively. | |
(2) | The threshold number will vest as Nokia shares should the pre-determined threshold performance levels be met of both performance criteria. No Nokia shares were delivered under the Performance Share Plan 2008 which would have vested in 2010 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the shares deliverable at threshold equals zero for the Performance Share Plan 2008. | |
(3) | The maximum number will vest as Nokia shares should the pre-determined maximum performance levels be met of both performance criteria. The maximum number of performance shares equals four times the number at threshold. No Nokia shares were delivered under the |
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Performance Share Plan 2008 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the shares deliverable at maximum equals zero for the Performance Share Plan 2008. | ||
(4) | For Performance Share Plans 2009 and 2010 the value of performance shares is presented on the basis of Nokia’s estimation of the number of shares expected to vest. The intrinsic value for the Performance Share Plans 2009 and 2010 is based on the closing market price of a Nokia share on NASDAQ OMX Helsinki as at December 30, 2010 of EUR 7.74. For the Performance Share Plan 2008 no Nokia shares were delivered as Nokia’s performance did not reach the threshold level of either performance criteria. | |
(5) | Under the Restricted Share Plans 2007, 2008, 2009 and 2010, awards have been granted quarterly. For the major part of the awards made under these plans, the restriction period will end for the 2007 plan, on January 1, 2011; for the 2008 plan, on January 1, 2012; for the 2009 plan, on January 1, 2013; and for the 2010 plan, on January 1, 2014. | |
(6) | The intrinsic value is based on the closing market price of a Nokia share on NASDAQ OMX Helsinki as at December 30, 2010 of EUR 7.74. | |
(7) | Mr. Torres’s termination date under the employment agreement is March 31, 2011. His equity will forfeit following termination of employment in accordance with the plan rules. | |
(8) | During 2010, the following executives stepped down from the Group Executive Board: Olli-Pekka Kallasvuo, Richard Simonson, Hallstein Moerk and Anssi Vanjoki. The information related to performance shares and restricted shares held by each of the former executives is as of the date of resignation from the Group Executive Board and is presented in the table below. |
Performance Shares | Restricted Shares | |||||||||||||||||||||||||||
Number of | Number of | |||||||||||||||||||||||||||
Performance | Performance | Intrinsic | Number of | Intrinsic | ||||||||||||||||||||||||
Plan | Shares at | Shares at | Value | Plan | Restricted | Value | ||||||||||||||||||||||
Name | Name(1) | Threshold(13) | Maximum(14) | (EUR)(12) | Name(5) | Shares | (EUR)(12) | |||||||||||||||||||||
Olli-Pekka Kallasvuo(9) as per September 20, 2010 | 2008 | 0 | 0 | 0 | 2007 | 100 000 | 787 000 | |||||||||||||||||||||
2009 | 117 500 | 470 000 | 697 890 | 2008 | 75 000 | 590 250 | ||||||||||||||||||||||
2010 | 135 000 | 540 000 | 2 124 900 | 2009 | 150 000 | 1 180 500 | ||||||||||||||||||||||
2010 | 170 000 | 1 337 900 | ||||||||||||||||||||||||||
Richard Simonson(9) as per June 30, 2010 | 2008 | 0 | 0 | 0 | 2007 | 35 000 | 234 850 | |||||||||||||||||||||
2009 | 30 000 | 120 000 | 151 921 | 2008 | 22 000 | 147 620 | ||||||||||||||||||||||
2010 | 35 000 | 140 000 | 469 700 | 2009 | 107 000 | 717 970 | ||||||||||||||||||||||
2010 | 111 000 | 744 810 | ||||||||||||||||||||||||||
Anssi Vanjoki(10) as per October 12, 2010 | 2008 | 0 | 0 | 0 | 2007 | 35 000 | 275 100 | |||||||||||||||||||||
2009 | 30 000 | 120 000 | 177 958 | 2008 | 22 000 | 172 920 | ||||||||||||||||||||||
2010 | 35 000 | 140 000 | 550 200 | 2009 | 40 000 | 314 400 | ||||||||||||||||||||||
2010 | 45 000 | 353 700 | ||||||||||||||||||||||||||
Hallstein Moerk(11) as per March 31, 2010 | 2008 | 0 | 0 | 0 | 2007 | 25 000 | 288 250 | |||||||||||||||||||||
2009 | 17 500 | 70 000 | 152 280 | 2008 | 14 000 | 161 420 | ||||||||||||||||||||||
2009 | 25 000 | 288 250 |
(9) | Mr. Kallasvuo’s and Mr. Simonson’s performance and restricted share grants were forfeited following termination of employment in accordance with the plan rules. | |
(10) | Mr. Vanjoki’s termination date under the employment agreement is March 11, 2011. His equity will forfeit following termination of employment in accordance with the plan rules. | |
(11) | Mr. Moerk retained his performance and restricted share grants upon retirement, in accordance with the equity plan provisions. | |
(12) | The intrinsic value is based on the closing market price of a Nokia share on NASDAQ OMX Helsinki as at March 31, 2010 of EUR 11.53 in respect of Mr. Moerk, as at June 30, 2010 of EUR 6.71 in respect of Mr. Simonson, as at September 20, 2010 of EUR 7.87 in respect of Mr. Kallasvuo and as at October 12, 2010 of EUR 7.86 in respect of Mr. Vanjoki. |
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(13) | The threshold number will vest as Nokia shares should the pre-determined threshold performance levels to be met for both performance criteria. No Nokia shares were delivered under the Performance Share Plan 2008 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the aggregate number does not include any shares for Performance Share Plan 2008. | |
(14) | The maximum number will vest as Nokia shares should the pre-determined maximum performance levels be met. The maximum number of performance shares equals four times the number at threshold. No Nokia shares were delivered under the Performance Share Plan 2008 as Nokia’s performance did not reach the threshold level of either performance criteria. Therefore the aggregate number does not include any shares for Performance Share Plan 2008. |
Stock Options | ||||||||||||||||||||||||
Awards(1) | Performance Shares Awards(2) | Restricted Shares Awards(3) | ||||||||||||||||||||||
Number of | Value | Number of | Value | Number of | Value | |||||||||||||||||||
Shares | Realized on | Shares | Realized | Shares | Realized on | |||||||||||||||||||
Acquired on | Exercise | Delivered on | on | Delivered on | Vesting | |||||||||||||||||||
Name(4) | Exercise | (EUR) | Vesting | Vesting (EUR) | Vesting | (EUR) | ||||||||||||||||||
Stephen Elop | 0 | 0.00 | 0 | 0.00 | 0 | 0 | ||||||||||||||||||
Esko Aho | 0 | 0.00 | 0 | 0.00 | 0 | 0 | ||||||||||||||||||
Timo Ihamuotila | 0 | 0.00 | 0 | 0.00 | 25 000 | 196 500 | ||||||||||||||||||
Mary T. McDowell | 0 | 0.00 | 0 | 0.00 | 35 000 | 275 100 | ||||||||||||||||||
Tero Ojanperä | 0 | 0.00 | 0 | 0.00 | 25 000 | 196 500 | ||||||||||||||||||
Niklas Savander | 0 | 0.00 | 0 | 0.00 | 25 000 | 196 500 | ||||||||||||||||||
Alberto Torres | 0 | 0.00 | 0 | 0.00 | 0 | 0 | ||||||||||||||||||
Juha Äkräs | 0 | 0.00 | 0 | 0.00 | 0 | 0 | ||||||||||||||||||
Kai Öistämö | 0 | 0.00 | 0 | 0.00 | 35 000 | 275 100 |
(1) | Value realized on exercise is based on the difference between the Nokia share price and exercise price of options. | |
(2) | No Nokia shares were delivered under the Performance Share Plan 2007 during 2010 as Nokia’s performance did not reach the threshold level of either performance criteria. | |
(3) | Delivery of Nokia shares vested from the Restricted Share Plan 2007. Value is based on the closing market price of the Nokia share on NASDAQ OMX Helsinki on October 27, 2010 of EUR 7.86. | |
(4) | During 2010, the following executives stepped down from the Group Executive Board: Olli-Pekka Kallasvuo, Richard Simonson, Hallstein Moerk and Anssi Vanjoki. The information regarding stock option exercises and settlement of shares regarding each of the former executives is as of the date of resignation from the Group Executive Board and is represented in the table below. |
Stock Options | ||||||||||||||||||||||||||||
Awards(1) | Performance Shares Awards(2) | Restricted Shares Awards(3) | ||||||||||||||||||||||||||
Number of | Value | Number of | Value | Number of | Value | |||||||||||||||||||||||
Shares | Realized on | Shares | Realized | Shares | Realized on | |||||||||||||||||||||||
Acquired on | Exercise | Delivered on | on | Delivered on | Vesting | |||||||||||||||||||||||
Name | Year | Exercise | (EUR) | Vesting | Vesting (EUR) | Vesting | (EUR) | |||||||||||||||||||||
Olli-Pekka Kallasvuo as per September 20, 2010 | 2010 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | |||||||||||||||||||||
Richard Simonson as per June 30, 2010 | 2010 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 | |||||||||||||||||||||
Anssi Vanjoki as per October 12, 2010 | 2010 | 0 | 0.00 | 0 | 0.00 | 35 000 | 275 100 | |||||||||||||||||||||
Hallstein Moerk as per March 31, 2010 | 2010 | 0 | 0.00 | 0 | 0.00 | 0 | 0.00 |
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ITEM 7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS |
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ITEM 8. | FINANCIAL INFORMATION |
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ITEM 9. | THE OFFER AND LISTING |
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NASDAQ | New York | |||||||||||||||
OMX | Stock | |||||||||||||||
Helsinki | Exchange | |||||||||||||||
Price per share | Price per ADS | |||||||||||||||
High | Low | High | Low | |||||||||||||
(EUR) | (USD) | |||||||||||||||
2006 | 18.65 | 14.61 | 23.10 | 17.72 | ||||||||||||
2007 | 28.60 | 14.63 | 41.10 | 19.08 | ||||||||||||
2008 | 25.78 | 9.95 | 38.25 | 12.35 | ||||||||||||
2009 | ||||||||||||||||
First Quarter | 12.25 | 6.67 | 16.38 | 8.47 | ||||||||||||
Second Quarter | 11.88 | 8.57 | 16.58 | 11.46 | ||||||||||||
Third Quarter | 11.25 | 8.45 | 16.00 | 12.10 | ||||||||||||
Fourth Quarter | 10.68 | 8.41 | 15.60 | 12.14 | ||||||||||||
Full Year | 12.25 | 6.67 | 16.58 | 8.47 | ||||||||||||
2010 | ||||||||||||||||
First Quarter | 11.71 | 8.79 | 15.65 | 12.52 | ||||||||||||
Second Quarter | 11.82 | 6.61 | 15.89 | 8.00 | ||||||||||||
Third Quarter | 8.28 | 6.59 | 10.29 | 8.21 | ||||||||||||
Fourth Quarter | 8.42 | 7.01 | 11.62 | 9.08 | ||||||||||||
Full Year | 11.82 | 6.59 | 15.89 | 8.00 | ||||||||||||
Most recent six months | ||||||||||||||||
September 2010 | 8.28 | 6.75 | 10.29 | 8.76 | ||||||||||||
October 2010 | 8.42 | 7.31 | 11.62 | 9.98 | ||||||||||||
November 2010 | 7.90 | 7.01 | 10.88 | 9.08 | ||||||||||||
December 2010 | 7.97 | 7.17 | 10.39 | 9.49 | ||||||||||||
January 2011 | 8.33 | 7.12 | 11.02 | 10.20 | ||||||||||||
February 2011 | 8.49 | 6.14 | 11.75 | 8.44 |
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ITEM 10. | ADDITIONAL INFORMATION |
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ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
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ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES |
Service | Fees (USD) | |
Issuance of ADSs | Up to 5 cents per ADS(1) | |
Cancellation of ADSs | Up to 5 cents per ADS(1) | |
Distribution of cash dividends or other cash distributions | Up to 2 cents per ADS(2) | |
Distribution of ADSs pursuant to (i) stock dividends, free stock distributions or (ii) exercises of rights to purchase additional ADSs | Up to 5 cents per ADS(2) | |
Distribution of securities other than ADSs or rights to purchase additional ADSs | Up to 5 cents per ADS(1) | |
ADR transfer fee | USD 1.50 per transfer(1) |
(1) | These fees are typically paid to the Depositary by the brokers on behalf of their clients receiving the newly-issued ADSs from the Depositary and by the brokers on behalf of their clients delivering the ADSs to the Depositary for cancellation. The brokers in turn charge these transaction fees to their clients. | |
(2) | In practice, the Depositary has not collected these fees. If collected, such fees are offset against the related distribution made to the ADR holder. |
Category | Payment (USD) | |||
New York Stock Exchange listing fees | 500 000 | |||
Settlement infrastructure fees (including the Depositary Trust Company fees) | 50 226 | |||
Proxy process expenses (including printing, postage and distribution) | 904 787 | |||
ADS holder identification expenses | 90 524 | |||
Total | 1 545 537 | |||
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ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES |
ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS |
ITEM 15. | CONTROLS AND PROCEDURES |
ITEM 16A. | AUDIT COMMITTEE FINANCIAL EXPERT |
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ITEM 16B. | CODE OF ETHICS |
ITEM 16C. | PRINCIPAL ACCOUNTANT FEES AND SERVICES |
2010 | 2009 | |||||||||||||||||||||||
Nokia Siemens | Nokia Siemens | |||||||||||||||||||||||
Nokia | Networks | Total | Nokia | Networks | Total | |||||||||||||||||||
(EUR millions) | ||||||||||||||||||||||||
Audit Fees(1) | 6.8 | 9.6 | 16.4 | 6.2 | 9.8 | 16.0 | ||||||||||||||||||
Audit-Related Fees(2) | 1.3 | 1.2 | 2.5 | 1.2 | 1.6 | 2.8 | ||||||||||||||||||
Tax Fees(3) | 4.4 | 1.2 | 5.6 | 3.6 | 2.0 | 5.6 | ||||||||||||||||||
All Other Fees(4) | 0.1 | �� | — | 0.1 | 0.3 | — | 0.3 | |||||||||||||||||
Total | 12.6 | 12.0 | 24.6 | 11.3 | 13.4 | 24.7 | ||||||||||||||||||
(1) | Audit Fees consist of fees billed for the annual audit of the company’s consolidated financial statements and the statutory financial statements of the company’s subsidiaries. They also include fees billed for other audit services, which are those services that only the independent auditor reasonably can provide, and include the provision of comfort letters and consents in connection with statutory and regulatory filings and the review of documents filed with the SEC and other capital markets or local financial reporting regulatory bodies. | |
(2) | Audit-Related Fees consist of fees billed for assurance and related services that are reasonably related to the performance of the audit or review of the company’s financial statements or that are traditionally performed by the independent auditor, and include consultations concerning financial accounting and reporting standards; SAS 70 audit of internal controls; advice on tax accounting matters; advice and assistance in connection with local statutory accounting requirements; due diligence related to acquisitions; financial due diligence in connection with provision of funding to customers, reports in relation to covenants in loan agreements; employee benefit plan audits and reviews; and audit procedures in connection with investigations and compliance programs. | |
(3) | Tax fees include fees billed for (i) corporate and indirect compliance including preparation and/or review of tax returns, preparation, review and/or filing of various certificates and forms and consultation regarding tax returns and assistance with revenue authority queries; (ii) transfer pricing advice and assistance with tax clearances; (iii) customs duties reviews and advise; (iv) consultations and tax audits (assistance with technical tax queries and tax audits and appeals and advise on mergers, acquisitions and restructurings); (v) personal compliance (preparation of individual tax returns and registrations for employees (non-executives), assistance with applying visa, residency, work permits and tax status for expatriates); and (vi) consultation and planning |
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(advice on stock based remuneration, local employer tax laws, social security laws, employment laws and compensation programs, tax implications on short-term international transfers). | ||
(4) | All Other Fees include fees billed for company establishment, forensic accounting, data security, investigations and reviews of licensing arrangements with customers and occasional training or reference materials and services. |
ITEM 16D. | EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES |
ITEM 16E. | PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS |
ITEM 16F. | CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT |
ITEM 16G. | CORPORATE GOVERNANCE |
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ITEM 17. | FINANCIAL STATEMENTS |
ITEM 18. | FINANCIAL STATEMENTS |
Consolidated Financial Statements Report of Independent Registered Public Accounting Firm | F-1 | |||
Consolidated Income Statements | F-2 | |||
Consolidated Statements of Comprehensive Income | F-3 | |||
Consolidated Statements of Financial Position | F-4 | |||
Consolidated Statements of Cash Flows | F-5 | |||
Consolidated Statements of Changes in Shareholders’ Equity | F-7 | |||
Notes to the Consolidated Financial Statements | F-9 |
ITEM 19. | EXHIBITS |
1 | Articles of Association of Nokia Corporation. | |||
6 | See Note 28 to our consolidated financial statements included in Item 18 of this annual report for information on how earnings per share information was calculated. | |||
8 | List of significant subsidiaries. | |||
12 | .1 | Certification of Stephen Elop, Chief Executive Officer of Nokia Corporation, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
12 | .2 | Certification of Timo Ihamuotila, Chief Financial Officer of Nokia Corporation, pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | ||
13 | Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |||
15 | .(a) | Consent of Independent Registered Public Accounting Firm. |
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Financial Year Ended December 31 | ||||||||||||||
Notes | 2010 | 2009 | 2008 | |||||||||||
EURm | EURm | EURm | ||||||||||||
Net sales | 42 446 | 40 984 | 50 710 | |||||||||||
Cost of sales | (29 629 | ) | (27 720 | ) | (33 337 | ) | ||||||||
Gross profit | 12 817 | 13 264 | 17 373 | |||||||||||
Research and development expenses | (5 863 | ) | (5 909 | ) | (5 968 | ) | ||||||||
Selling and marketing expenses | (3 877 | ) | (3 933 | ) | (4 380 | ) | ||||||||
Administrative and general expenses | (1 115 | ) | (1 145 | ) | (1 284 | ) | ||||||||
Impairment of goodwill | 8 | — | (908 | ) | — | |||||||||
Other income | 7 | 476 | 338 | 420 | ||||||||||
Other expenses | 7,8 | (368 | ) | (510 | ) | (1 195 | ) | |||||||
Operating profit | 2-10,24 | 2 070 | 1 197 | 4 966 | ||||||||||
Share of results of associated companies | 15,31 | 1 | 30 | 6 | ||||||||||
Financial income and expenses | 8,11 | (285 | ) | (265 | ) | (2 | ) | |||||||
Profit before tax | 1 786 | 962 | 4 970 | |||||||||||
Tax | 12 | (443 | ) | (702 | ) | (1 081 | ) | |||||||
Profit | 1 343 | 260 | 3 889 | |||||||||||
Profit attributable to equity holders of the parent | 1 850 | 891 | 3 988 | |||||||||||
Loss attributable to non-controlling interests | (507 | ) | (631 | ) | (99 | ) | ||||||||
1 343 | 260 | 3 889 | ||||||||||||
2010 | 2009 | 2008 | ||||||||||||
Earnings per share | 28 | EUR | EUR | EUR | ||||||||||
(for profit attributable to the equity holders of the parent) | ||||||||||||||
Basic | 0.50 | 0.24 | 1.07 | |||||||||||
Diluted | 0.50 | 0.24 | 1.05 | |||||||||||
2010 | 2009 | 2008 | ||||||||||||
Average number of shares (000’s shares) | 28 | |||||||||||||
Basic | 3 708 816 | 3 705 116 | 3 743 622 | |||||||||||
Diluted | 3 713 250 | 3 721 072 | 3 780 363 |
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Financial Year Ended December 31 | ||||||||||||||
Notes | 2010 | 2009 | 2008 | |||||||||||
EURm | EURm | EURm | ||||||||||||
Profit | 1 343 | 260 | 3 889 | |||||||||||
Other comprehensive income | ||||||||||||||
Translation differences | 22 | 1 302 | (563 | ) | 595 | |||||||||
Net investment hedge gains (losses) | 22 | (389 | ) | 114 | (123 | ) | ||||||||
Cash flow hedges | 21 | (141 | ) | 25 | (40 | ) | ||||||||
Available-for-sale investments | 21 | 9 | 48 | (15 | ) | |||||||||
Other increase (decrease), net | 45 | (7 | ) | 28 | ||||||||||
Income tax related to components of other comprehensive income | 21,22 | 126 | (44 | ) | 58 | |||||||||
Other comprehensive income (expense), net of tax | 952 | (427 | ) | 503 | ||||||||||
Total comprehensive income (expense) | 2 295 | (167 | ) | 4 392 | ||||||||||
Total comprehensive income (expense) attributable to | ||||||||||||||
equity holders of the parent | 2 776 | 429 | 4 577 | |||||||||||
non-controlling interests | (481 | ) | (596 | ) | (185 | ) | ||||||||
2 295 | (167 | ) | 4 392 | |||||||||||
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December 31 | ||||||||||
Notes | 2010 | 2009 | ||||||||
EURm | EURm | |||||||||
ASSETS | ||||||||||
Non-current assets | ||||||||||
Capitalized development costs | 13 | 40 | 143 | |||||||
Goodwill | 13 | 5 723 | 5 171 | |||||||
Other intangible assets | 13 | 1 928 | 2 762 | |||||||
Property, plant and equipment | 14 | 1 954 | 1 867 | |||||||
Investments in associated companies | 15 | 136 | 69 | |||||||
Available-for-sale investments | 16 | 533 | 554 | |||||||
Deferred tax assets | 25 | 1 596 | 1 507 | |||||||
Long-term loans receivable | 16,35 | 64 | 46 | |||||||
Other non-current assets | 16 | 4 | 6 | |||||||
11 978 | 12 125 | |||||||||
Current assets | ||||||||||
Inventories | 18,20 | 2 523 | 1 865 | |||||||
Accounts receivable, net of allowances for doubtful accounts (2010: EUR 363 million, 2009: EUR 391 million) | 16,20,35 | 7 570 | 7 981 | |||||||
Prepaid expenses and accrued income | 19 | 4 360 | 4 551 | |||||||
Current portion of long-term loans receivable | 16,35 | 39 | 14 | |||||||
Other financial assets | 16,17,35 | 378 | 329 | |||||||
Investments at fair value through profit and loss, liquid assets | 16,35 | 911 | 580 | |||||||
Available-for-sale investments, liquid assets | 16,35 | 3 772 | 2 367 | |||||||
Available-for-sale investments, cash equivalents | 16,35 | 5 641 | 4 784 | |||||||
Bank and cash | 35 | 1 951 | 1 142 | |||||||
27 145 | 23 613 | |||||||||
Total assets | 39 123 | 35 738 | ||||||||
SHAREHOLDERS’ EQUITY AND LIABILITIES | ||||||||||
Capital and reserves attributable to equity holders of the parent | ||||||||||
Share capital | 23 | 246 | 246 | |||||||
Share issue premium | 312 | 279 | ||||||||
Treasury shares, at cost | (663 | ) | (681 | ) | ||||||
Translation differences | 22 | 825 | (127 | ) | ||||||
Fair value and other reserves | 21 | 3 | 69 | |||||||
Reserve for invested non-restricted equity | 3 161 | 3 170 | ||||||||
Retained earnings | 10 500 | 10 132 | ||||||||
14 384 | 13 088 | |||||||||
Non-controlling interests | 1 847 | 1 661 | ||||||||
Total equity | 16 231 | 14 749 | ||||||||
Non-current liabilities | ||||||||||
Long-term interest-bearing liabilities | 16,35 | 4 242 | 4 432 | |||||||
Deferred tax liabilities | 25 | 1 022 | 1 303 | |||||||
Other long-term liabilities | 88 | 66 | ||||||||
5 352 | 5 801 | |||||||||
Current liabilities | ||||||||||
Current portion of long-term loans | 16,35 | 116 | 44 | |||||||
Short-term borrowings | 16,35 | 921 | 727 | |||||||
Other financial liabilities | 16,17,35 | 447 | 245 | |||||||
Accounts payable | 16,35 | 6 101 | 4 950 | |||||||
Accrued expenses and other liabilities | 26 | 7 365 | 6 504 | |||||||
Provisions | 27 | 2 590 | 2 718 | |||||||
17 540 | 15 188 | |||||||||
Total shareholders’ equity and liabilities | 39 123 | 35 738 | ||||||||
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Financial Year Ended | ||||||||||||||||
December 31 | ||||||||||||||||
Notes | 2010 | 2009 | 2008 | |||||||||||||
EURm | EURm | EURm | ||||||||||||||
Cash flow from operating activities | ||||||||||||||||
Profit attributable to equity holders of the parent | 1 850 | 891 | 3 988 | |||||||||||||
Adjustments, total | 32 | 2 112 | 3 390 | 3 024 | ||||||||||||
Change in net working capital | 32 | 2 349 | 140 | (2 546 | ) | |||||||||||
Cash generated from operations | 6 311 | 4 421 | 4 466 | |||||||||||||
Interest received | 110 | 125 | 416 | |||||||||||||
Interest paid | (235 | ) | (256 | ) | (155 | ) | ||||||||||
Other financial income and expenses, net | (507 | ) | (128 | ) | 250 | |||||||||||
Income taxes paid, net | (905 | ) | (915 | ) | (1 780 | ) | ||||||||||
Net cash from operating activities | 4 774 | 3 247 | 3 197 | |||||||||||||
Cash flow from investing activities | ||||||||||||||||
Acquisition of Group companies, net of acquired cash | (110 | ) | (29 | ) | (5 962 | ) | ||||||||||
Purchase of currentavailable-for-sale investments, liquid assets | (8 573 | ) | (2 800 | ) | (669 | ) | ||||||||||
Purchase of investments at fair value through profit and loss, liquid assets | (646 | ) | (695 | ) | — | |||||||||||
Purchase of non-currentavailable-for-sale investments | (124 | ) | (95 | ) | (121 | ) | ||||||||||
Purchase of shares in associated companies | (33 | ) | (30 | ) | (24 | ) | ||||||||||
Additions to capitalized development costs | — | (27 | ) | (131 | ) | |||||||||||
Proceeds from repayment and sale of long-term loans receivable | — | — | 129 | |||||||||||||
Proceeds from (+) / payment of (-) other long-term receivables | 2 | 2 | (1 | ) | ||||||||||||
Proceeds from (+) / payment of (-) short-term loans receivable | (2 | ) | 2 | (15 | ) | |||||||||||
Capital expenditures | (679 | ) | (531 | ) | (889 | ) | ||||||||||
Proceeds from disposal of shares in Group companies, net of disposed cash | (21 | ) | — | — | ||||||||||||
Proceeds from disposal of shares in associated companies | 5 | 40 | 3 | |||||||||||||
Proceeds from disposal of businesses | 141 | 61 | 41 | |||||||||||||
Proceeds from maturities and sale of currentavailable-for-sale investments, liquid assets | 7 181 | 1 730 | 4 664 | |||||||||||||
Proceeds from maturities and sale of investments at fair value through profit and loss, liquid assets | 333 | 108 | — | |||||||||||||
Proceeds from sale of non-currentavailable-for-sale investments | 83 | 14 | 10 | |||||||||||||
Proceeds from sale of fixed assets | 21 | 100 | 54 | |||||||||||||
Dividends received | 1 | 2 | 6 | |||||||||||||
Net cash used in investing activities | (2 421 | ) | (2 148 | ) | (2 905 | ) |
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Financial Year Ended | ||||||||||||||||
December 31 | ||||||||||||||||
Notes | 2010 | 2009 | 2008 | |||||||||||||
EURm | EURm | EURm | ||||||||||||||
Cash flow from financing activities | ||||||||||||||||
Proceeds from stock option exercises | — | — | 53 | |||||||||||||
Purchase of treasury shares | 1 | — | (3 121 | ) | ||||||||||||
Proceeds from long-term borrowings | 482 | 3 901 | 714 | |||||||||||||
Repayment of long-term borrowings | (6 | ) | (209 | ) | (34 | ) | ||||||||||
Proceeds from (+) / repayment of (-) short-term borrowings | 131 | (2 842 | ) | 2 891 | ||||||||||||
Dividends paid | (1 519 | ) | (1 546 | ) | (2 048 | ) | ||||||||||
Net cash used in financing activities | (911 | ) | (696 | ) | (1 545 | ) | ||||||||||
Foreign exchange adjustment | 224 | (25 | ) | (49 | ) | |||||||||||
Net increase (+) / decrease (-) in cash and cash equivalents | 1 666 | 378 | (1 302 | ) | ||||||||||||
Cash and cash equivalents at beginning of period | 5 926 | 5 548 | 6 850 | |||||||||||||
Cash and cash equivalents at end of period | 7 592 | 5 926 | 5 548 | |||||||||||||
Cash and cash equivalents comprise of: | ||||||||||||||||
Bank and cash | 1 951 | 1 142 | 1 706 | |||||||||||||
Currentavailable-for-sale investments, cash equivalents | 16,35 | 5 641 | 4 784 | 3 842 | ||||||||||||
7 592 | 5 926 | 5 548 | ||||||||||||||
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Fair | ||||||||||||||||||||||||||||||||||||||||||||
value | Reserve for | Before | ||||||||||||||||||||||||||||||||||||||||||
Share | and | invested | non- | Non- | ||||||||||||||||||||||||||||||||||||||||
Number of | Share | issue | Treasury | Translation | other | non-restrict. | Retained | controlling | controlling | |||||||||||||||||||||||||||||||||||
shares (000’s) | capital | premium | shares | differences | reserves | equity | earnings | interests | interests | Total | ||||||||||||||||||||||||||||||||||
Balance at December 31, 2007 | 3 845 950 | 246 | 644 | (3 146 | ) | (163 | ) | 23 | 3 299 | 13 870 | 14 773 | 2 565 | 17 338 | |||||||||||||||||||||||||||||||
Translation differences | 595 | 595 | 595 | |||||||||||||||||||||||||||||||||||||||||
Net investment hedge losses, net of tax | (91 | ) | (91 | ) | (91 | ) | ||||||||||||||||||||||||||||||||||||||
Cash flow hedges, net of tax | 42 | 42 | (67 | ) | (25 | ) | ||||||||||||||||||||||||||||||||||||||
Available-for-sale investments, net of tax | (3 | ) | (3 | ) | (2 | ) | (5 | ) | ||||||||||||||||||||||||||||||||||||
Other increase, net | 46 | 46 | (17 | ) | 29 | |||||||||||||||||||||||||||||||||||||||
Profit | 3 988 | 3 988 | (99 | ) | 3 889 | |||||||||||||||||||||||||||||||||||||||
Total comprehensive income | — | — | — | 504 | 39 | — | 4 034 | 4 577 | (185 | ) | 4 392 | |||||||||||||||||||||||||||||||||
Stock options exercised | 3 547 | 51 | 51 | 51 | ||||||||||||||||||||||||||||||||||||||||
Stock options exercised related to acquisitions | 1 | 1 | 1 | |||||||||||||||||||||||||||||||||||||||||
Share-based compensation | 74 | 74 | 74 | |||||||||||||||||||||||||||||||||||||||||
Excess tax benefit on share-based compensation | (117 | ) | (117 | ) | (6 | ) | (124 | ) | ||||||||||||||||||||||||||||||||||||
Settlement of performance and restricted shares | 5 622 | (179 | ) | 154 | (44 | ) | (69 | ) | (69 | ) | ||||||||||||||||||||||||||||||||||
Acquisition of treasury shares | (157 390 | ) | (3 123 | ) | (3 123 | ) | (3 123 | ) | ||||||||||||||||||||||||||||||||||||
Reissuance of treasury shares | 143 | 2 | 2 | 2 | ||||||||||||||||||||||||||||||||||||||||
Cancellation of treasury shares | — | 4 232 | (4 232 | ) | — | — | ||||||||||||||||||||||||||||||||||||||
Dividend | (1 992 | ) | (1 992 | ) | (35 | ) | (2 027 | ) | ||||||||||||||||||||||||||||||||||||
Acquisitions and other change in non-controlling interests | (37 | ) | (37 | ) | ||||||||||||||||||||||||||||||||||||||||
Vested portion of share-based payment awards related to acquisitions | 19 | 19 | 19 | |||||||||||||||||||||||||||||||||||||||||
Acquisition of Symbian | 12 | 12 | 12 | |||||||||||||||||||||||||||||||||||||||||
Total of other equity movements | — | (202 | ) | 1 265 | — | — | 7 | (6 212 | ) | (5 142 | ) | (78 | ) | (5 220 | ) | |||||||||||||||||||||||||||||
Balance at December 31, 2008 | 3 697 872 | 246 | 442 | (1 881 | ) | 341 | 62 | 3 306 | 11 692 | 14 208 | 2 302 | 16 510 | ||||||||||||||||||||||||||||||||
Translation differences | (552 | ) | (552 | ) | (9 | ) | (561 | ) | ||||||||||||||||||||||||||||||||||||
Net investment hedge gains, net of tax | 84 | 84 | 84 | |||||||||||||||||||||||||||||||||||||||||
Cash flow hedges, net of tax | (35 | ) | (35 | ) | 49 | 14 | ||||||||||||||||||||||||||||||||||||||
Available-for-sale investments, net of tax | 42 | 42 | 2 | 44 | ||||||||||||||||||||||||||||||||||||||||
Other decrease, net | (1 | ) | (1 | ) | (7 | ) | (8 | ) | ||||||||||||||||||||||||||||||||||||
Profit | 891 | 891 | (631 | ) | 260 | |||||||||||||||||||||||||||||||||||||||
Total comprehensive income | — | — | — | (468 | ) | 7 | — | 890 | 429 | (596 | ) | (167 | ) | |||||||||||||||||||||||||||||||
Stock options exercised | 7 | — | — | — | ||||||||||||||||||||||||||||||||||||||||
Stock options exercised related to acquisitions | (1 | ) | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||||||||
Share-based compensation | 16 | 16 | 16 | |||||||||||||||||||||||||||||||||||||||||
Excess tax benefit on share-based compensation | (12 | ) | (12 | ) | (1 | ) | (13 | ) | ||||||||||||||||||||||||||||||||||||
Settlement of performance and restricted shares | 10 352 | (166 | ) | 230 | (136 | ) | (72 | ) | (72 | ) | ||||||||||||||||||||||||||||||||||
Acquisition of treasury shares | — | — | ||||||||||||||||||||||||||||||||||||||||||
Reissuance of treasury shares | 31 | 1 | 1 | 1 | ||||||||||||||||||||||||||||||||||||||||
Cancellation of treasury shares | 969 | (969 | ) | — | — |
F-7
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Fair | ||||||||||||||||||||||||||||||||||||||||||||
value | Reserve for | Before | ||||||||||||||||||||||||||||||||||||||||||
Share | and | invested | non- | Non- | ||||||||||||||||||||||||||||||||||||||||
Number of | Share | issue | Treasury | Translation | other | non-restrict. | Retained | controlling | controlling | |||||||||||||||||||||||||||||||||||
shares (000’s) | capital | premium | shares | differences | reserves | equity | earnings | interests | interests | Total | ||||||||||||||||||||||||||||||||||
Dividend | (1 481 | ) | (1 481 | ) | (44 | ) | (1 525 | ) | ||||||||||||||||||||||||||||||||||||
Total of other equity movements | — | (163 | ) | 1 200 | — | — | (136 | ) | (2 450 | ) | (1 549 | ) | (45 | ) | (1 594 | ) | ||||||||||||||||||||||||||||
Balance at December 31, 2009 | 3 708 262 | 246 | 279 | (681 | ) | (127 | ) | 69 | 3 170 | 10 132 | 13 088 | 1 661 | 14 749 | |||||||||||||||||||||||||||||||
Translation differences | 1 240 | 1 240 | 64 | 1 304 | ||||||||||||||||||||||||||||||||||||||||
Net investment hedge losses, net of tax | (288 | ) | (288 | ) | (288 | ) | ||||||||||||||||||||||||||||||||||||||
Cash flow hedges, net of tax | (73 | ) | (73 | ) | (43 | ) | (116 | ) | ||||||||||||||||||||||||||||||||||||
Available-for-sale investments, net of tax | 7 | 7 | 7 | |||||||||||||||||||||||||||||||||||||||||
Other increase, net | 40 | 40 | 5 | 45 | ||||||||||||||||||||||||||||||||||||||||
Profit | 1 850 | 1 850 | (507 | ) | 1 343 | |||||||||||||||||||||||||||||||||||||||
Total comprehensive income | — | — | — | 952 | (66 | ) | — | 1 890 | 2 776 | (481 | ) | 2 295 | ||||||||||||||||||||||||||||||||
Stock options exercised related to acquisitions | (1 | ) | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||||||||
Share-based compensation | 47 | 47 | 47 | |||||||||||||||||||||||||||||||||||||||||
Excess tax benefit on share-based compensation | (1 | ) | (1 | ) | (1 | ) | ||||||||||||||||||||||||||||||||||||||
Settlement of performance and restricted shares | 868 | (12 | ) | 17 | (9 | ) | (4 | ) | (4 | ) | ||||||||||||||||||||||||||||||||||
Reissuance of treasury shares | 1 | 1 | 1 | |||||||||||||||||||||||||||||||||||||||||
Conversion of debt to equity | 766 | 766 | ||||||||||||||||||||||||||||||||||||||||||
Dividend | (1 483 | ) | (1 483 | ) | (56 | ) | (1 539 | ) | ||||||||||||||||||||||||||||||||||||
Acquisitions and other change in non-controlling interests | (39 | ) | (39 | ) | (43 | ) | (82 | ) | ||||||||||||||||||||||||||||||||||||
Total of other equity movements | — | 33 | 18 | — | — | (9 | ) | (1 522 | ) | (1 480 | ) | 667 | (813 | ) | ||||||||||||||||||||||||||||||
Balance at December 31, 2010 | 3 709 130 | 246 | 312 | (663 | ) | 825 | 3 | 3 161 | 10 500 | 14 384 | 1 847 | 16 231 | ||||||||||||||||||||||||||||||||
F-8
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1. | Accounting principles |
• | IFRS 3 (revised) Business Combinations replaces IFRS 3 (as issued in 2004). The main changes brought by IFRS 3 (revised) include clarification of the definition of a business, immediate recognition of all acquisition-related costs in profit or loss, recognition of subsequent changes in the fair value of contingent consideration in accordance with other IFRSs and measurement of goodwill arising from step acquisitions at the acquisition date. | |
• | IAS 27 (revised), “Consolidated and Separate Financial Statements” clarifies presentation of changes in parent-subsidiary ownership. Changes in a parent’s ownership interest in a subsidiary that do not result in the loss of control must be accounted for exclusively within equity. If a parent loses control of a subsidiary, it shall derecognize the consolidated assets and liabilities, and any investment retained in the former subsidiary shall be recognized at fair value at the date when control is lost. Any differences resulting from this shall be recognized in profit or loss. When losses attributed to the non-controlling interests exceed the non-controlling shareholder’s interest in the subsidiary’s equity, these losses shall be allocated to the non-controlling interests even if this results in a deficit balance. | |
• | Amendments to IFRS 2 and IFRIC 11 clarify that an entity that receives goods or services in a share-based payment arrangement should account for those goods or services regardless of which entity in the group settles the transaction, and regardless of whether the transaction is settled in shares or cash. | |
• | Amendments to IFRIC 14 and IAS 19 address the circumstances when an entity is subject to minimum funding requirements and makes an early payment of contributions to cover those requirements. The amendment permits such an entity to treat the benefit of such an early payment as an asset. | |
• | In addition, a number of other amendments that form part of the IASB’s annual improvement project were adopted by the Group. |
F-9
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1. | Accounting principles (Continued) |
F-10
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1. | Accounting principles (Continued) |
F-11
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1. | Accounting principles (Continued) |
F-12
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1. | Accounting principles (Continued) |
Buildings and constructions | 20 - 33 years | |||
Production machinery, measuring and test equipment | 1 - 3 years | |||
Other machinery and equipment | 3 - 10 years |
F-13
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1. | Accounting principles (Continued) |
F-14
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1. | Accounting principles (Continued) |
F-15
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1. | Accounting principles (Continued) |
F-16
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1. | Accounting principles (Continued) |
F-17
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1. | Accounting principles (Continued) |
F-18
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1. | Accounting principles (Continued) |
F-19
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1. | Accounting principles (Continued) |
F-20
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1. | Accounting principles (Continued) |
F-21
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1. | Accounting principles (Continued) |
F-22
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1. | Accounting principles (Continued) |
F-23
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1. | Accounting principles (Continued) |
2. | Segment information |
F-24
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Corporate | ||||||||||||||||||||||||||||
Common | ||||||||||||||||||||||||||||
Nokia | Total | Functions and | ||||||||||||||||||||||||||
Devices & | Siemens | reportable | Corporate | |||||||||||||||||||||||||
2010 | Services | NAVTEQ | Networks | segments | unallocated(4),(6) | Eliminations | Group | |||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
Profit and Loss Information | ||||||||||||||||||||||||||||
Net sales to external customers | 29 118 | 668 | 12 660 | 42 446 | — | 42 446 | ||||||||||||||||||||||
Net sales to other segments | 16 | 334 | 1 | 351 | — | (351 | ) | — | ||||||||||||||||||||
Depreciation and amortization | 405 | 519 | 843 | 1 767 | 4 | 1 771 | ||||||||||||||||||||||
Impairment | — | — | 2 | 2 | 13 | 15 | ||||||||||||||||||||||
Operating profit / (loss) | 3 299 | (225 | ) | (686 | ) | 2 388 | (114 | ) | (204 | )(7) | 2 070 | |||||||||||||||||
Share of results of associated | ||||||||||||||||||||||||||||
companies | — | 2 | 11 | 13 | (12 | ) | 1 | |||||||||||||||||||||
Balance Sheet Information | ||||||||||||||||||||||||||||
Capital expenditures(2) | 337 | 36 | 306 | 679 | — | 679 | ||||||||||||||||||||||
Segment assets(3) | 9 560 | 6 492 | 10 621 | 26 673 | 14 998 | (2 548 | ) | 39 123 | ||||||||||||||||||||
of which: | ||||||||||||||||||||||||||||
Investments in associated companies | — | 7 | 42 | 49 | 87 | 136 | ||||||||||||||||||||||
Segment liabilities(5) | 10 146 | 2 488 | 7 190 | 19 824 | 5 616 | (2 548 | ) | 22 892 |
Corporate | ||||||||||||||||||||||||||||
Common | ||||||||||||||||||||||||||||
Nokia | Total | Functions and | ||||||||||||||||||||||||||
Devices & | Siemens | reportable | Corporate | |||||||||||||||||||||||||
2009 | Services | NAVTEQ | Networks | segments | unallocated(4),(6) | Eliminations | Group | |||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
Profit and Loss Information | ||||||||||||||||||||||||||||
Net sales to external customers | 27 841 | 579 | 12 564 | 40 984 | — | 40 984 | ||||||||||||||||||||||
Net sales to other segments | 12 | 91 | 10 | 113 | — | (113 | ) | — | ||||||||||||||||||||
Depreciation and amortization | 432 | 488 | 860 | 1 780 | 4 | 1 784 | ||||||||||||||||||||||
Impairment | 56 | — | 919 | 975 | 34 | 1 009 | ||||||||||||||||||||||
Operating profit / (loss)(1) | 3 314 | (344 | ) | (1 639 | ) | 1 331 | (134 | ) | 1 197 | |||||||||||||||||||
Share of results of associated companies | — | — | 32 | 32 | (2 | ) | 30 | |||||||||||||||||||||
Balance Sheet Information | ||||||||||||||||||||||||||||
Capital expenditures(2) | 232 | 21 | 278 | 531 | — | 531 | ||||||||||||||||||||||
Segment assets(3) | 9 203 | 6 145 | 11 015 | 26 363 | 12 479 | (3 104 | ) | 35 738 | ||||||||||||||||||||
of which: | ||||||||||||||||||||||||||||
Investments in associated companies | — | 5 | 26 | 31 | 38 | 69 | ||||||||||||||||||||||
Segment liabilities(5) | 8 268 | 2 330 | 7 927 | 18 525 | 5 568 | (3 104 | ) | 20 989 |
F-25
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Corporate | ||||||||||||||||||||||||||||
Common | ||||||||||||||||||||||||||||
Nokia | Total | Functions and | ||||||||||||||||||||||||||
Devices & | Siemens | reportable | Corporate | |||||||||||||||||||||||||
2008 | Services | NAVTEQ | Networks | segments | unallocated(4),(6) | Eliminations | Group | |||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
Profit and Loss Information | ||||||||||||||||||||||||||||
Net sales to external customers | 35 084 | 318 | 15 308 | 50 710 | — | 50 710 | ||||||||||||||||||||||
Net sales to other segments | 15 | 43 | 1 | 59 | — | (59 | ) | — | ||||||||||||||||||||
Depreciation and amortization | 484 | 238 | 889 | 1 611 | 6 | 1 617 | ||||||||||||||||||||||
Impairment | 58 | — | 47 | 105 | 33 | 138 | ||||||||||||||||||||||
Operating profit / (loss) | 5 816 | (153 | ) | (301 | ) | 5 362 | (396 | ) | 4 966 | |||||||||||||||||||
Share of results of associated companies | — | — | (13 | ) | (13 | ) | 19 | 6 | ||||||||||||||||||||
Balance Sheet Information | ||||||||||||||||||||||||||||
Capital expenditures(2) | 578 | 18 | 292 | 888 | 1 | 889 | ||||||||||||||||||||||
Segment assets(3) | 10 300 | 7 177 | 15 652 | 33 129 | 9 641 | (3 188 | ) | 39 582 | ||||||||||||||||||||
of which: | ||||||||||||||||||||||||||||
Investments in associated companies | — | 4 | 62 | 66 | 30 | 96 | ||||||||||||||||||||||
Segment liabilities(5) | 8 425 | 2 726 | 10 503 | 21 654 | 4 606 | (3 188 | ) | 23 072 |
(1) | Nokia Siemens Networks operating loss in 2009 includes a goodwill impairment loss of EUR 908 million. | |
(2) | Including goodwill, capital expenditures in 2010 amount to EUR 761 million (EUR 590 million in 2009). The goodwill and capitalized development costs consist of EUR 73 million in 2010 (EUR 7 million in 2009) for Devices & Services, EUR 9 million in 2010 (EUR 22 million in 2009) for NAVTEQ, EUR 0 million in 2010 (EUR 30 million in 2009) for Nokia Siemens Networks, and EUR 0 million in 2010 (EUR 0 million in 2009) for Corporate Common Functions. | |
(3) | Comprises intangible assets, property, plant and equipment, investments, inventories and accounts receivable as well as prepaid expenses and accrued income except those related to interest and taxes for Devices & Services and Corporate Common Functions. In addition, NAVTEQ’s and Nokia Siemens Networks’ assets include cash and other liquid assets,available-for-sale investments, long-term loans receivable and other financial assets as well as interest and tax related prepaid expenses and accrued income. These are directly attributable to NAVTEQ and Nokia Siemens Networks as they are separate legal entities. | |
(4) | Unallocated assets include cash and other liquid assets,available-for-sale investments, long-term loans receivable and other financial assets as well as interest and tax related prepaid expenses and accrued income for Devices & Services and Corporate Common Functions. | |
(5) | Comprises accounts payable, accrued expenses and other liabilities as well as provisions except those related to interest and taxes for Devices & Services and Corporate Common Functions. In addition, NAVTEQ’s and Nokia Siemens Networks’ liabilities include non-current liabilities and short-term borrowings as well as interest and tax related prepaid income and accrued expenses and provisions. These are directly attributable to NAVTEQ and Nokia Siemens Networks as they are separate legal entities. | |
(6) | Unallocated liabilities include non-current liabilities and short-term borrowings as well as interest and tax related prepaid income, accrued expenses and provisions related to Devices & Services and Corporate Common Functions. | |
(7) | Elimination of profits recognized in NAVTEQ that are deferred in Devices & Services related to Ovi Maps service sold in combination with Nokia’s GPS enabled smartphones. |
F-26
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Net sales to external customers by geographic area by location of customer | 2010 | 2009 | 2008 | |||||||||||||
EURm | EURm | EURm | ||||||||||||||
Finland | 371 | 390 | 362 | |||||||||||||
China | 7 149 | 5 990 | 5 916 | |||||||||||||
India | 2 952 | 2 809 | 3 719 | |||||||||||||
Germany | 2 019 | 1 733 | 2 294 | |||||||||||||
Russia | 1 744 | 1 528 | 2 083 | |||||||||||||
USA | 1 630 | 1 731 | 1 907 | |||||||||||||
Brazil | 1 506 | 1 333 | 1 902 | |||||||||||||
UK | 1 470 | 1 916 | 2 382 | |||||||||||||
Other | 23 605 | 23 554 | 30 145 | |||||||||||||
Total | 42 446 | 40 984 | 50 710 | |||||||||||||
Segment non-current assets by geographic area(8) | 2010 | 2009 | ||||||
EURm | EURm | |||||||
Finland | 1 501 | 1 698 | ||||||
China | 402 | 358 | ||||||
India | 210 | 180 | ||||||
Germany | 209 | 243 | ||||||
USA | 6 079 | 5 859 | ||||||
UK | 236 | 228 | ||||||
Other | 1 008 | 1 377 | ||||||
Total | 9 645 | 9 943 | ||||||
(8) | Comprises intangible assets and property, plant and equipment. |
3. | Percentage of completion |
F-27
Table of Contents
4. | Personnel expenses |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Wages and salaries | 5 808 | 5 658 | 5 615 | |||||||||
Share-based compensation expense | 48 | 13 | 67 | |||||||||
Pension expenses, net | 431 | 427 | 478 | |||||||||
Other social expenses | 708 | 649 | 754 | |||||||||
Personnel expenses as per income statement | 6 995 | 6 747 | 6 914 | |||||||||
2010 | 2009 | 2008 | ||||||||||
Average personnel | ||||||||||||
Devices & Services | 58 642 | 56 462 | 57 443 | |||||||||
NAVTEQ | 5 020 | 4 282 | 3 969 | |||||||||
Nokia Siemens Networks | 65 379 | 62 129 | 59 965 | |||||||||
Group Common Functions | 314 | 298 | 346 | |||||||||
Nokia Group | 129 355 | 123 171 | 121 723 | |||||||||
5. | Pensions |
F-28
Table of Contents
5. | Pensions (Continued) |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Present value of defined benefit obligations at beginning of year | (1 411 | ) | (1 205 | ) | ||||
Foreign exchange | (49 | ) | 5 | |||||
Current service cost | (61 | ) | (55 | ) | ||||
Interest cost | (78 | ) | (69 | ) | ||||
Plan participants’ contributions | (8 | ) | (12 | ) | ||||
Past service cost | (1 | ) | — | |||||
Actuarial gain (loss) | 1 | (139 | ) | |||||
Acquisitions | (1 | ) | 2 | |||||
Curtailment | 1 | — | ||||||
Settlements | 17 | 2 | ||||||
Benefits paid | 46 | 60 | ||||||
Present value of defined benefit obligations at end of year | (1 544 | ) | (1 411 | ) | ||||
Plan assets at fair value at beginning of year | 1 330 | 1 197 | ||||||
Foreign exchange | 44 | (7 | ) | |||||
Expected return on plan assets | 76 | 70 | ||||||
Actuarial gain (loss) on plan assets | 9 | 56 | ||||||
Employer contribution | 62 | 49 | ||||||
Plan participants’ contributions | 8 | 12 | ||||||
Benefits paid | (32 | ) | (44 | ) | ||||
Settlements | (6 | ) | (2 | ) | ||||
Acquisitions | 3 | (1 | ) | |||||
Plan assets at fair value at end of year | 1 494 | 1 330 | ||||||
Surplus (Deficit) | (50 | ) | (81 | ) | ||||
Unrecognized net actuarial (gains) losses | (26 | ) | (21 | ) | ||||
Unrecognized past service cost | 1 | 1 | ||||||
Amount not recognized as an asset in the balance sheet because of limit in IAS 19 paragraph 58(b) | (9 | ) | (5 | ) | ||||
Prepaid (Accrued) pension cost in the statement of financial position | (84 | ) | (106 | ) | ||||
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5. | Pensions (Continued) |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Current service cost | 61 | 55 | 79 | |||||||||
Interest cost | 78 | 69 | 78 | |||||||||
Expected return on plan assets | (76 | ) | (70 | ) | (71 | ) | ||||||
Net actuarial (gains) losses recognized in year | (1 | ) | (9 | ) | — | |||||||
Impact of paragraph 58(b) limitation | 3 | 5 | — | |||||||||
Past service cost (gain) loss | 1 | — | 2 | |||||||||
Curtailment | (1 | ) | — | (12 | ) | |||||||
Settlement | (11 | ) | — | 152 | ||||||||
Total, included in personnel expenses | 54 | 50 | 228 | |||||||||
2010 | 2009 | |||||||
EURm | EURm | |||||||
Prepaid (accrued) pension costs at beginning of year | (106 | ) | (120 | ) | ||||
Net income (expense) recognized in the profit and loss account | (54 | ) | (50 | ) | ||||
Contributions paid | 62 | 49 | ||||||
Benefits paid | 14 | 16 | ||||||
Acquisitions | 2 | 1 | ||||||
Foreign exchange | (2 | ) | (2 | ) | ||||
Prepaid (accrued) pension costs at end of year* | (84 | ) | (106 | ) | ||||
* | included within prepaid expenses and accrued income / accrued expenses |
2010 | 2009 | 2008 | 2007 | 2006 | ||||||||||||||||
EURm | EURm | EURm | EURm | EURm | ||||||||||||||||
Present value of defined benefit obligations | (1 544 | ) | (1 411 | ) | (1 205 | ) | (2 266 | ) | (1 577 | ) | ||||||||||
Plan assets at fair value | 1 494 | 1 330 | 1 197 | 2 174 | 1 409 | |||||||||||||||
Surplus/(Deficit) | (50 | ) | (81 | ) | (8 | ) | (92 | ) | (168 | ) | ||||||||||
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5. | Pensions (Continued) |
2010 | 2009 | |||||||
% | % | |||||||
Discount rate for determining present values | 5.1 | 5.3 | ||||||
Expected long-term rate of return on plan assets | 5.1 | 5.4 | ||||||
Annual rate of increase in future compensation levels | 2.6 | 2.8 | ||||||
Pension increases | 2.0 | 2.0 |
2010 | 2009 | |||||||
% | % | |||||||
Asset category: | ||||||||
Equity securities | 23 | 18 | ||||||
Debt securities | 57 | 64 | ||||||
Insurance contracts | 8 | 8 | ||||||
Short-term investments | 4 | 5 | ||||||
Other | 8 | 5 | ||||||
Total | 100 | 100 | ||||||
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2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Cost of material | 20 917 | 19 502 | 23 892 | |||||||||
Personnel expenses | 6 995 | 6 747 | 6 914 | |||||||||
Depreciation and amortization | 1 771 | 1 784 | 1 617 | |||||||||
Advertising and promotional expenses | 1 291 | 1 335 | 1 600 | |||||||||
Warranty costs | 894 | 696 | 1 020 | |||||||||
Other costs and expenses | 8 616 | 8 643 | 9 926 | |||||||||
Total of Cost of sales, Research and development, Selling and marketing and Administrative and general expenses | 40 484 | 38 707 | 44 969 | |||||||||
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2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Goodwill | — | 908 | — | |||||||||
Other intangible assets | — | 56 | — | |||||||||
Property, plant and equipment | — | 1 | 77 | |||||||||
Inventories | — | — | 13 | |||||||||
Investments in associated companies | — | 19 | 8 | |||||||||
Available-for-sale investments | 107 | 25 | 43 | |||||||||
Other non-current assets | 3 | — | 8 | |||||||||
Total | 110 | 1 009 | 149 | |||||||||
Cash-generating unit | ||||||||||||
Devices & | ||||||||||||
Services | NAVTEQ | |||||||||||
% | % | |||||||||||
Terminal growth rate | 2.0 | 4.0 | ||||||||||
Post-tax discount rate | 8.7 | 9.6 | ||||||||||
Pre-tax discount rate | 11.1 | 12.8 |
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• | MetaCarta Inc, based in Cambridge, USA, provides unique geographic intelligence technology and expertise in geographic intelligence solutions. The Group acquired a 100% ownership in MetaCarta on April 9, 2010. |
• | Novarra Inc, based in Chicago, USA, is a provider of a mobile browser and service platform with more than 100 employees. The Group acquired a 100% ownership interest in Novarra on April 9, 2010. |
• | Motally Inc, a US-based company, provides mobile analytics services offering in-application tracking and reporting. The Group acquired a 100% ownership interest in Motally on August 31, 2010. |
• | PixelActive Inc, based in California, USA, specialises in tools and techniques for 3D modeling of detailed road networks, buildings and terrain. NAVTEQ acquired a 100% ownership interest in PixelActive on November 17, 2010. |
• | Plum Ventures, Inc, based in Boston, USA, develops and operates a cloud-based social media sharing and messaging service for private groups. The Group acquired certain assets of Plum on September 11, 2009. |
• | Dopplr Oy, based in Helsinki, Finland, provides a Social Atlas that enables members to share travel plans and preferences privately with their networks. The Group acquired a 100% ownership interest in Dopplr on September 28, 2009. |
• | Huano Technology Co., Ltd, based in Changsha, China, is an infrastructure service provider with Nokia Siemens Networks as its primary customer. Nokia Siemens Networks increased its ownership interest in Huano from 49% to 100% on July 22, 2009. |
• | T-Systems Traffic GmbH is a leading German provider of dynamic mobility services delivering near real-time data about traffic flow and road conditions. NAVTEQ acquired a 100% ownership interest in T-Systems Traffic on January 2, 2009. |
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• | Acuity Mobile, based in Greenbelt, USA, is a leading provider of mobile marketing content delivery solutions. NAVTEQ acquired a 100% ownership interest in Acuity Mobile on September 11, 2009. |
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Carrying Amount | Fair Value | Useful lives | ||||||||||
EURm | EURm | |||||||||||
Goodwill | 114 | 3 673 | ||||||||||
Intangible assets subject to amortization: | ||||||||||||
Map database | 5 | 1 389 | 5 years | |||||||||
Customer relationships | 22 | 388 | 4 years | |||||||||
Developed technology | 8 | 110 | 4 years | |||||||||
License to use trade name and trademark | 7 | 57 | 6 years | |||||||||
Capitalized development costs | 22 | — | ||||||||||
Other intangible assets | 4 | 7 | ||||||||||
68 | 1 951 | |||||||||||
Property, plant & equipment | 84 | 83 | ||||||||||
Deferred tax assets | 262 | 148 | ||||||||||
Available-for-sale investments | 36 | 36 | ||||||||||
Other non-current assets | 6 | 6 | ||||||||||
Non-current assets | 456 | 2 224 | ||||||||||
Inventories | 3 | 3 | ||||||||||
Accounts receivable | 94 | 94 | ||||||||||
Prepaid expenses and accrued income | 36 | 36 | ||||||||||
Available-for-sale investments, liquid assets | 140 | 140 | ||||||||||
Available-for-sale investments, cash equivalents | 97 | 97 | ||||||||||
Bank and cash | 57 | 57 | ||||||||||
Current Assets | 427 | 427 | ||||||||||
Total assets acquired | 997 | 6 324 | ||||||||||
Deferred tax liabilities | 46 | 786 | ||||||||||
Other long-term liabilities | 54 | 39 | ||||||||||
Non-current liabilities | 100 | 825 | ||||||||||
Accounts payable | 29 | 29 | ||||||||||
Accrued expenses | 96 | 120 | ||||||||||
Provisions | 5 | 8 | ||||||||||
Current liabilities | 130 | 157 | ||||||||||
Total liabilities assumed | 230 | 982 | ||||||||||
Net assets acquired | 767 | 5 342 | ||||||||||
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Carrying Amount | Fair Value | |||||||
EURm | EURm | |||||||
Goodwill | — | 470 | ||||||
Intangible assets subject to amortization: | ||||||||
Developed technology | 5 | 41 | ||||||
Customer relationships | — | 11 | ||||||
License to use trade name and trademark | — | 3 | ||||||
5 | 55 | |||||||
Property, plant & equipment | 33 | 31 | ||||||
Deferred tax assets | 7 | 19 | ||||||
Non-current assets | 45 | 105 | ||||||
Accounts receivable | 20 | 20 | ||||||
Prepaid expenses and accrued income | 43 | 43 | ||||||
Bank and cash | 147 | 147 | ||||||
Current Assets | 210 | 210 | ||||||
Total assets acquired | 255 | 785 | ||||||
Deferred tax liabilities | — | 17 | ||||||
Accounts payable | 5 | 5 | ||||||
Accrued expenses | 48 | 53 | ||||||
Financial liabilities | — | 20 | ||||||
Total liabilities assumed | 53 | 95 | ||||||
Net assets acquired | 202 | 690 | ||||||
Revaluation of previously held interests in Symbian | 22 | |||||||
Nokia share of changes in Symbian’s equity after each stage of the acquisition | 27 | |||||||
Cost of the business combination | 641 | |||||||
Pro forma | 2008 | |||
EURm | ||||
Net sales | 51 063 | |||
Net profit | 4 080 |
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• | Trolltech ASA, based in Oslo, Norway, is a recognised software provider with world-class software development platforms and frameworks. The Group acquired a 100% ownership interest in Trolltech ASA on 6 June 2008. |
• | Oz Communications Inc., headquartered in Montreal, Canada, is a leading consumer mobile messaging solution provider delivering access to popular instant messaging and email services on consumer mobile devices. The Group acquired a 100% ownership interest in Oz Communications Inc. on 4 November 2008. |
• | Atrica, based in Santa Clara, USA, is one of the leading providers of Carrier Ethernet solutions for Metropolitan Area Networks. Nokia Siemens Networks acquired a 100% ownership interest in Atrica on 7 January 2008. |
• | Apertio Ltd, based in Bristol, England is the leading independent provider of subscriber-centric networks for mobile, fixed and converged telecommunications operators. Nokia Siemens Networks acquired a 100% ownership interest in Apertio Ltd on 11 February 2008. |
• | On January 1, 2008, Nokia Siemens Networks assumed control of Vivento Technical Services from Deutsche Telekom. |
10. | Depreciation and amortization |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Depreciation and amortization by function | ||||||||||||
Cost of sales | 248 | 266 | 297 | |||||||||
Research and development(1) | 906 | 909 | 778 | |||||||||
Selling and marketing(2) | 426 | 424 | 368 | |||||||||
Administrative and general | 191 | 185 | 174 | |||||||||
Total | 1 771 | 1 784 | 1 617 | |||||||||
(1) | In 2010, depreciation and amortization allocated to research and development included amortization of acquired intangible assets of EUR 556 million (EUR 534 million in 2009 and EUR 351 million in 2008, respectively). | |
(2) | In 2010, depreciation and amortization allocated to selling and marketing included amortization of acquired intangible assets of EUR 408 million (EUR 401 million in 2009 and EUR 343 million in 2008, respectively). |
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11. | Financial income and expenses |
2010 | 2009 | 2008 | ||||||||||
EURm | ||||||||||||
Dividend income onavailable-for-sale financial investments | 2 | 3 | 1 | |||||||||
Interest income onavailable-for-sale financial investments | 110 | 101 | 357 | |||||||||
Interest expense on financial liabilities carried at amortised cost | (254 | ) | (243 | ) | (185 | ) | ||||||
Net realised gains (or losses) on disposal of fixed incomeavailable-for-sale financial investments | 1 | 2 | (4 | ) | ||||||||
Net fair value gains (or losses) on investments at fair value through profit and loss | (3 | ) | 19 | — | ||||||||
Interest income on investments at fair value through profit and loss | 28 | 11 | — | |||||||||
Net fair value gains (or losses) on hedged items under fair value hedge accounting | (63 | ) | (4 | ) | — | |||||||
Net fair value gains (or losses) on hedging instruments under fair value hedge accounting | 58 | — | — | |||||||||
Other financial income | 73 | 18 | 17 | |||||||||
Other financial expenses | (129 | ) | (29 | ) | (31 | ) | ||||||
Net foreign exchange gains (or losses) | ||||||||||||
From foreign exchange derivatives designated at fair value through profit and loss account | 58 | (358 | ) | 432 | ||||||||
From balance sheet items revaluation | (165 | ) | 230 | (595 | ) | |||||||
Net gains (net losses) on other derivatives designated at fair value through profit and loss account | (1 | ) | (15 | ) | 6 | |||||||
Total | (285 | ) | (265 | ) | (2 | ) | ||||||
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11. | Financial income and expenses(Continued) |
12. | Income taxes |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Income tax | ||||||||||||
Current tax | (798 | ) | (736 | ) | (1 514 | ) | ||||||
Deferred tax | 355 | 34 | 433 | |||||||||
Total | (443 | ) | (702 | ) | (1 081 | ) | ||||||
Finland | (126 | ) | 76 | (604 | ) | |||||||
Other countries | (317 | ) | (778 | ) | (477 | ) | ||||||
Total | (443 | ) | (702 | ) | (1 081 | ) | ||||||
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Income tax expense at statutory rate | 464 | 250 | 1 292 | |||||||||
Permanent differences | 4 | (96 | ) | (65 | ) | |||||||
Non tax deductible impairment of Nokia Siemens Networks’ goodwill(1) | — | 236 | — | |||||||||
Taxes for prior years | (48 | ) | (17 | ) | (128 | ) | ||||||
Taxes on foreign subsidiaries’ profits in excess of (lower than) income taxes at statutory rates | (195 | ) | (145 | ) | (181 | ) | ||||||
Change in losses and temporary differences with no tax effect(2) | 221 | 577 | — | |||||||||
Net increase (decrease) in tax contingencies | 24 | (186 | ) | 2 | ||||||||
Change in income tax rates | 2 | 4 | (22 | ) | ||||||||
Deferred tax liability on undistributed earnings(3) | (31 | ) | 111 | 220 | ||||||||
Other | 2 | (32 | ) | (37 | ) | |||||||
Income tax expense | 443 | 702 | 1 081 | |||||||||
(1) | see note 8 | |
(2) | This item primarily relates to Nokia Siemens Networks’ losses and temporary differences for which no deferred tax was recognized. In 2010, it also includes a benefit of EUR 52 million from the reassessment of recoverability of deferred tax assets in Nokia Siemens Networks. | |
(3) | The change in deferred tax liability on undistributed earnings mainly relates to changes to tax rates applicable to profit distributions. |
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13. | Intangible assets |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Capitalized development costs | ||||||||
Acquisition cost January 1 | 1 830 | 1 811 | ||||||
Additions during the period | — | 27 | ||||||
Impairment losses | (11 | ) | — | |||||
Retirements during the period | (784 | ) | — | |||||
Disposals during the period | — | (8 | ) | |||||
Accumulated acquisition cost December 31 | 1 035 | 1 830 | ||||||
Accumulated amortization January 1 | (1 687 | ) | (1 567 | ) | ||||
Retirements during the period | 784 | — | ||||||
Impairment losses | 11 | — | ||||||
Disposals during the period | — | 8 | ||||||
Amortization for the period | (103 | ) | (128 | ) | ||||
Accumulated amortization December 31 | (995 | ) | (1 687 | ) | ||||
Net book value January 1 | 143 | 244 | ||||||
Net book value December 31 | 40 | 143 | ||||||
Goodwill | ||||||||
Acquisition cost January 1 | 6 079 | 6 257 | ||||||
Translation differences | 470 | (207 | ) | |||||
Acquisitions | 82 | 32 | ||||||
Disposals during the period | — | (3 | ) | |||||
Accumulated acquisition cost December 31 | 6 631 | 6 079 | ||||||
�� | ||||||||
Accumulated impairments January 1 | (908 | ) | — | |||||
Impairments during the period | — | (908 | ) | |||||
Accumulated impairments December 31 | (908 | ) | (908 | ) | ||||
Net book value January 1 | 5 171 | 6 257 | ||||||
Net book value December 31 | 5 723 | 5 171 | ||||||
Other intangible assets | ||||||||
Acquisition cost January 1 | 5 287 | 5 498 | ||||||
Translation differences | 216 | (142 | ) | |||||
Additions during the period | 58 | 50 | ||||||
Acquisitions | 21 | 3 | ||||||
Retirements during the period | (142 | ) | (26 | ) | ||||
Impairments during the period | — | (94 | ) | |||||
Disposals during the period | (3 | ) | (2 | ) | ||||
Accumulated acquisition cost December 31 | 5 437 | 5 287 | ||||||
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13. | Intangible assets (Continued) |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Accumulated amortization January 1 | (2 525 | ) | (1 585 | ) | ||||
Translation differences | (42 | ) | 56 | |||||
Retirements during the period | 125 | 17 | ||||||
Impairments during the period | — | 38 | ||||||
Disposals during the period | 2 | 2 | ||||||
Amortization for the period | (1 069 | ) | (1 053 | ) | ||||
Accumulated amortization December 31 | (3 509 | ) | (2 525 | ) | ||||
Net book value January 1 | 2 762 | 3 913 | ||||||
Net book value December 31 | 1 928 | 2 762 |
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14. | Property, plant and equipment |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Land and water areas | ||||||||
Acquisition cost January 1 | 59 | 60 | ||||||
Additions during the period | — | 1 | ||||||
Disposals during the period | (2 | ) | (2 | ) | ||||
Accumulated acquisition cost December 31 | 57 | 59 | ||||||
Net book value January 1 | 59 | 60 | ||||||
Net book value December 31 | 57 | 59 | ||||||
Buildings and constructions | ||||||||
Acquisition cost January 1 | 1 312 | 1 274 | ||||||
Translation differences | 69 | (17 | ) | |||||
Additions during the period | 86 | 132 | ||||||
Disposals during the period | (53 | ) | (77 | ) | ||||
Accumulated acquisition cost December 31 | 1 414 | 1 312 | ||||||
Accumulated depreciation January 1 | (385 | ) | (350 | ) | ||||
Translation differences | (19 | ) | 3 | |||||
Disposals during the period | 41 | 42 | ||||||
Depreciation for the period | (90 | ) | (80 | ) | ||||
Accumulated depreciation December 31 | (453 | ) | (385 | ) | ||||
Net book value January 1 | 927 | 924 | ||||||
Net book value December 31 | 961 | 927 | ||||||
Machinery and equipment | ||||||||
Acquisition cost January 1 | 3 984 | 4 183 | ||||||
Translation differences | 213 | (67 | ) | |||||
Additions during the period | 472 | 386 | ||||||
Acquisitions | 4 | 1 | ||||||
Impairments during the period | — | (1 | ) | |||||
Disposals during the period | (669 | ) | (518 | ) | ||||
Accumulated acquisition cost December 31 | 4 004 | 3 984 | ||||||
Accumulated depreciation January 1 | (3 168 | ) | (3 197 | ) | ||||
Translation differences | (164 | ) | 50 | |||||
Disposals during the period | 639 | 489 | ||||||
Depreciation for the period | (492 | ) | (510 | ) | ||||
Accumulated depreciation December 31 | (3 185 | ) | (3 168 | ) | ||||
Net book value January 1 | 816 | 986 | ||||||
Net book value December 31 | 819 | 816 |
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14. | Property, plant and equipment (Continued) |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Other tangible assets | ||||||||
Acquisition cost January 1 | 47 | 30 | ||||||
Translation differences | 6 | (2 | ) | |||||
Additions during the period | 15 | 19 | ||||||
Disposals during the period | (12 | ) | — | |||||
Accumulated acquisition cost December 31 | 56 | 47 | ||||||
Accumulated depreciation January 1 | (27 | ) | (15 | ) | ||||
Translation differences | (2 | ) | 1 | |||||
Disposals during the period | 9 | — | ||||||
Depreciation for the period | (17 | ) | (13 | ) | ||||
Accumulated depreciation December 31 | (37 | ) | (27 | ) | ||||
Net book value January 1 | 20 | 15 | ||||||
Net book value December 31 | 19 | 20 | ||||||
Advance payments and fixed assets under construction | ||||||||
Net carrying amount January 1 | 45 | 105 | ||||||
Translation differences | 3 | (2 | ) | |||||
Additions | 92 | 29 | ||||||
Disposals | (1 | ) | (1 | ) | ||||
Transfers to: | ||||||||
Other intangible assets | — | (3 | ) | |||||
Buildings and constructions | (20 | ) | (34 | ) | ||||
Machinery and equipment | (10 | ) | (36 | ) | ||||
Other tangible assets | (11 | ) | (13 | ) | ||||
Net carrying amount December 31 | 98 | 45 | ||||||
Total property, plant and equipment | 1 954 | 1 867 |
15. | Investments in associated companies |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Net carrying amount January 1 | 69 | 96 | ||||||
Translation differences | 3 | (4 | ) | |||||
Additions | 63 | 30 | ||||||
Deductions | (6 | ) | (50 | ) | ||||
Impairments | — | (19 | ) | |||||
Share of results | 1 | 30 | ||||||
Dividend | (1 | ) | — | |||||
Other movements | 7 | (14 | ) | |||||
Net carrying amount December 31 | 136 | 69 | ||||||
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15. | Investments in associated companies — (Continued) |
16. | Fair value of financial instruments |
Carrying amounts | ||||||||||||||||||||||||||||
Financial | ||||||||||||||||||||||||||||
instruments | ||||||||||||||||||||||||||||
at fair | Loans and | Financial | ||||||||||||||||||||||||||
Current | Non-current | value | receivables | liabilities | ||||||||||||||||||||||||
available-for- | available-for- | through | measured at | measured at | Total | |||||||||||||||||||||||
sale financial | sale financial | profit or | amortised | amortised | carrying | Fair | ||||||||||||||||||||||
At December 31, 2010 | assets | assets | loss | cost | cost | amounts | value | |||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
Available-for-sale investments in publicly quoted equity shares | 8 | 8 | 8 | |||||||||||||||||||||||||
Otheravailable-for-sale investments carried at fair value | 293 | 293 | 293 | |||||||||||||||||||||||||
Otheravailable-for-sale investments carried at cost less impairment | 232 | 232 | 232 | |||||||||||||||||||||||||
Long-term loans receivable | 64 | 64 | 60 | |||||||||||||||||||||||||
Other non-current assets | 4 | 4 | 4 | |||||||||||||||||||||||||
Accounts receivable | 7 570 | 7 570 | 7 570 | |||||||||||||||||||||||||
Current portion of long-term loans receivable | 39 | 39 | 39 | |||||||||||||||||||||||||
Derivative assets | 366 | 366 | 366 | |||||||||||||||||||||||||
Other current financial assets | 12 | 12 | 12 | |||||||||||||||||||||||||
Fixed income and money-market investments carried at fair value | 9 413 | 9 413 | 9 413 | |||||||||||||||||||||||||
Investments designated at fair value through profit and loss | 911 | 911 | 911 | |||||||||||||||||||||||||
Total financial assets | 9 413 | 533 | 1 277 | 7 689 | — | 18 912 | 18 908 | |||||||||||||||||||||
Long-term interest-bearing liabilities | 4 242 | 4 242 | 4 467 | |||||||||||||||||||||||||
Other long-term non-interest bearing financial liabilities | 13 | 13 | 13 | |||||||||||||||||||||||||
Current portion of long-term loans payable | 116 | 116 | 116 | |||||||||||||||||||||||||
Short-term borrowings | 921 | 921 | 921 | |||||||||||||||||||||||||
Other financial liabilities | 359 | 88 | 447 | 447 | ||||||||||||||||||||||||
Accounts payable | 6 101 | 6 101 | 6 101 | |||||||||||||||||||||||||
Total financial liabilities | — | — | 359 | — | 11 481 | 11 840 | 12 065 | |||||||||||||||||||||
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16. | Fair value of financial instruments (Continued) |
Carrying amounts | ||||||||||||||||||||||||||||
Financial | ||||||||||||||||||||||||||||
instruments | ||||||||||||||||||||||||||||
at fair | Loans and | Financial | ||||||||||||||||||||||||||
Current | Non-current | value | receivables | liabilities | ||||||||||||||||||||||||
available-for- | available-for- | through | measured at | measured at | Total | |||||||||||||||||||||||
sale financial | sale financial | profit or | amortised | amortised | carrying | Fair | ||||||||||||||||||||||
At December 31, 2009 | assets | assets | loss | cost | cost | amounts | value | |||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
Available-for-sale investments in publicly quoted equity shares | 8 | 8 | 8 | |||||||||||||||||||||||||
Otheravailable-for-sale investments carried at fair value | 257 | 257 | 257 | |||||||||||||||||||||||||
Otheravailable-for-sale investments carried at cost less impairment | 258 | 258 | 258 | |||||||||||||||||||||||||
Long-term loans receivable | 46 | 46 | 40 | |||||||||||||||||||||||||
Other non-current assets | 6 | 6 | 6 | |||||||||||||||||||||||||
Accounts receivable | 7 981 | 7 981 | 7 981 | |||||||||||||||||||||||||
Current portion of long-term loans receivable | 14 | 14 | 14 | |||||||||||||||||||||||||
Derivative assets | 316 | 316 | 316 | |||||||||||||||||||||||||
Other current financial assets | 13 | 13 | 13 | |||||||||||||||||||||||||
Fixed income and money-market investments carried at fair value | 7 151 | 31 | 7 182 | 7 182 | ||||||||||||||||||||||||
Investments designated at fair value through profit and loss | 580 | 580 | 580 | |||||||||||||||||||||||||
Total financial assets | 7 151 | 554 | 896 | 8 060 | — | 16 661 | 16 655 | |||||||||||||||||||||
Long-term interest-bearing liabilities | 4 432 | 4 432 | 4 691 | |||||||||||||||||||||||||
Other long-term non-interest bearing financial liabilities | 2 | 2 | 2 | |||||||||||||||||||||||||
Current portion of long-term loans payable | 44 | 44 | 44 | |||||||||||||||||||||||||
Short-term borrowings | 727 | 727 | 727 | |||||||||||||||||||||||||
Other financial liabilities | 245 | 245 | 245 | |||||||||||||||||||||||||
Accounts payable | 4 950 | 4 950 | 4 950 | |||||||||||||||||||||||||
Total financial liabilities | — | — | 245 | — | 10 155 | 10 400 | 10 659 | |||||||||||||||||||||
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16. | Fair value of financial instruments (Continued) |
Valuation | Valuation | |||||||||||||||
Instruments | technique | technique | ||||||||||||||
with quoted | using | using non- | ||||||||||||||
prices in active | observable | observable | ||||||||||||||
markets | data | data | ||||||||||||||
At December 31, 2010 | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
Fixed income and money-market investments carried at fair value | 9 215 | 198 | — | 9 413 | ||||||||||||
Investments at fair value through profit and loss | 911 | — | — | 911 | ||||||||||||
Available-for-sale investments in publicly quoted equity shares | 8 | — | — | 8 | ||||||||||||
Otheravailable-for-sale investments carried at fair value | — | 14 | 279 | 293 | ||||||||||||
Derivative assets | — | 366 | — | 366 | ||||||||||||
Total assets | 10 134 | 578 | 279 | 10 991 | ||||||||||||
Derivative liabilities | — | 359 | — | 359 | ||||||||||||
Total liabilities | — | 359 | — | 359 | ||||||||||||
Valuation | Valuation | |||||||||||||||
Instruments | technique | technique | ||||||||||||||
with quoted | using | using non- | ||||||||||||||
prices in active | observable | observable | ||||||||||||||
markets | data | data | ||||||||||||||
At December 31, 2009 | (Level 1) | (Level 2) | (Level 3) | Total | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
Fixed income and money-market investments carried at fair value | 6 933 | 249 | — | 7 182 | ||||||||||||
Investments at fair value through profit and loss | 580 | — | — | 580 | ||||||||||||
Available-for-sale investments in publicly quoted equity shares | 8 | — | — | 8 | ||||||||||||
Otheravailable-for-sale investments carried at fair value | — | 15 | 242 | 257 | ||||||||||||
Derivative assets | — | 316 | — | 316 | ||||||||||||
Total assets | 7 521 | 580 | 242 | 8 343 | ||||||||||||
Derivative liabilities | — | 245 | — | 245 | ||||||||||||
Total liabilities | — | 245 | — | 245 | ||||||||||||
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16. | Fair value of financial instruments (Continued) |
Other | ||||
available-for-sale | ||||
investments carried at | ||||
EURm | fair value | |||
Balance at December 31, 2008 | 214 | |||
Total gains (losses) in income statement | (30 | ) | ||
Total gains (losses) recorded in other comprehensive income | 15 | |||
Purchases | 45 | |||
Sales | (2 | ) | ||
Transfer from level 1 and 2 | — | |||
Balance at December 31, 2009 | 242 | |||
Total gains (losses) in income statement | 3 | |||
Total gains (losses) recorded in other comprehensive income | (11 | ) | ||
Purchases | 78 | |||
Sales | (34 | ) | ||
Transfer from associated companies | 1 | |||
Transfer from level 1 and 2 | — | |||
Balance at December 31, 2010 | 279 | |||
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17. | Derivative financial instruments |
Assets | Liabilities | |||||||||||||||
2010 | Fair value(1) | Notional(2) | Fair value(1) | Notional(2) | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
Hedges of net investment in foreign subsidiaries: | ||||||||||||||||
Forward foreign exchange contracts | 66 | 2 254 | (154 | ) | 4 433 | |||||||||||
Cash flow hedges: | ||||||||||||||||
Forward foreign exchange contracts | 41 | 8 025 | (57 | ) | 8 572 | |||||||||||
Fair value hedges | ||||||||||||||||
Interest rate swaps | 128 | 1 550 | (8 | ) | 76 | |||||||||||
Cash flow and Fair value hedges:(3) | ||||||||||||||||
Cross currency interest rate swaps | — | — | (6 | ) | 378 | |||||||||||
Derivatives not designated in hedge accounting relationships carried at fair value through profit and loss: | ||||||||||||||||
Forward foreign exchange contracts | 73 | 5 349 | (69 | ) | 7 956 | |||||||||||
Currency options bought | 13 | 1 959 | — | — | ||||||||||||
Currency options sold | — | — | (15 | ) | 749 | |||||||||||
Interest rate swaps | 45 | 1 028 | (50 | ) | 1 199 | |||||||||||
366 | 20 165 | (359 | ) | 23 363 | ||||||||||||
Assets | Liabilities | |||||||||||||||
2009 | Fair value(1) | Notional(2) | Fair value(1) | Notional(2) | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
Hedges of net investment in foreign subsidiaries: | ||||||||||||||||
Forward foreign exchange contracts | 12 | 1 128 | (42 | ) | 2 317 | |||||||||||
Cash flow hedges: | ||||||||||||||||
Forward foreign exchange contracts | 25 | 8 062 | (25 | ) | 7 027 | |||||||||||
Interest rate swaps | — | — | (2 | ) | 330 | |||||||||||
Fair value hedges | ||||||||||||||||
Interest rate swaps | 117 | 1 750 | (10 | ) | 68 | |||||||||||
Cash flow and Fair value hedges:(3) | ||||||||||||||||
Cross currency interest rate swaps | — | �� | (77 | ) | 416 | |||||||||||
Derivatives not designated in hedge accounting relationships carried at fair value through profit and loss: | ||||||||||||||||
Forward foreign exchange contracts | 147 | 5 785 | (68 | ) | 6 504 | |||||||||||
Currency options bought | 8 | 442 | — | — | ||||||||||||
Currency options sold | — | — | (1 | ) | 102 | |||||||||||
Interest rate swaps | 7 | 68 | (20 | ) | 499 | |||||||||||
Cash settled equity options bought(4) | — | 6 | — | — | ||||||||||||
316 | 17 241 | (245 | ) | 17 263 | ||||||||||||
(1) | The fair value of derivative financial instruments is included on the asset side under heading Other financial assets and on the liability side under Other financial liabilities. |
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17. | Derivative financial instruments (Continued) |
(2) | Includes the gross amount of all notional values for contracts that have not yet been settled or cancelled. The amount of notional value outstanding is not necessarily a measure or indication of market risk, as the exposure of certain contracts may be offset by that of other contracts. | |
(3) | These cross-currency interest rate swaps have been designated partly as fair value hedges and partly as cash flow hedges. | |
(4) | Cash settled equity options are used to hedge risk relating to employee incentive programs and investment activities. |
18. | Inventories |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Raw materials, supplies and other | 762 | 409 | ||||||
Work in progress | 642 | 681 | ||||||
Finished goods | 1 119 | 775 | ||||||
Total | 2 523 | 1 865 | ||||||
19. | Prepaid expenses and accrued income |
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20. | Valuation and qualifying accounts |
Balance at | Charged to | Balance | ||||||||||||||||||
beginning | cost and | at end | ||||||||||||||||||
Allowances on assets to which they apply: | of year | expenses | Deductions(1) | Acquisitions | of year | |||||||||||||||
EURm | EURm | EURm | EURm | EURm | ||||||||||||||||
2010 | ||||||||||||||||||||
Allowance for doubtful accounts | 391 | 117 | (145 | ) | — | 363 | ||||||||||||||
Excess and obsolete inventory | 361 | 124 | (184 | ) | — | 301 | ||||||||||||||
2009 | ||||||||||||||||||||
Allowance for doubtful accounts | 415 | 155 | (179 | ) | — | 391 | ||||||||||||||
Excess and obsolete inventory | 348 | 192 | (179 | ) | — | 361 | ||||||||||||||
2008 | ||||||||||||||||||||
Allowance for doubtful accounts | 332 | 224 | (141 | ) | — | 415 | ||||||||||||||
Excess and obsolete inventory | 417 | 151 | (221 | ) | 1 | 348 |
(1) | Deductions include utilization and releases of the allowances. |
21. | Fair value and other reserves |
Available-for-sale | ||||||||||||||||||||||||||||||||||||
Hedging reserve, EURm | investments, EURm | Total, EURm | ||||||||||||||||||||||||||||||||||
Gross | Tax | Net | Gross | Tax | Net | Gross | Tax | Net | ||||||||||||||||||||||||||||
Balance at December 31, 2007 | 54 | (15 | ) | 39 | (17 | ) | 1 | (16 | ) | 37 | (14 | ) | 23 | |||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | 281 | (67 | ) | 214 | — | — | — | 281 | (67 | ) | 214 | |||||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Net Sales | (631 | ) | 177 | (454 | ) | — | — | — | (631 | ) | 177 | (454 | ) | |||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Cost of Sales | 186 | (62 | ) | 124 | — | — | — | 186 | (62 | ) | 124 | |||||||||||||||||||||||||
Transfer of (gains) losses as a basis adjustment to assets and liabilities | 124 | (32 | ) | 92 | — | — | — | 124 | (32 | ) | 92 | |||||||||||||||||||||||||
Available-for-sale Investments: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | — | — | — | (29 | ) | 9 | (20 | ) | (29 | ) | 9 | (20 | ) | |||||||||||||||||||||||
Transfer to income statement on impairment | — | — | — | 1 | — | 1 | 1 | — | 1 | |||||||||||||||||||||||||||
Transfer of net fair value (gains) losses to income statement on disposal | — | — | — | 13 | 1 | 14 | 13 | 1 | 14 | |||||||||||||||||||||||||||
Movements attributable to non-controlling interests | 87 | (21 | ) | 66 | 3 | (1 | ) | 2 | 90 | (22 | ) | 68 | ||||||||||||||||||||||||
Balance at December 31, 2008 | 101 | (20 | ) | 81 | (29 | ) | 10 | (19 | ) | 72 | (10 | ) | 62 | |||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | (19 | ) | 6 | (13 | ) | — | — | — | (19 | ) | 6 | (13 | ) | |||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Net Sales | 873 | (222 | ) | 651 | — | — | — | 873 | (222 | ) | 651 | |||||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Cost of Sales | (829 | ) | 205 | (624 | ) | — | — | — | (829 | ) | 205 | (624 | ) |
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21. | Fair value and other reserves (Continued) |
Available-for-sale | ||||||||||||||||||||||||||||||||||||
Hedging reserve, EURm | investments, EURm | Total, EURm | ||||||||||||||||||||||||||||||||||
Gross | Tax | Net | Gross | Tax | Net | Gross | Tax | Net | ||||||||||||||||||||||||||||
Available-for-sale Investments: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | — | — | — | 36 | (4 | ) | 32 | 36 | (4 | ) | 32 | |||||||||||||||||||||||||
Transfer to income statement on impairment | — | — | — | 14 | — | 14 | 14 | — | 14 | |||||||||||||||||||||||||||
Transfer of net fair value (gains) losses to income statement on disposal | — | — | — | (2 | ) | — | (2 | ) | (2 | ) | — | (2 | ) | |||||||||||||||||||||||
Movements attributable to non-controlling interests | (65 | ) | 16 | (49 | ) | (2 | ) | — | (2 | ) | (67 | ) | 16 | (51 | ) | |||||||||||||||||||||
Balance at December 31, 2009 | 61 | (15 | ) | 46 | 17 | 6 | 23 | 78 | (9 | ) | 69 | |||||||||||||||||||||||||
Cash flow hedges: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | (119 | ) | 12 | (107 | ) | — | — | — | (119 | ) | 12 | (107 | ) | |||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Net Sales | 357 | (57 | ) | 300 | — | — | — | 357 | (57 | ) | 300 | |||||||||||||||||||||||||
Transfer of (gains) losses to income statement as adjustment to Cost of Sales | (379 | ) | 70 | (309 | ) | — | — | — | (379 | ) | 70 | (309 | ) | |||||||||||||||||||||||
Available-for-sale Investments: | ||||||||||||||||||||||||||||||||||||
Net fair value gains (losses) | — | — | — | (3 | ) | (2 | ) | (5 | ) | (3 | ) | (2 | ) | (5 | ) | |||||||||||||||||||||
Transfer to income statement on impairment | — | — | — | 13 | — | 13 | 13 | — | 13 | |||||||||||||||||||||||||||
Transfer of net fair value (gains) losses to income statement on disposal | — | — | — | (1 | ) | — | (1 | ) | (1 | ) | — | (1 | ) | |||||||||||||||||||||||
Movements attributable to non-controlling interests | 50 | (7 | ) | 43 | — | — | — | 50 | (7 | ) | 43 | |||||||||||||||||||||||||
Balance at December 31, 2010 | (30 | ) | 3 | (27 | ) | 26 | 4 | 30 | (4 | ) | 7 | 3 | ||||||||||||||||||||||||
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22. | Translation differences |
Translation | Net investment | |||||||||||||||||||||||||||||||||||
differences, EURm | hedging, EURm | Total, EURm | ||||||||||||||||||||||||||||||||||
Gross | Tax | Net | Gross | Tax | Net | Gross | Tax | Net | ||||||||||||||||||||||||||||
Balance at December 31, 2007 | (204 | ) | — | (204 | ) | 92 | (51 | ) | 41 | (112 | ) | (51 | ) | (163 | ) | |||||||||||||||||||||
Translation differences: | ||||||||||||||||||||||||||||||||||||
Currency translation differences | 595 | — | 595 | — | — | — | 595 | — | 595 | |||||||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Net investment hedging: | ||||||||||||||||||||||||||||||||||||
Net investment hedging gains (losses) | — | — | — | (123 | ) | 32 | (91 | ) | (123 | ) | 32 | (91 | ) | |||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Movements attributable to non-controlling interests | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Balance at December 31, 2008 | 391 | 0 | 391 | (31 | ) | (19 | ) | (50 | ) | 360 | (19 | ) | 341 | |||||||||||||||||||||||
Translation differences: | ||||||||||||||||||||||||||||||||||||
Currency translation differences | (556 | ) | 2 | (554 | ) | — | — | — | (556 | ) | 2 | (554 | ) | |||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | (7 | ) | — | (7 | ) | — | — | — | (7 | ) | — | (7 | ) | |||||||||||||||||||||||
Net investment hedging: | ||||||||||||||||||||||||||||||||||||
Net investment hedging gains (losses) | — | — | — | 114 | (31 | ) | 83 | 114 | (31 | ) | 83 | |||||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | — | — | — | 1 | — | 1 | 1 | — | 1 | |||||||||||||||||||||||||||
Movements attributable to non-controlling interests | 8 | 1 | 9 | — | — | — | 8 | 1 | 9 | |||||||||||||||||||||||||||
Balance at December 31, 2009 | (164 | ) | 3 | (161 | ) | 84 | (50 | ) | 34 | (80 | ) | (47 | ) | (127 | ) | |||||||||||||||||||||
Translation differences: | ||||||||||||||||||||||||||||||||||||
Currency translation differences | 1 302 | 3 | 1 305 | — | — | — | 1 302 | 3 | 1 305 | |||||||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Net investment hedging: | ||||||||||||||||||||||||||||||||||||
Net investment hedging gains (losses) | (389 | ) | 101 | (288 | ) | (389 | ) | 101 | (288 | ) | ||||||||||||||||||||||||||
Transfer to profit and loss (financial income and expense) | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Movements attributable to non-controlling interests | (63 | ) | (2 | ) | (65 | ) | — | — | — | (63 | ) | (2 | ) | (65 | ) | |||||||||||||||||||||
Balance at December 31, 2010 | 1 075 | 4 | 1 079 | (305 | ) | 51 | (254 | ) | 770 | 55 | 825 | |||||||||||||||||||||||||
23. | The shares of the Parent Company |
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23. | The shares of the Parent Company (Continued) |
F-56
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23. | The shares of the Parent Company (Continued) |
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Vesting | ||||||||||||||||||||||||||||
status | ||||||||||||||||||||||||||||
(as percentage of | ||||||||||||||||||||||||||||
Stock | total | |||||||||||||||||||||||||||
Plan | options | Number of | number of | Exercise | ||||||||||||||||||||||||
(year | outstanding | participants | Option (sub) | stock options | Exercise period | price/ | ||||||||||||||||||||||
of launch) | 2010 | (approx.) | category | outstanding) | First vest date | Last vest date | Expiry date | Share | ||||||||||||||||||||
EUR | ||||||||||||||||||||||||||||
2005 | (1) | 6 465 329 | 3 500 | 2005 2Q | Expired | July 1, 2006 | July 1, 2009 | December 31, 2010 | 12.79 | |||||||||||||||||||
2005 3Q | Expired | October 1, 2006 | October 1, 2009 | December 31, 2010 | 13.09 | |||||||||||||||||||||||
2005 4Q | Expired | January 1, 2007 | January 1, 2010 | December 31, 2010 | 14.48 | |||||||||||||||||||||||
2006 1Q | 100.00 | April 1, 2007 | April 1, 2010 | December 31, 2011 | 14.99 | |||||||||||||||||||||||
2006 2Q | 100.00 | July 1, 2007 | July 1, 2010 | December 31, 2011 | 18.02 | |||||||||||||||||||||||
2006 3Q | 100.00 | October 1, 2007 | October 1, 2010 | December 31, 2011 | 15.37 | |||||||||||||||||||||||
2006 4Q | 93.75 | January 1, 2008 | January 1, 2011 | December 31, 2011 | 15.38 | |||||||||||||||||||||||
2007 1Q | 87.50 | April 1, 2008 | April 1, 2011 | December 31, 2011 | 17.00 | |||||||||||||||||||||||
2007 | (1) | 15 278 270 | 11 000 | 2007 2Q | 81.25 | July 1, 2008 | July 1, 2011 | December 31, 2012 | 18.39 | |||||||||||||||||||
2007 3Q | 75.00 | October 1, 2008 | October 1, 2011 | December 31, 2012 | 21.86 | |||||||||||||||||||||||
2007 4Q | 68.75 | January 1, 2009 | January 1, 2012 | December 31, 2012 | 27.53 | |||||||||||||||||||||||
2008 1Q | 62.50 | April 1, 2009 | April 1, 2012 | December 31, 2013 | 24.15 | |||||||||||||||||||||||
2008 2Q | 56.25 | July 1, 2009 | July 1, 2012 | December 31, 2013 | 19.16 | |||||||||||||||||||||||
2008 3Q | 50.00 | October 1, 2009 | October 1, 2012 | December 31, 2013 | 17.80 | |||||||||||||||||||||||
2008 4Q | 43.75 | January 1, 2010 | January 1, 2013 | December 31, 2013 | 12.43 | |||||||||||||||||||||||
2009 1Q | 37.50 | April 1, 2010 | April 1, 2013 | December 31, 2014 | 9.82 | |||||||||||||||||||||||
2009 2Q | 31.25 | July 1, 2010 | July 1, 2013 | December 31, 2014 | 11.18 | |||||||||||||||||||||||
2009 3Q | 25.00 | October 1, 2010 | October 1, 2013 | December 31, 2014 | 9.28 | |||||||||||||||||||||||
2009 4Q | — | January 1, 2011 | January 1, 2014 | December 31, 2014 | 8.76 | |||||||||||||||||||||||
2010 1Q | — | April 1, 2011 | April 1, 2014 | December 31, 2015 | 10.11 | |||||||||||||||||||||||
2010 2Q | — | July 1, 2011 | July 1, 2014 | December 31, 2015 | 8.86 | |||||||||||||||||||||||
2010 3Q | — | October 1, 2011 | October 1, 2014 | December 31, 2015 | 7.29 | |||||||||||||||||||||||
2010 4Q | — | January 1, 2012 | January 1, 2015 | December 31, 2015 | 7.59 |
(1) | The Group’s current global stock option plans have a vesting schedule with a 25% vesting one year after grant, and quarterly vesting thereafter, each of the quarterly lots representing 6.25% of the total grant. The grants vest fully in four years. |
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Weighted average | Weighted | |||||||||||
exercise price | average share | |||||||||||
Number of shares | EUR(2) | price EUR(2) | ||||||||||
Shares under option at January 1, 2008 | 35 567 227 | 15.28 | ||||||||||
Granted | 3 767 163 | 17.44 | ||||||||||
Exercised | 3 657 985 | 14.21 | 22.15 | |||||||||
Forfeited | 783 557 | 16.31 | ||||||||||
Expired | 11 078 983 | 14.96 | ||||||||||
Shares under option at December 31, 2008 | 23 813 865 | 15.89 | ||||||||||
Granted | 4 791 232 | 11.15 | ||||||||||
Exercised | 104 172 | 6.18 | 9.52 | |||||||||
Forfeited | 893 943 | 17.01 | ||||||||||
Expired | 4 567 020 | 13.55 | ||||||||||
Shares under option at December 31, 2009 | 23 039 962 | 15.39 | ||||||||||
Granted | 6 708 582 | 8.73 | ||||||||||
Exercised | 39 772 | 2.20 | 9.44 | |||||||||
Forfeited | 1 698 435 | 12.07 | ||||||||||
Expired | 6 065 041 | 13.97 | ||||||||||
Shares under option at December 31, 2010 | 21 945 296 | 14.04 | ||||||||||
Options exercisable at December 31, 2007 (shares) | 21 535 000 | 14.66 | ||||||||||
Options exercisable at December 31, 2008 (shares) | 12 895 057 | 14.77 | ||||||||||
Options exercisable at December 31, 2009 (shares) | 13 124 925 | 16.09 | ||||||||||
Options exercisable at December 31, 2010 (shares) | 11 376 937 | 17.07 |
(1) | Includes also stock options granted under other than global equity plans. For further information see “Other equity plans for employees” below. | |
(2) | The weighted average exercise price and the weighted average share price do not incorporate the effect of transferable stock option exercises during 2007 by option holders not employed by the Group. |
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Options outstanding | ||||||
Weighted average | Weighted | |||||
remaining | average | |||||
contractual life | exercise | |||||
Exercise prices EUR | Number of shares | in years | price EUR | |||
0.94-9.82 | 6 201 937 | 5.00 | 8.66 | |||
10.11-14.99 | 4 973 503 | 3.78 | 11.46 | |||
15.37-19.16 | 10 681 907 | 1.61 | 18.28 | |||
19.43-27.53 | 87 949 | 1.70 | 23.96 | |||
21 945 296 | ||||||
2010 | 2009 | 2008 | ||||
Weighted average expected dividend yield | 4.73% | 3.63% | 3.20% | |||
Weighted average expected volatility | 52.09% | 43.46% | 39.92% | |||
Risk-free interest rate | 1.52% - 2.49% | 1.97% - 2.94% | 3.15% - 4.58% | |||
Weighted average risk-free interest rate | 1.78% | 2.23% | 3.65% | |||
Expected life (years) | 3.59 | 3.60 | 3.55 | |||
Weighted average share price, EUR | 8.27 | 10.82 | 16.97 |
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Performance | Number of | |||||||
shares outstanding | participants | Performance | ||||||
Plan | at threshold(1)(2) | (approx.) | period | Settlement | ||||
2007 | 0 | 5 000 | 2007-2009 | 2010 | ||||
2008 | 0 | 5 000 | 2008-2010 | 2011 | ||||
2009 | 2 469 189 | 5 000 | 2009-2011 | 2012 | ||||
2010 | 3 243 580 | 4 000 | 2010-2012 | 2013 |
(1) | Shares under performance share plan 2008 vested on December 31, 2010 and are therefore not included in the outstanding numbers. | |
(2) | Does not include 7 354 outstanding performance shares with deferred delivery due to leave of absence. |
Threshold Performance | Maximum Performance | |||||||||||||||||||
Average Annual | Average Annual | |||||||||||||||||||
Plan | EPS(1)(2) | Net Sales Growth(1) | EPS(1)(2) | Net Sales Growth(1) | ||||||||||||||||
EUR | EUR | |||||||||||||||||||
2007 | Performance period | 1.26 | 9.5 | % | 1.86 | 20 | % | |||||||||||||
2008 | Performance period | 1.72 | 4 | % | 2.76 | 16 | % | |||||||||||||
2009 | Performance period | 1.01 | (5 | )% | 1.53 | 10 | % | |||||||||||||
2010 | Performance period | 0.82 | 0 | % | 1.44 | 13.5 | % |
(1) | Both the EPS and Average Annual Net Sales Growth criteria have an equal weight of 50%. | |
(2) | The EPS for 2007 plan: basic reported. The EPS for 2008 plan: diluted excluding special items. The EPS for 2009 and 2010 plans: diluted non-IFRS. |
Number of | Weighted | |||||||
performance | average grant | |||||||
shares at | date fair value | |||||||
threshold | EUR(2) | |||||||
Performance shares at January 1, 2008(5) | 13 554 558 | |||||||
Granted | 2 463 033 | 13.35 | ||||||
Forfeited | 690 909 | |||||||
Vested(3)(4)(6) | 7 291 463 | |||||||
Performance shares at December 31, 2008 | 8 035 219 | |||||||
Granted | 2 960 110 | 9.57 | ||||||
Forfeited | 691 325 | |||||||
Vested(5)(7) | 5 210 044 | |||||||
Performance shares at December 31, 2009 | 5 093 960 | |||||||
Granted | 3 576 403 | 5.94 | ||||||
Forfeited | 1 039 908 | |||||||
Vested(8) | 1 910 332 | |||||||
Performance shares at December 31, 2010 | 5 720 123 |
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(1) | Includes also performance shares granted under other than global equity plans. For further information see “Other equity plans for employees” below. | |
(2) | The fair value of performance shares is estimated based on the grant date market price of the Company’s share less the present value of dividends, if any, expected to be paid during the vesting period. | |
(3) | Based on the performance of the Group during the Interim Measurement Period2004-2005, under the 2004 Performance Share Plan, both performance criteria were met. Hence, 3 595 339 Nokia shares equaling the threshold number were delivered in 2006. The final payout, in 2008, was adjusted by the shares delivered based on the Interim Measurement Period. | |
(4) | Includes also performance shares vested under other than global equity plans. | |
(5) | Based on the performance of the Group during the Interim Measurement Period2005-2006, under the 2005 Performance Share Plan, both performance criteria were met. Hence, 3 980 572 Nokia shares equaling the threshold number were delivered in 2007. The performance shares related to the interim settlement of the 2005 Performance Share Plan are included in the number of performance shares outstanding at January 1, 2008 as these performance shares were outstanding until the final settlement in 2009. The final payout, in 2009, was adjusted by the shares delivered based on the Interim Measurement Period. | |
(6) | Includes performance shares under Performance Share Plan 2006 that vested on December 31, 2008. | |
(7) | Includes performance shares under Performance Share Plan 2007 that vested on December 31, 2009. | |
(8) | Includes performance shares under Performance Share Plan 2008 that vested on December 31, 2010. |
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Weighted | ||||||||
Number of | average grant | |||||||
Restricted | date fair value | |||||||
Shares | EUR(2) | |||||||
Restricted Shares at January 1, 2008 | 5 995 329 | |||||||
Granted(3) | 4 799 543 | 13.89 | ||||||
Forfeited | 358 747 | |||||||
Vested | 2 386 728 | |||||||
Restricted Shares at December 31, 2008 | 8 049 397 | |||||||
Granted | 4 288 600 | 7.59 | ||||||
Forfeited | 446 695 | |||||||
Vested | 2 510 300 | |||||||
Restricted Shares at December 31, 2009 | 9 381 002 | |||||||
Granted | 5 801 800 | 6.85 | ||||||
Forfeited | 1 492 357 | |||||||
Vested | 1 330 549 | |||||||
Restricted Shares at December 31, 2010(4) | 12 359 896 |
(1) | Includes also restricted shares granted under other than global equity plans. For further information see “Other equity plans for employees” below. | |
(2) | The fair value of restricted shares is estimated based on the grant date market price of the Company’s share less the present value of dividends, if any, expected to be paid during the vesting period. | |
(3) | Includes grants assumed under “NAVTEQ Plan” (as defined below). | |
(4) | Includes 849 800 restricted shares granted in Q4 2007 under Restricted Share Plan 2007 that vested on January 1, 2011. |
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25. | Deferred taxes |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Deferred tax assets: | ||||||||
Intercompany profit in inventory | 76 | 77 | ||||||
Tax losses carried forward | 388 | 263 | ||||||
Warranty provision | 82 | 73 | ||||||
Other provisions | 268 | 315 | ||||||
Depreciation differences and untaxed reserves | 782 | 796 | ||||||
Share-based compensation | 21 | 15 | ||||||
Other temporary differences | 447 | 320 | ||||||
Reclassification due to netting of deferred taxes | (468 | ) | (352 | ) | ||||
Total deferred tax assets | 1 596 | 1 507 | ||||||
Deferred tax liabilities: | ||||||||
Depreciation differences and untaxed reserves | (406 | ) | (469 | ) | ||||
Fair value gains/losses | (13 | ) | (67 | ) | ||||
Undistributed earnings | (353 | ) | (345 | ) | ||||
Other temporary differences(1) | (718 | ) | (774 | ) | ||||
Reclassification due to netting of deferred taxes | 468 | 352 | ||||||
Total deferred tax liabilities | (1 022 | ) | (1 303 | ) | ||||
Net deferred tax assets | 574 | 204 | ||||||
The tax charged to equity: | (1 | ) | (13 | ) |
(1) | In 2010, other temporary differences include a deferred tax liability of EUR 542 million (EUR 744 million in 2009) arising from purchase price allocation related to Nokia Siemens Networks and NAVTEQ. |
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26. | Accrued expenses and other liabilities |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Social security, VAT and other taxes | 1 585 | 1 808 | ||||||
Wages and salaries | 619 | 474 | ||||||
Deferred revenue | 786 | 231 | ||||||
Advance payments | 1 172 | 546 | ||||||
Other | 3 203 | 3 445 | ||||||
Total | 7 365 | 6 504 | ||||||
27. | Provisions |
IPR | Project | |||||||||||||||||||||||||||
Warranty | Restructuring | infringements | losses | Tax | Other | Total | ||||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
At January 1, 2009 | 1 375 | 356 | 343 | 245 | 460 | 813 | 3 592 | |||||||||||||||||||||
Exchange differences | (13 | ) | — | — | — | — | — | (13 | ) | |||||||||||||||||||
Additional provisions | 793 | 268 | 73 | 269 | 139 | 344 | 1 886 | |||||||||||||||||||||
Change in fair value | — | — | — | — | — | (1 | ) | (1 | ) | |||||||||||||||||||
Changes in estimates | (178 | ) | (62 | ) | (9 | ) | (63 | ) | (325 | ) | (174 | ) | (811 | ) | ||||||||||||||
Charged to profit and loss account | 615 | 206 | 64 | 206 | (186 | ) | 169 | 1 074 | ||||||||||||||||||||
Utilized during year | (1 006 | ) | (378 | ) | (17 | ) | (254 | ) | 0 | (280 | ) | (1 935 | ) | |||||||||||||||
At December 31, 2009 | 971 | 184 | 390 | 197 | 274 | 702 | 2 718 | |||||||||||||||||||||
IPR | Project | |||||||||||||||||||||||||||
Warranty | Restructuring | infringements | losses | Tax | Other | Total | ||||||||||||||||||||||
EURm | EURm | EURm | EURm | EURm | EURm | EURm | ||||||||||||||||||||||
At January 1, 2010 | 971 | 184 | 390 | 197 | 274 | 702 | 2 718 | |||||||||||||||||||||
Exchange differences | 40 | — | — | — | — | — | 40 | |||||||||||||||||||||
Additional provisions | 888 | 228 | 106 | 239 | 40 | 238 | 1 739 | |||||||||||||||||||||
Changes in estimates | (43 | ) | (44 | ) | (15 | ) | (52 | ) | (13 | ) | (87 | ) | (254 | ) | ||||||||||||||
Charged to profit and loss account | 845 | 184 | 91 | 187 | 27 | 151 | 1 485 | |||||||||||||||||||||
Utilized during year | (928 | ) | (173 | ) | (32 | ) | (177 | ) | (5 | ) | (338 | ) | (1 653 | ) | ||||||||||||||
At December 31, 2010 | 928 | 195 | 449 | 207 | 296 | 515 | 2 590 | |||||||||||||||||||||
2010 | 2009 | |||||||
EURm | EURm | |||||||
Analysis of total provisions at December 31: | ||||||||
Non-current | 837 | 841 | ||||||
Current | 1 753 | 1 877 |
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27. | Provisions (Continued) |
28. | Earnings per share |
2010 | 2009 | 2008 | ||||||||||
Numerator/EURm | ||||||||||||
Basic/Diluted: | ||||||||||||
Profit attributable to equity holders of the parent | 1 850 | 891 | 3 988 | |||||||||
Denominator/1000 shares | ||||||||||||
Basic: | ||||||||||||
Weighted average shares | 3 708 816 | 3 705 116 | 3 743 622 | |||||||||
Effect of dilutive securities: | ||||||||||||
Performance shares | 324 | 9 614 | 25 997 | |||||||||
Restricted shares | 4 110 | 6 341 | 6 543 | |||||||||
Stock options | — | 1 | 4 201 | |||||||||
4 434 | 15 956 | 36 741 | ||||||||||
Diluted: | ||||||||||||
Adjusted weighted average and assumed conversions | 3 713 250 | 3 721 072 | 3 780 363 | |||||||||
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28. | Earnings per share (Continued) |
29. | Commitments and contingencies |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Collateral for our own commitments | ||||||||
Property under mortgages | 18 | 18 | ||||||
Assets pledged | 5 | 13 | ||||||
Contingent liabilities on behalf of Group companies | ||||||||
Other guarantees | 1 262 | 1 350 | ||||||
Contingent liabilities on behalf of other companies | ||||||||
Other guarantees | 17 | 3 | ||||||
Financing commitments | ||||||||
Customer finance commitments(1) | 85 | 99 | ||||||
Venture fund commitments(2) | 238 | 293 |
(1) | See also note 35 b). | |
(2) | See also note 35 a). |
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29. | Commitments and contingencies (Continued) |
30. | Leasing contracts |
Operating | ||||
leases | ||||
Leasing payments, EURm | ||||
2011 | 285 | |||
2012 | 215 | |||
2013 | 160 | |||
2014 | 122 | |||
2015 | 82 | |||
Thereafter | 205 | |||
Total | 1 069 | |||
31. | Related party transactions |
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31. | Related party transactions (Continued) |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Transactions with associated companies | ||||||||||||
Share of results of associated companies | 1 | 30 | 6 | |||||||||
Dividend income | 1 | — | 6 | |||||||||
Share of shareholders’ equity of associated companies | 61 | 35 | 21 | |||||||||
Sales to associated companies | 15 | 8 | 59 | |||||||||
Purchases from associated companies | 186 | 211 | 162 | |||||||||
Receivables from associated companies | 3 | 2 | 29 | |||||||||
Liabilities to associated companies | 22 | 31 | 8 |
2010 | 2009 | 2008 | ||||||||||||||||||||||||||||||||||
Cash | Share-based | Cash | Share-based | Cash | Share-based | |||||||||||||||||||||||||||||||
Base | incentive | compensation | Base | incentive | compensation | Base | incentive | compensation | ||||||||||||||||||||||||||||
salary | payments | Expense | salary | payments | expense | salary | payments | expense | ||||||||||||||||||||||||||||
EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | EUR | ||||||||||||||||||||||||||||
Stephen Elop President and CEO from September 21, 2010 | 280 303 | 440 137 | 67 018 | — | — | — | — | — | — | |||||||||||||||||||||||||||
Olli-Pekka Kallasvuo President and CEO until September 20, 2010 | 979 758 | 676 599 | –2 455 999 | * | 1 176 000 | 1 288 144 | 2 840 777 | 1 144 800 | 721 733 | 1 286 370 |
* | The net negative share-based compensation expense of EUR 2 455 999 for Mr. Kallasvuo consisted of EUR 748 000 compensation for the fair market value of the 100 000 restricted Nokia shares granted to him in 2007, which were to vest on October 1, 2010, and reversal of the previously recognized share-based compensation expense, due to termination of Mr. Kallasvuo’s employment and forfeiture of his other equity grants. |
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31. | Related party transactions (Continued) |
2010 | 2010 | 2009 | 2009 | 2008 | 2008 | |||||||||||||||||||
Gross | Shares | Gross | Shares | Gross | Shares | |||||||||||||||||||
Annual Fee | Received | Annual Fee | Received | Annual Fee | Received | |||||||||||||||||||
EUR(1) | EUR(1) | EUR(1) | ||||||||||||||||||||||
Board of Directors | ||||||||||||||||||||||||
Jorma Ollila, Chairman | 440 000 | 20 710 | 440 000 | 16 575 | 440 000 | 9 499 | ||||||||||||||||||
Dame Marjorie Scardino, | 150 000 | 7 058 | 150 000 | 5 649 | 150 000 | 3 238 | ||||||||||||||||||
Vice Chairman | ||||||||||||||||||||||||
Georg Ehrnrooth(2) | — | — | 155 000 | 5 838 | 155 000 | 3 346 | ||||||||||||||||||
Lalita D. Gupte(3) | 140 000 | 6 588 | 140 000 | 5 273 | 140 000 | 3 022 | ||||||||||||||||||
Bengt Holmström | 130 000 | 6 117 | 130 000 | 4 896 | 130 000 | 2 806 | ||||||||||||||||||
Henning Kagermann | 130 000 | 6 117 | 130 000 | 4 896 | 130 000 | 2 806 | ||||||||||||||||||
Olli-Pekka Kallasvuo(4) | 130 000 | 6 117 | 130 000 | 4 896 | 130 000 | 2 806 | ||||||||||||||||||
Per Karlsson(5) | 155 000 | 7 294 | 155 000 | 5 838 | 155 000 | 3 346 | ||||||||||||||||||
Isabel Marey-Semper(6) | 140 000 | 6 588 | 140 000 | 5 273 | — | — | ||||||||||||||||||
Risto Siilasmaa(7) | 155 000 | 7 294 | 140 000 | 5 273 | 140 000 | 3 022 | ||||||||||||||||||
Keijo Suila(8) | 130 000 | 6 117 | 130 000 | 4 896 | 140 000 | 3 022 |
(1) | Approximately 40% of each Board member’s gross annual fee is paid in Nokia shares purchased from the market (included in the table under “Shares Received”) and the remaining approximately 60% of the gross annual fee is paid in cash. Further, it is Nokia policy that the directors retain all company stock received as director compensation until the end of their board membership, subject to the need to finance any costs relating to the acquisition of the shares, including taxes. | |
(2) | The 2009 and 2008 fees of Georg Ehrnrooth amounted to an annual total of EUR 155 000 each year indicated, consisting of a fee of EUR 130 000 for services as a member of the Board and EUR 25 000 for services as Chairman of the Audit Committee. | |
(3) | The 2010, 2009 and 2008 fees of Lalita Gupte amounted to an annual total of EUR 140 000 each year indicated, consisting of fee of EUR 130 000 for services as a member of the Board and EUR 10 000 for services as a member of the Audit Committee. | |
(4) | Olli-Pekka Kallasvuo left his position on the Nokia Board of Directors on September 10, 2010. This table includes fees paid to Olli-Pekka Kallasvuo for his services as a member of the Board, only. | |
(5) | The 2010, 2009 and 2008 fees of Per Karlsson amounted to an annual total of EUR 155 000 each year indicated, consisting of a fee of EUR 130 000 for services as a member of the Board and EUR 25 000 for services as Chairman of the Personnel Committee. | |
(6) | The 2010 and 2009 fees paid to Isabel Marey-Semper amounted to an annual total of EUR 140 000 each year indicated, consisting of a fee of EUR 130 000 for services as a member of the Board and EUR 10 000 for services as a member of the Audit Committee. | |
(7) | The 2010 fee of Risto Siilasmaa amounted to a total of EUR 155 000, consisting of fee of EUR 130 000 for service as a member of the Board and EUR 25 000 for service as Chairman of the Audit Committee. The 2009 and 2008 fees of Risto Siilasmaa amounted to an annual total of EUR 140 000 each year indicated, consisting of a fee of EUR 130 000 for services as a member of the Board and EUR 10 000 for services as a member of the Audit Committee. |
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31. | Related party transactions (Continued) |
(8) | The 2008 fee of Keijo Suila amounted to a total of EUR 140 000, consisting of a fee of EUR 130 000 for services as a member of the Board and EUR 10 000 for services as a member of the Audit Committee. |
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32. | Notes to cash flow statements |
2010 | 2009 | 2008 | ||||||||||
EURm | EURm | EURm | ||||||||||
Adjustments for: | ||||||||||||
Depreciation and amortization (Note 10) | 1 771 | 1 784 | 1 617 | |||||||||
(Profit) loss on sale of property, plant and equipment | ||||||||||||
andavailable-for-sale investments | (193 | ) | (111 | ) | (11 | ) | ||||||
Income taxes (Note 12) | 443 | 702 | 1 081 | |||||||||
Share of results of associated companies (Note 15) | (1 | ) | (30 | ) | (6 | ) | ||||||
Non-controlling interest | (507 | ) | (631 | ) | (99 | ) | ||||||
Financial income and expenses (Note 11) | 191 | 265 | 2 | |||||||||
Transfer from hedging reserve to sales and cost of sales (Note 21) | (22 | ) | 44 | (445 | ) | |||||||
Impairment charges (Note 8) | 110 | 1 009 | 149 | |||||||||
Asset retirements (Note 9, 13) | 37 | 35 | 186 | |||||||||
Share-based compensation (Note 24) | 47 | 16 | 74 | |||||||||
Restructuring charges | 245 | 307 | 448 | |||||||||
Settlement of a pension plan (Note 5) | — | — | 152 | |||||||||
Other income and expenses | (9 | ) | — | (124 | ) | |||||||
Adjustments, total | 2 112 | 3 390 | 3 024 | |||||||||
Change in net working capital | ||||||||||||
Decrease (Increase) in short-term receivables | 1 281 | 1 145 | (534 | ) | ||||||||
Decrease (Increase) in inventories | (512 | ) | 640 | 321 | ||||||||
(Decrease) Increase in interest-free short-term borrowings | 1 563 | (1 698 | ) | (2 333 | ) | |||||||
Loans made to customers | 17 | 53 | — | |||||||||
Change in net working capital | 2 349 | 140 | (2 546 | ) | ||||||||
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32. | Notes to cash flow statements (Continued) |
33. | Subsequent events |
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34. | Principal Nokia Group companies at December 31, 2010 |
Parent | Group | |||||||||||||
holding | majority | |||||||||||||
% | % | |||||||||||||
US | Nokia Inc. | — | 100.0 | |||||||||||
DE | Nokia GmbH | 100.0 | 100.0 | |||||||||||
GB | Nokia UK Limited | — | 100.0 | |||||||||||
KR | Nokia TMC Limited | 100.0 | 100.0 | |||||||||||
CN | Nokia Telecommunications Ltd | 4.5 | 83.9 | |||||||||||
NL | Nokia Finance International B.V. | 100.0 | 100.0 | |||||||||||
HU | Nokia Komárom Kft | 100.0 | 100.0 | |||||||||||
IN | Nokia India Pvt Ltd | 99.9 | 100.0 | |||||||||||
IT | Nokia Italia S.p.A | 100.0 | 100.0 | |||||||||||
ES | Nokia Spain S.A.U | 100.0 | 100.0 | |||||||||||
RO | Nokia Romania SRL | 100.0 | 100.0 | |||||||||||
BR | Nokia do Brazil Technologia Ltda | 99.9 | 100.0 | |||||||||||
RU | OOO Nokia | 100.0 | 100.0 | |||||||||||
US | NAVTEQ Corp | — | 100.0 | |||||||||||
NL | Nokia Siemens Networks B.V. | — | 50.0 | (1) | ||||||||||
FI | Nokia Siemens Networks Oy | — | 50.0 | |||||||||||
DE | Nokia Siemens Networks GmbH & Co KG | — | 50.0 | |||||||||||
IN | Nokia Siemens Networks Pvt. Ltd. | — | 50.0 |
(1) | Nokia Siemens Networks B.V., the ultimate parent of the Nokia Siemens Network group, is owned approximately 50% by each of Nokia and Siemens and consolidated by Nokia. Nokia effectively controls Nokia Siemens Networks as it has the ability to appoint key officers and the majority of the members of its Board of Directors, and accordingly, Nokia consolidated Nokia Siemens Networks. |
35. | Risk Management |
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35. | Risk Management (Continued) |
(a) | Market Risk |
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35. | Risk Management (Continued) |
2010 | USD | JPY | CNY | INR | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
FX derivatives used as cashflow hedges (net amount)(1) | (140 | ) | 521 | — | (23 | ) | ||||||||||
FX derivatives used as net investment hedges (net amount)(2) | (642 | ) | — | (2 834 | ) | (702 | ) | |||||||||
FX exposure from balance sheet items (net amount)(3) | (1 645 | ) | (245 | ) | (710 | ) | (218 | ) | ||||||||
FX derivatives not designated in a hedge relationship and carried at fair value through profit and loss (net amount)(3) | 26 | 645 | 2 129 | (95 | ) | |||||||||||
Cross currency / interest rate hedges | 408 | — | — | — |
2009 | USD | JPY | CNY | INR | ||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
FX derivatives used as cashflow hedges (net amount)(1) | (1 767 | ) | 663 | — | (78 | ) | ||||||||||
FX derivatives used as net investment hedges (net amount)(2) | (969 | ) | (6 | ) | (983 | ) | (208 | ) | ||||||||
FX exposure from balance sheet items (net amount)(3) | (464 | ) | (421 | ) | (1 358 | ) | 80 | |||||||||
FX derivatives not designated in a hedge relationship and carried at fair value through profit and loss (net amount)(3) | (328 | ) | 578 | 1 633 | (164 | ) | ||||||||||
Cross currency / interest rate hedges | 375 | — | — | — |
(1) | The FX derivatives are used to hedge the foreign exchange risk from forecasted highly probable cashflows related to sales, purchases and business acquisition activities. In some of the currencies, especially in US Dollar, Nokia has substantial foreign exchange risks in both estimated cash inflows and outflows, which have been netted in the table. See Note 21 for more details on hedge accounting. The underlying exposures for which these hedges are entered into are not presented in the table, as they are not financial instruments as defined under IFRS 7. | |
(2) | The FX derivatives are used to hedge the Group’s net investment exposure. The underlying exposures for which these hedges are entered into are not presented in the table, as they are not financial instruments as defined under IFRS 7. | |
(3) | The balance sheet items and some probable forecasted cash flows, which are denominated in foreign currencies, are hedged by a portion of FX derivatives not designated in a hedge relationship and carried at fair value through profit and loss. |
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35. | Risk Management (Continued) |
2010 | 2009 | |||||||||||||||
Fixed rate | Floating rate | Fixed rate | Floating rate | |||||||||||||
EURm | EURm | EURm | EURm | |||||||||||||
Assets | 8 795 | 3 588 | 5 712 | 3 241 | ||||||||||||
Liabilities | (4 156 | ) | (992 | ) | (3 771 | ) | (1 403 | ) | ||||||||
Assets and liabilities before derivatives | 4 639 | 2 596 | 1 941 | 1 838 | ||||||||||||
Interest rate derivatives | 1 036 | (994 | ) | 1 628 | (1 693 | ) | ||||||||||
Assets and liabilities after derivatives | 5 675 | 1 602 | 3 569 | 145 | ||||||||||||
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35. | Risk Management (Continued) |
• | FX exposures from outstanding balance sheet items and other FX derivatives carried at fair value through profit and loss, which are not in a hedge relationship and are mostly used for hedging balance sheet FX exposure. |
• | FX derivatives designated as forecasted cash flow hedges and net investment hedges. Most of the VaR is caused by these derivatives as forecasted cash flow and net investment exposures are not financial instruments as defined under IFRS 7 and thus not included in the VaR calculation. |
VaR from financial instruments | ||||||||
2010 | 2009 | |||||||
EURm | EURm | |||||||
At December 31 | 245 | 190 | ||||||
Average for the year | 223 | 291 | ||||||
Range for the year | 174-299 | 160-520 |
2010 | 2009 | |||||||
EURm | EURm | |||||||
At December 31 | 45 | 41 | ||||||
Average for the year | 43 | 33 | ||||||
Range for the year | 33-63 | 4-52 |
(b) | Credit Risk |
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35. | Risk Management (Continued) |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Financial guarantees given on behalf of customers and other third parties | — | — | ||||||
Loan commitments given but not used | 85 | 99 | ||||||
85 | 99 | |||||||
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35. | Risk Management (Continued) |
2010 | 2009 | |||||||
EURm | EURm | |||||||
Past due 1-30 days | 239 | 393 | ||||||
Past due31-180 days | 131 | 170 | ||||||
More than 180 days | 102 | 116 | ||||||
472 | 679 | |||||||
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35. | Risk Management (Continued) |
(1) | Fixed income and money-market investments include term deposits, investments in liquidity funds and investments in fixed income instruments classified asavailable-for-sale investments and investments at fair value through profit and loss. Liquidity funds invested solely in government securities are included under Governments. Other liquidity funds are included under Banks. |
(2) | Included within fixed income and money-market investments is EUR 37 million of restricted investment at December 31, 2010 (EUR 48 million at December 31, 2009). They are restricted financial assets under various contractual or legal obligations. |
(3) | Bank parent company ratings used here for bank groups. In some emerging markets countries, actual bank subsidiary ratings may differ from parent company rating. |
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35. | Risk Management (Continued) |
Nokia Corporation: | USD 1 923 million Revolving Credit Facility, maturing 2012 | |
Nokia Siemens Networks Finance B.V. and Nokia Siemens Networks Oy: | EUR 2 000 million Revolving Credit Facility, maturing 2012 |
Issuer(s): | Program | Issued | ||
Nokia Corporation: | Shelf registration statement on file with the US Securities and Exchange Commission | USD 1 500 million | ||
Nokia Corporation: | Local commercial paper program in Finland, totaling EUR 750 million | — | ||
Nokia Corporation: | US Commercial Paper (USCP) program, totaling USD 4 000 million | USD 500 million | ||
Nokia Corporation and Nokia Finance | ||||
International B.V.: | Euro Commercial Paper (ECP) program, totaling USD 4 000 million | — | ||
Nokia Siemens Networks Finance B.V.: | Local commercial paper program in Finland, totaling EUR 500 million | EUR 245 million |
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35. | Risk Management (Continued) |
Due between 3 | ||||||||||||||||||||
and | ||||||||||||||||||||
Due within | 12 | Due between 1 | Due between 3 | Due beyond | ||||||||||||||||
At 31 December 2010 | 3 months | months | and 3 years | and 5 years | 5 years | |||||||||||||||
EURm | EURm | EURm | EURm | EURm | ||||||||||||||||
Non-current financial assets | ||||||||||||||||||||
Available-for-sale investments | — | 3 | 3 | 35 | — | |||||||||||||||
Long-term loans receivable | — | — | 59 | 8 | 1 | |||||||||||||||
Other non-current assets | — | — | 2 | — | — | |||||||||||||||
Current financial assets | ||||||||||||||||||||
Current portion of long-term loans receivable | 9 | 33 | — | — | — | |||||||||||||||
Short-term loans receivable | — | 1 | — | — | — | |||||||||||||||
Investments at fair value through profit and loss | 10 | 18 | 322 | 44 | 1 043 | |||||||||||||||
Available-for-sale investment | 7 904 | 1 229 | 163 | 97 | 77 | |||||||||||||||
Cash | 1 951 | — | — | — | — | |||||||||||||||
Cash flows related to derivative financial assets net settled : | ||||||||||||||||||||
Derivative contracts — receipts | 72 | (53 | ) | 38 | 47 | (276 | ) | |||||||||||||
Cash flows related to derivative financial assets gross settled: | ||||||||||||||||||||
Derivative contracts — receipts | 14 136 | 3 718 | 456 | 123 | 253 | |||||||||||||||
Derivative contracts — payments | (14 075 | ) | (3 704 | ) | (457 | ) | (128 | ) | (247 | ) | ||||||||||
Accounts receivable(1) | 5 476 | 838 | 21 | — | — | |||||||||||||||
Non-current financial liabilities | ||||||||||||||||||||
Long-term liabilities | (119 | ) | (90 | ) | (839 | ) | (2 351 | ) | (2 596 | ) | ||||||||||
Current financial liabilities | ||||||||||||||||||||
Current portion of long-term loans | (2 | ) | (125 | ) | — | — | — | |||||||||||||
Short-term liabilities | (849 | ) | (73 | ) | — | — | — | |||||||||||||
Cash flows related to derivative financial liabilities net settled:(5) | ||||||||||||||||||||
Derivative contracts — payments | (3 | ) | — | — | 5 | 58 | ||||||||||||||
Cash flows related to derivative financial liabilities gross settled:(5) | ||||||||||||||||||||
Derivative contracts — receipts | 18 836 | 3 506 | 655 | 310 | 450 | |||||||||||||||
Derivative contracts — payments | (19 085 | ) | (3 545 | ) | (651 | ) | (295 | ) | (420 | ) | ||||||||||
Other financial liabilities(4) | (88 | ) | — | — | — | ��� | ||||||||||||||
Accounts payable | (5 942 | ) | (155 | ) | (9 | ) | — | — | ||||||||||||
Contingent financial assets and liabilities | ||||||||||||||||||||
Loan commitments given undrawn(2) | (27 | ) | (38 | ) | (20 | ) | — | — | ||||||||||||
Loan commitments obtained undrawn(3) | 50 | — | 3 355 | — | — |
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Due between 3 | ||||||||||||||||||||
Due within | and 12 | Due between 1 | Due between 3 | Due beyond | ||||||||||||||||
At 31 December 2009 | 3 months | months | and 3 years | and 5 years | 5 years | |||||||||||||||
EURm | EURm | EURm | EURm | EURm | ||||||||||||||||
Non-current financial assets | ||||||||||||||||||||
Long-term loans receivable | — | — | 36 | 6 | 4 | |||||||||||||||
Other non-current assets | — | — | 3 | 1 | 1 | |||||||||||||||
Current financial assets | ||||||||||||||||||||
Current portion of long-term loans receivable | 4 | 11 | — | — | — | |||||||||||||||
Short-term loans receivable | 1 | 1 | — | — | — | |||||||||||||||
Investments at fair value through profit and loss | 3 | 22 | 29 | 515 | 139 | |||||||||||||||
Available-for-sale investment | 6 417 | 322 | 290 | 110 | 116 | |||||||||||||||
Cash | 1 142 | — | — | — | — | |||||||||||||||
Cash flows related to derivative financial assets net settled : | ||||||||||||||||||||
Derivative contracts — receipts | 88 | (47 | ) | 80 | 110 | 27 | ||||||||||||||
Cash flows related to derivative financial assets gross settled: | ||||||||||||||||||||
Derivative contracts — receipts | 14 350 | 1 067 | — | — | — | |||||||||||||||
Derivative contracts — payments | (14 201 | ) | (1 037 | ) | — | — | — | |||||||||||||
Accounts receivable(1) | 5 903 | 1 002 | 73 | — | — | |||||||||||||||
Non-current financial liabilities | ||||||||||||||||||||
Long-term liabilities | (124 | ) | (96 | ) | (594 | ) | (2 973 | ) | (2 596 | ) | ||||||||||
Current financial liabilities | ||||||||||||||||||||
Current portion of long-term loans | (3 | ) | (41 | ) | — | — | — | |||||||||||||
Short-term liabilities | (628 | ) | (100 | ) | — | — | — | |||||||||||||
Cash flows related to derivative financial liabilities net settled:(5) | ||||||||||||||||||||
Derivative contracts — payments | (1 | ) | (4 | ) | (11 | ) | (3 | ) | 55 | |||||||||||
Cash flows related to derivative financial liabilities gross settled:(5) | ||||||||||||||||||||
Derivative contracts — receipts | 14 529 | 1 444 | 45 | 292 | 466 | |||||||||||||||
Derivative contracts — payments | (14 652 | ) | (1 455 | ) | (36 | ) | (279 | ) | (469 | ) | ||||||||||
Accounts payable | (4 873 | ) | (74 | ) | (3 | ) | — | — | ||||||||||||
Contingent financial assets and liabilities | ||||||||||||||||||||
Loan commitments given undrawn(2) | (59 | ) | (40 | ) | — | — | — | |||||||||||||
Loan commitments obtained undrawn(3) | — | — | 2 841 | — | — |
(1) | Accounts receivable maturity analysis does not include accrued receivables and receivables accounted based on the percentage of completion method of EUR 1 235 million (2009: EUR 1 004 million). | |
(2) | Loan commitments given undrawn have been included in the earliest period in which they could be drawn or called. | |
(3) | Loan commitments obtained undrawn have been included based on the period in which they expire. | |
(4) | Other financial liabilities in 2010 (EUR 0 million in 2009) include EUR 88 million non-derivative short term financial liabilities disclosed in Note 16. |
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(5) | In 2010 the Group has changed the presentation of certain derivatives from net settled to gross settled, to better reflect the nature of the contracts. The 2009 numbers have been aligned with the new presentation. The net cash flows for each time buckets remain the same. |
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By: | /s/ ANJA KORHONEN |
Title: | Senior Vice President, Corporate Controller |
By: | /s/ KAARINA STÅHLBERG |
Title: | Vice President, Assistant General Counsel |