SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a -16 or 15d -16 of
the Securities Exchange Act of 1934
Report on Form 6-K dated July 18, 2002
Nokia Corporation
Nokia House
Keilalahdentie 4
02150 Espoo
Finland
(Name and address of registrant's principal executive office)
(Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F __X__ Form 40-F _____
-----
Enclosure: Press release dated July 18, 2002: "NOKIA 2Q PROFITS AND
MARGINS UP-- REVENUES IN LINE WITH GUIDANCE"
Page 1 of 15 Total Pages
NOKIA PRESS RELEASE 1 (13)
July 18, 2002
NOKIA 2Q PROFITS AND MARGINS UP
- -- REVENUES IN LINE WITH GUIDANCE
Second quarter 2002 compared with second quarter 2001:
- Net sales decreased 6% to EUR 6 935 million (EUR 7 346 million
in 2Q 2001)
- Pro forma operating profit increased to EUR 1 260 million (EUR 1
137 million); pro forma operating margin increased to 18.2%
(15.5%)
- Reported operating profit increased to EUR 1 221 million (EUR
856 million): reported operating margin increased to 17.6%
(11.7%)
- Pro forma adjustments: EUR 52 million in goodwill amortization
and a EUR 13 million positive adjustment related to the earlier
Dolphin write-off in 3Q 2001
- Pro forma earnings per share (diluted) increased to EUR 0.19
(EUR 0.17)
- Reported (IAS) net profit increased to EUR 862 million (EUR 589
million) and reported earnings per share (diluted)
increased to EUR 0.18 (EUR 0.12)
- Operating cash flow increased to EUR 1 410 million (EUR 790
million)
JORMA OLLILA, CHAIRMAN AND CEO:
Thanks to our consistent record of strong execution and tight cost control, we
were able to put in a solid second quarter. Pro forma operating profit, in
particular, showed year-on-year growth of 11%, generating a very strong
operating cash flow of EUR 1.4 billion. In mobile phones, we saw pro forma
operating profit grow by 22%. For these achievements in a difficult environment
my thanks go to the whole Nokia team.
During the quarter, our winning product portfolio brought further gains in
mobile phone market share, which rose both sequentially and year on year to over
38%. We also expect our full-year 2002 market share to show an increase on last
year's 37%.
Shipments of the new Symbian-based Nokia 7650 camera and PDA phone began in
Europe and Asia Pacific, with priority given to markets where operators have
already launched their MMS services. Initial feedback from customers and users
across the board has been extremely positive.
As we enter the second half we are seeing a clear and concrete shift.
Feature-rich multimedia products with color screens offering compelling new
services are now in the hands of consumers. We also see this driving demand as
consumers and business people, motivated by new communications possibilities,
move to upgrade their existing phones or even look towards owning more than one
device.
Nokia is preparing for a string of new product launches for the remainder of the
year, including a major step in September with the introduction of our first
dual-mode WCDMA/GSM phone and our first 3G network. Depending on operator
schedules in WCDMA networks, we expect the 3G business system to be mature
enough for commercial handset shipments by early 2003.
Interoperability is requisite for the success of advanced mobile services and
our industry is supporting this through the Open Mobile Alliance. In the last
few months, a lot of progress has been made to ensure that technologies and
services function together for consumers on any network and terminal.
Economic conditions in the latter part of the year will continue to be hard. We
see ourselves as very competitively positioned to lead the industry into the
next mobile communications growth phase.
Page 2 of 15 Total Pages
NOKIA SECOND QUARTER 2002 / FIRST HALF 2002 FINANCIAL RESULTS 2 (13)
- ----------------------------------------- ------------------------------------- -----------------------------------
2Q 2002 PRO FORMA REPORTED
(excludes goodwill amortization
and non-recurring items)
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
EUR (million) 2Q/2002 2Q/2001 Change (%) 2Q/2002 2Q/2001 Change (%)
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
Net sales 6 935 7 346 -6 6 935 7 346 -6
Nokia Mobile Phones 5 398 5 349 1 5 398 5 349 1
Nokia Networks 1 474 1 896 -22 1 474 1 896 -22
Nokia Ventures Organization 106 134 -21 106 134 -21
Operating profit 1 260 1 137 11 1 221 856 43
Nokia Mobile Phones 1 171 960 22 1 148 902 27
Nokia Networks 171 300 -43 161 240 -33
Nokia Ventures Organization -63 -92 32 -69 -255 73
Common Group Expenses -19 -31 -19 -31
Operating Margin (%) 18.2 15.5 17.6 11.7
Nokia Mobile Phones (%) 21.7 17.9 21.3 16.9
Nokia Networks (%) 11.6 15.8 10.9 12.7
Nokia Ventures Organization (%) -59.4 -68.7 -65.1 -190.3
Financial income and expenses 39 27 44 39 27 44
Profit before tax and 1 292 1 166 11 1 253 885 42
minority interests
Net profit 905 830 9 862 589 46
EPS, EUR
Basic 0.19 0.18 6 0.18 0.13 38
Diluted 0.19 0.17 12 0.18 0.12 50
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
- ----------------------------------------- ------------------------------------- -----------------------------------
1H 2002 PRO FORMA REPORTED
(excludes goodwill amortization
and non-recurring items)
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
EUR (million) 1H/2002 1H/2001 Change (%) 1H/2002 1H/2001 Change (%)
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
Net sales 13 949 15 353 -9 13 949 15 353 -9
Nokia Mobile Phones 10 836 11 179 -3 10 836 11 179 -3
Nokia Networks 2 910 3 918 -26 2 910 3 918 -26
Nokia Ventures Organization 263 303 -13 263 303 -13
Operating profit 2 546 2 577 -1 2 455 2 225 10
Nokia Mobile Phones 2 379 2 167 10 2 333 2 085 12
Nokia Networks 317 664 -52 283 585 -52
Nokia Ventures Organization -93 -194 52 -104 -385 73
Common Group Expenses -57 -60 -57 -60
Operating Margin (%) 18.3 16.8 17.6 14.5
Nokia Mobile Phones (%) 22.0 19.4 21.5 18.7
Nokia Networks (%) 10.9 16.9 9.7 14.9
Nokia Ventures Organization (%) -35.4 -64.0 -39.5 -127.1
Financial income and expenses 74 74 - 74 74 -
Profit before tax and 2 605 2 651 -2 2 514 2 299 9
minority interests
Net profit 1 820 1 876 -3 1 725 1 564 10
EPS, EUR
Basic 0.38 0.40 -5 0.36 0.33 9
Diluted 0.38 0.39 -3 0.36 0.33 9
- ----------------------------------------- ------------- ----------- ----------- ----------- ----------- -----------
*All figures can be found in the tables on pages 6-13
Page 3 of 15 Total Pages
BUSINESS ENVIRONMENT AND FORECASTS 3 (13)
Nokia's second-quarter sales declined by 6% compared with the second quarter
2001. Sales for Nokia Mobile Phones grew by 1% compared with the previous year,
reflecting growth in Asia Pacific and Europe, offset by lower sales in the
Americas. Sales for Nokia Networks showed a year-on-year decline of 22%, with
continued lower-than-expected 2G investments in China and Europe, partially
offset by steady growth in the US.
Accelerated 3Q and 2H sales growth
Sales for the Nokia group in the third quarter 2002 are anticipated to be in the
range of EUR 7.2 billion to EUR 7.6 billion, compared with EUR 7.0 billion in
the third quarter 2001. Overall sales growth for the second half is then
estimated to be between 3% and 10%. Sales growth will be driven by volume
deliveries of a number of advanced high value-added models during the second
half and revenue recognized from 3G network sales, assuming the necessary
technology milestones are satisfied.
Profitability outlook strong
Nokia's profitability outlook remains strong, reflecting the company's
operational efficiencies and cost control. Third-quarter pro forma earnings per
share (diluted) is expected to be in the range of EUR 0.15 to EUR 0.17.
Management expects to see full-year pro forma earnings per share (diluted) in
the range of EUR 0.79 to EUR 0.84.
Pro forma operating margins for Nokia Mobile Phones are expected to continue at
around 20% for the second half of 2002, with the fourth quarter being stronger
than the third. Nokia Networks pro forma operating margins are estimated to
remain at approximately the 10% level for the rest of the year, while Nokia
Ventures Organization is expected to post a pro forma loss of around EUR 150
million for 2002.
Full-year handset market estimate about 400 million
Nokia estimates full-year 2002 market volume at about 400 million units sold.
All regions are estimated to show growth of approximately 5% led by the Americas
and Asia-Pacific and followed by Europe.
Nokia's mobile phone sales volume in the second quarter of 2002 increased year
on year by 12% to about 36 million. This clearly outpaced overall market volume,
which is estimated to have grown by about 4% to around 93 million units.
Year-on-year overall market volume growth was strongest in the Americas followed
by Europe, while Asia-Pacific declined slightly, largely due to slow replacement
sales in Japan and South Korea. GSM clearly continues to be the largest cellular
standard. During the first half, GSM and CDMA showed modest growth, while TDMA
remained flat and the Japanese PDC market declined.
Second half network market developments
Based on second-quarter developments, Nokia continues to expect an annual
decline in the GSM and overall infrastructure market in 2002. Major operators in
Europe and Asia are scheduled to start their multimedia messaging services
during the second half 2002.
Customer financing
At the end of June, outstanding long-term customer loans totaled EUR 1 555
million (EUR 1 128 million at December 31, 2001), while guarantees given on
behalf of third parties totaled EUR 121 million (EUR 127 million). In addition,
Nokia had financing commitments totaling EUR 2 542 million (EUR 2 955 million).
Of the total committed and outstanding customer financing at the end of June,
EUR 3 569 million (EUR 3 607 million) related to 3G networks.
Nokia's German operator customer MobilCom, to which the company has provided
long-term financing of EUR 752 million, is currently restructuring its
financing. These arrangements may involve vendor participation in the form of
rescheduling or other restructuring of financing terms. Discussions are ongoing
as to the exact nature of the restructuring. An agreement is expected to lead to
a reassessment of the valuation of Nokia's current MobilCom receivables or any
alternative security through a charge of a material portion of such receivables
against earnings during the third quarter of 2002. This charge would be excluded
from pro forma earnings.
Page 4 of 15 Total Pages
NOKIA MOBILE PHONES 4 (13)
During the first six months of 2002, Nokia Mobile Phones announced and started
shipping a record 20 new mobile phone models. The company plans to announce and
ship further new phones during the second half, bringing the full-year total of
new products shipping to more than 30.
During the second quarter, Nokia started shipping 12 new phones, representing
several different product categories in Nokia's mobile phone portfolio, and
incorporating a number of key enabling technologies. These included the Nokia
7650, the company's first imaging model with an integrated VGA resolution
digital camera for multimedia messaging. Running on the Symbian Operating
System, the Nokia 7650 includes both GPRS and HSCSD connections, WAP and email,
Bluetooth and infrared, and MIDP Java(TM) support.
Other breakthrough deliveries were the Nokia 6370, the company's first CDMA/1X
model for North America, and the first mass-volume GPRS and MMS-enabled GSM
model, the Nokia 3510, which began shipping in Europe and Asia Pacific. Another
volume GSM model, the Nokia 3410 with Java(TM), started shipping in Europe. In
June, Nokia started deliveries of a new China-specific model, the Nokia 3610,
and in July commenced shipments of its first GAIT (GSM/TDMA) model, the Nokia
6340 in the US.
The current quarter will bring further key deliveries, such as the tri-band GSM
models: the Nokia 7210 and 6610, both with Java(TM), MMS and color displays, as
well as the Nokia 6590 and 3590 for GSM 850/1900/GPRS in the Americas,
supporting XHTML.
Nokia welcomes the formation of the 200-member Open Mobile Alliance, providing
new impetus for the next industry growth phase. The alliance is working to
ensure interoperable services across countries, networks and handsets through
open standards and platforms.
In order to accelerate this unprecedented move towards a global, interoperable
mobile services market, Nokia is licensing its Series 60 smartphone software to
other manufacturers. During the quarter, Series 60 licensing agreements were
signed with Matsushita and Siemens. The Nokia Series 60 incorporates key
enabling technologies, such as MMS and Java(TM).
NOKIA NETWORKS
In WCDMA and EDGE network infrastructure, Nokia is delivering 3G equipment in 23
countries to 42 operators, of which 26 are in full commercial volume deliveries.
The value of inventory related to work in progress on 3G amounted to EUR 686
million at the end of June. During the quarter, the company was selected as a 3G
radio network supplier to mmO2 in the UK, Germany and Ireland. Nokia also signed
contracts with Hutchison 3G Austria to supply its 3G core network and with
Radiolinja in Finland for its 2G and 3G radio and core networks.
Major operators in Europe and Asia are scheduled to start their multimedia
messaging services during the second half, 2002. Nokia was selected as a
supplier of multimedia messaging infrastructure by several operators, including
TIM in Italy, the Telefonica Moviles Group, mmO2 across its European markets and
M1 in Singapore.
Nokia signed GSM contracts with eight operators, including a GSM/GPRS/EDGE radio
network expansion contract with AT&T Wireless, further strengthening the
position of GSM technology in the US market.
NOKIA VENTURES ORGANIZATION
Nokia Ventures Organization continued to identify and develop new business
opportunities for Nokia. A modest recovery in the VPN and firewall security
appliance market continued to carry over into the second quarter for Nokia
Internet Communications. The unit was further strengthened by a record number of
new product announcements, entry into the small office security appliance
segment, the launch of the Nokia Security Developers Alliance program and
ongoing solution bundling with strategic partners: Check Point Software
Technologies, ISS and F5. Nokia Venture Partners opened an office in South Korea
and made its first investment in the Asia Pacific region.
Page 5 of 15 Total Pages
NOKIA IN JANUARY-JUNE 2002 REPORTED 5 (13)
Second quarter 2002
(International Accounting Standards (IAS) comparisons given to the second
quarter 2001 results unless otherwise indicated)
Nokia's net sales decreased by 6% to EUR 6 935 million (EUR 7 346 million).
Sales of Nokia Mobile Phones increased by 1% to EUR 5 398 million (EUR 5 349
million). Sales of Nokia Networks decreased by 22% to EUR 1 474 million (EUR 1
896 million). Sales of Nokia Ventures Organization decreased by 21% and totaled
EUR 106 million (EUR 134 million).
Operating profit increased by 43% to EUR 1 221 million (EUR 856 million),
representing an operating margin of 17.6% (11.7%). Operating profit in Nokia
Mobile Phones increased by 27% to EUR 1 148 million (EUR 902 million),
representing an operating margin of 21.3% (16.9%). Operating profit in Nokia
Networks decreased by 33% to EUR 161 million (EUR 240 million), representing an
operating margin of 10.9% (12.7%). Nokia Ventures Organization reported an
operating loss of EUR 69 million (operating loss of EUR 255 million). Common
Group Expenses, which comprises Nokia Head Office and Nokia Research Center,
totaled EUR 19 million (EUR 31 million).
Financial income totaled EUR 39 million (EUR 27 million). Profit before tax and
minority interests was EUR 1 253 million (EUR 885 million). Net profit totaled
EUR 862 million (EUR 589 million). Earnings per share increased to EUR 0.18
(basic) and to EUR 0.18 (diluted) compared with EUR 0.13 (basic) and EUR 0.12
(diluted) in the second quarter 2001.
First half 2002
(IAS comparisons given to the first half 2001 results unless otherwise
indicated)
Nokia's net sales decreased by 9% to EUR 13 949 million (EUR 15 353 million).
Sales of Nokia Mobile Phones decreased by 3% to EUR 10 836 million (EUR 11 179
million). Sales of Nokia Networks decreased by 26% to EUR 2 910 million (EUR 3
918 million). Sales of Nokia Ventures Organization decreased by 13% and totaled
EUR 263 million (EUR 303 million).
Operating profit increased by 10% to EUR 2 455 million (EUR 2 225 million),
representing an operating margin of 17.6% (14.5%). Operating profit in Nokia
Mobile Phones increased by 12% to EUR 2 333 million (EUR 2 085 million),
representing an operating margin of 21.5% (18.7%). Operating profit in Nokia
Networks decreased by 52% to EUR 283 million (EUR 585 million), representing an
operating margin of 9.7% (14.9%). Nokia Ventures Organization reported an
operating loss of EUR 104 million (operating loss of EUR 385 million). Common
Group Expenses, which comprises Nokia Head Office and Nokia Research Center,
totaled EUR 57 million (EUR 60 million).
Financial income totaled EUR 74 million (EUR 74 million). Profit before tax and
minority interests was EUR 2 514 million (EUR 2 299 million). Net profit totaled
EUR 1 725 million (EUR 1 564 million). Earnings per share increased to EUR 0.36
(basic) and to EUR 0.36 (diluted) compared with EUR 0.33 (basic) and EUR 0.33
(diluted) in the first half 2001.
The average number of employees during the first half was 53 028. At June 30,
Nokia employed a total of 52 970 people (53 849 people at December 31, 2001).
At June 30, 2002, net debt-to-equity ratio (gearing) was -42% (-41% at December
31, 2001). During the January to June period in 2002, capital expenditures
amounted to EUR 262 million (EUR 625 million).
On June 30, the Group companies owned 1 077 797 Nokia shares. The shares had an
aggregate par value of EUR 64 667.82, representing 0.02% of the share capital of
the company and the total voting rights. The number of issued shares on June 30
was 4 753 226 997 and the share capital was EUR 285 193 619.82.
Page 6 of 15 Total Pages
6 (13)
CONSOLIDATED PROFIT AND LOSS ACCOUNT, EUR million
(unaudited)
Pro forma Pro forma Reported, IAS Reported, IAS
4-6/02 4-6/01 4-6/02 4-6/01
- ---------------------------------------------------------------------------------------------------------------------------
Net sales 6,935 7,346 6,935 7,346
Cost of sales 1) -4,052 -4,556 -4,052 -4,627
Research and development expenses -779 -794 -779 -794
Selling, general and administrative expenses 2) -844 -859 -844 -998
Adjustment to Dolphin write-off 3) - - 13 -
Amortization of goodwill - - -52 -71
----------------------------------------------------------------------
Operating profit 1,260 1,137 1,221 856
Share of results of associated companies -7 2 -7 2
Financial income and expenses 39 27 39 27
----------------------------------------------------------------------
Profit before tax and minority interests 1,292 1,166 1,253 885
----------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Tax -377 -303 -381 -263
Minority interests -10 -33 -10 -33
----------------------------------------------------------------------
Net profit 905 830 862 589
----------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Earnings per share, EUR
Basic 0.19 0.18 0.18 0.13
Diluted 0.19 0.17 0.18 0.12
Average number of shares (1,000 shares)
Basic 4,745,947 4,694,648 4,745,947 4,694,648
Diluted 4,784,745 4,788,099 4,784,745 4,788,099
- ---------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization, total 322 360
Non-recurring items
1) Non-recurring charges of EUR 71 million from 2Q 2001.
2) In 2001, non-recurring charges of EUR 139 million, including a EUR 54 million
impairment of goodwill, and a EUR 24 million gain from the disposal of certain
production operations from 2Q 2001.
3) Positive adjustment of EUR 13 million related to the earlier Dolphin
write-off in 3Q 2001.
Page 7 of 15 Total Pages
7 (13)
CONSOLIDATED PROFIT AND LOSS ACCOUNT, EUR million
(unaudited)
Pro forma Pro forma Reported, IAS Reported, IAS
1-6/02 1-6/01 1-6/02 1-6/01
- ---------------------------------------------------------------------------------------------------------------------------
Net sales 13,949 15,353 13,949 15,353
Cost of sales 1) -8,296 -9,584 -8,296 -9,655
Research and development expenses -1,482 -1,560 -1,482 -1,560
Selling, general and administrative expenses 2) -1,625 -1,632 -1,625 -1,771
Adjustment to Dolphin write-off 3) - - 13 -
Amortization of goodwill - - -104 -142
----------------------------------------------------------------------
Operating profit 2,546 2,577 2,455 2,225
Share of results of associated companies -15 - -15 -
Financial income and expenses 74 74 74 74
----------------------------------------------------------------------
Profit before tax and minority interests 2,605 2,651 2,514 2,299
----------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Tax -755 -721 -759 -681
Minority interests -30 -54 -30 -54
----------------------------------------------------------------------
Net profit 1,820 1,876 1,725 1,564
----------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
Earnings per share, EUR
Basic 0.38 0.40 0.36 0.33
Diluted 0.38 0.39 0.36 0.33
Average number of shares (1,000 shares)
Basic 4,741,230 4,693,933 4,741,230 4,693,933
Diluted 4,793,896 4,788,474 4,793,896 4,788,474
- ---------------------------------------------------------------------------------------------------------------------------
Depreciation and amortization, total 635 673
Non-recurring items
1) Non-recurring charges of EUR 71 million from 2Q 2001.
2) In 2001, non-recurring charges of EUR 139 million, including a EUR 54 million
impairment of goodwill, and a EUR 24 million gain from the disposal of certain
production operations from 2Q 2001. 3) Positive adjustment of EUR 13 million
related to the earlier Dolphin write-off in 3Q 2001.
Page 8 of 15 Total Pages
8 (13)
CONSOLIDATED PROFIT AND LOSS ACCOUNT, EUR million
(unaudited)
Pro forma Reported, IAS
1-12/01 1-12/01
- -------------------------------------------------------------------------------------------------------------------
Net sales 31,191 31,191
Cost of sales 1) -19,693 -19,787
Research and development expenses -2,985 -2,985
Selling, general and administrative expenses 2) -3,276 -3,443
One-time customer finance charges 3) - -714
Impairment of minority investments - -80
Impairment of goodwill - -518
Amortization of goodwill - -302
------------------------------------------
Operating profit 5,237 3,362
Share of results of associated companies -12 -12
Financial income and expenses 125 125
------------------------------------------
Profit before tax and minority interests 5,350 3,475
------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Tax -1,478 -1,192
Minority interests -83 -83
------------------------------------------
Net profit 3,789 2,200
------------------------------------------
- -------------------------------------------------------------------------------------------------------------------
Earnings per share, EUR
Basic 0.81 0.47
Diluted 0.79 0.46
Average number of shares (1,000 shares)
Basic 4,702,852 4,702,852
Diluted 4,787,219 4,787,219
- -------------------------------------------------------------------------------------------------------------------
Depreciation and amortization, total 1,430
Non-recurring items
1) Includes non-recurring charges of EUR 71 million from 2Q and EUR 23 million
from 4Q.
2) Includes non-recurring charges of EUR 85 million from 2Q, including a EUR 24
million gain from the disposal of certain production operations, and a total of
EUR 82 million from 4Q.
3) Includes one-time customer finance charges from 3Q.
Page 9 of 15 Total Pages
9 (13)
NET SALES BY BUSINESS GROUP, EUR million
(unaudited)
4-6/02 4-6/01 1-6/02 1-6/01 1-12/01
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Mobile Phones 5,398 5,349 10,836 11,179 23,158
Nokia Networks 1,474 1,896 2,910 3,918 7,534
Nokia Ventures Organization 106 134 263 303 585
Inter-business group eliminations -43 -33 -60 -47 -86
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Group 6,935 7,346 13,949 15,353 31,191
- -----------------------------------------------------------------------------------------------------------------------------
OPERATING PROFIT BY BUSINESS GROUP, EUR million
(unaudited)
Pro forma 4-6/02 4-6/01 1-6/02 1-6/01 1-12/01
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Mobile Phones 1,171 960 2,379 2,167 4,648
Nokia Networks 171 300 317 664 1,073
Nokia Ventures Organization -63 -92 -93 -194 -327
Common Group Expenses -19 -31 -57 -60 -157
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Group 1,260 1,137 2,546 2,577 5,237
- -----------------------------------------------------------------------------------------------------------------------------
Goodwill amortization 4-6/02 4-6/01 1-6/02 1-6/01 1-12/01
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Mobile Phones -23 -23 -46 -47 -92
Nokia Networks -23 -19 -47 -38 -105
Nokia Ventures Organization -6 -29 -11 -57 -105
Common Group Expenses - - - - -
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Group -52 -71 -104 -142 -302
- -----------------------------------------------------------------------------------------------------------------------------
Non-recurring items 4-6/02 4-6/01 1-6/02 1-6/01 1-12/01
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Mobile Phones - -35 - -35 -35
Nokia Networks 13 -41 13 -41 -1,041
Nokia Ventures Organization - -134 - -134 -423
Common Group Expenses - - - - -74
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Group 13 -210 13 -210 -1,573
- -----------------------------------------------------------------------------------------------------------------------------
Reported, IAS 4-6/02 4-6/01 1-6/02 1-6/01 1-12/01
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Mobile Phones 1,148 902 2,333 2,085 4,521
Nokia Networks 161 240 283 585 -73
Nokia Ventures Organization -69 -255 -104 -385 -855
Common Group Expenses -19 -31 -57 -60 -231
- -----------------------------------------------------------------------------------------------------------------------------
Nokia Group 1,221 856 2,455 2,225 3,362
- -----------------------------------------------------------------------------------------------------------------------------
Page 10 of 15 Total Pages
10 (13)
CONSOLIDATED BALANCE SHEET, IAS, EUR million (unaudited)
ASSETS 30.6.02 30.6.01 31.12.01
Fixed assets and other non-current assets
Capitalized development costs 1,012 751 893
Goodwill 751 1,057 854
Other intangible assets 223 278 237
Property, plant and equipment 2,140 2,715 2,514
Investments in associated companies 67 62 49
Available-for-sale investments 356 408 399
Deferred tax assets 894 504 832
Long-term loans receivable 1,555 964 1,128
Other non-current assets 40 60 6
----------------------------------------------------
7,038 6,799 6,912
----------------------------------------------------
Current assets
Inventories 1,828 1,897 1,788
Accounts receivable 4,671 4,711 5,719
Prepaid expenses and accrued income 1,423 1,793 1,480
Short-term loans receivable 554 243 403
Available-for-sale investments 5,026 2,674 4,271
Bank and cash 1,386 1,501 1,854
----------------------------------------------------
14,888 12,819 15,515
----------------------------------------------------
Total assets 21,926 19,618 22,427
----------------------------------------------------
SHAREHOLDERS' EQUITY AND LIABILITIES
Shareholders' equity
Share capital 285 282 284
Share issue premium 2,096 1,704 2,060
Treasury shares -20 -150 -21
Translation differences 251 380 326
Fair value and other reserves 44 -114 20
Retained earnings 9,987 8,893 9,536
----------------------------------------------------
12,643 10,995 12,205
----------------------------------------------------
Minority interests 218 218 196
----------------------------------------------------
Long-term liabilities
Long-term interest-bearing liabilities 176 161 207
Deferred tax liabilities 195 62 177
Other long-term liabilities 71 65 76
----------------------------------------------------
442 288 460
----------------------------------------------------
Current liabilities
Short-term borrowings 859 1,187 831
Current portion of long-term debt 25 47 -
Accounts payable 2,508 1,966 3,074
Accrued expenses 2,985 3,002 3,477
Provisions 2,246 1,915 2,184
----------------------------------------------------
8,623 8,117 9,566
----------------------------------------------------
Total shareholders' equity and liabilities 21,926 19,618 22,427
----------------------------------------------------
Interest-bearing liabilities 1,060 1,395 1,038
Shareholders' equity per share, EUR 2.66 2.34 2.58
- -----------------------------------------------------------------------------------------------------------------------
Number of shares (1000 shares) * 4,752,149 4,695,441 4,736,302
- -----------------------------------------------------------------------------------------------------------------------
Dividends to Nokia's shareholders, EUR 1,279 million (EUR 1,314 million in
2001), were deducted from retained earnings and recorded within accrued expenses
as a liability at the end of 1Q both in 2002 and 2001. Dividends were paid in
April and had an impact on cash flow and gearing in the second quarter.
* Shares owned by Group companies are excluded
Page 11 of 15 Total Pages
11 (13)
CONSOLIDATED CASH FLOW STATEMENT, IAS, EUR million
1-6/02 1-6/01 1-12/01
Cash flow from operating activities
Net profit 1,725 1 ,564 2,200
Adjustments, total 1,371 1,393 4,132
-------------------------------------------------
Net profit before change in net working capital 3,096 2,957 6,332
Change in net working capital 226 246 978
--------------------------------------------------
Cash generated from operations 3,322 3,203 7,310
Interest received 126 146 226
Interest paid -30 -45 -155
Other financial income and expenses 21 -11 99
Income taxes paid -1,121 -780 -933
--------------------------------------------------
Net cash from operating activities 2,318 2,513 6,547
Cash flow from investing activities
Acquisition of Group companies, net of acquired cash - -143 -131
Purchase of non-current available-for-sale investments -80 -93 -323
Additions in capitalized development costs - -194 -431
-221
Long-term loans made to customers -426 -213 -1,129
Proceeds from (+), payment (-) of other long-term receivables 1 -36 84
Proceeds from (+), payment (-) of short-term loan receivables -184 45 -114
Capital expenditures -261 -625 -1,041
Proceeds from disposal of Group companies,
net of disposed cash 105 - -
Proceeds from sale of non-current available-for-sale investments 3 98 204
Proceeds from sale of fixed assets 128 206 175
Dividends received 25 27 27
--------------------------------------------------
Net cash used in investing activities -910 -928 -2,679
Cash flow from financing activities
Proceeds from share issue 51 12 77
Purchase of treasury shares -13 - -21
Capital investment by minority shareholders 26 2 4
Proceeds from long-term borrowings 6 -8 102
Repayment of long-term borrowings -11 -59
Proceeds from (+), payment of (-) short-term borrowings 90 -282 -602
Dividends paid -1,308 -1,339 -1,396
--------------------------------------------------
Net cash used in financing activities -1,159 -1,615 -1,895
--------------------------------------------------
Foreign exchange impact on cash -50 22 -43
Net increase in cash and cash equivalents 199 -8 1,930
Cash and cash equivalents at beginning of period 6,125 4,183 4,183
--------------------------------------------------
Cash and cash equivalents at end of period 6,324 4,175 6,113
==================================================
Change in net fair value of current available-for-sale
Investments 88 12
--------------------------------------------------
As reported on balance sheet 6,412 4,175 6,125
--------------------------------------------------
NB: Figures in the consolidated cash flow statement cannot be directly traced
from the balance sheet without additional information as a result of
acquisitions and disposals of subsidiaries and net foreign exchange differences
arising on consolidation.
Page 12 of 15 Total Pages
12 (13)
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY, EUR million (unaudited)
Share Share Treasury Translation Fair value Retained Total
capital Issue shares Differences and other earnings
Premium reserves
- ------------------------------------------------------------------------------------------------------------------------------
Balance at December 31, 2000 282 1,695 -157 347 - 8,641 10,808
- ------------------------------------------------------------------------------------------------------------------------------
Effect of adopting IAS 39 -56 -56
- ------------------------------------------------------------------------------------------------------------------------------
Balance at January 1, 2001, restated 282 1,695 -157 347 -56 8,641 10,752
- ------------------------------------------------------------------------------------------------------------------------------
Share issue 11 11
Reissuance of treasury shares 7 7
Stock options issued on acquisitions 4 4
Stock options exercised
related to acquisitions -6 -6
Dividend -1,314 -1 314
Translation differences 134 134
Net investment hedge gains/ (losses) -101 -101
Cash flow hedges and available-for-sale investments -58 -58
Other increase/decrease, net 2 2
Net profit 1,564 1,564
- ------------------------------------------------------------------------------------------------------------------------------
Balance at June 30, 2001 282 1,704 -150 380 -114 8,893 10,995
- ------------------------------------------------------------------------------------------------------------------------------
Balance at December 31, 2001 284 2,060 -21 326 20 9,536 12,205
- ------------------------------------------------------------------------------------------------------------------------------
Share issue 1 49 50
Acquisition of treasury shares -13 -13
Reissuance of treasury shares 14 14
Stock options exercised
related to acquisitions -13 -13
Dividend -1,279 -1,279
Translation differences -84 -84
Net investment hedge gains/ (losses) 9 9
Cash flow hedges 87 87
Available-for-sale investments -63 -63
Other increase/decrease, net 5 5
Net profit 1,725 1,725
- ------------------------------------------------------------------------------------------------------------------------------
Balance at June 30, 2002 285 2,096 -20 251 44 9,987 12,643
- ------------------------------------------------------------------------------------------------------------------------------
COMMITMENTS AND CONTINGENCIES, EUR million
(unaudited) GROUP
30.6.02 30.6.01 31.12.01
Collateral for own commitments
Mortgages 18 12 18
Assets pledged 13 4 4
Collateral given on behalf of other companies
Assets pledged 37 24 33
Contingent liabilities on behalf of Group companies
Other guarantees 389 662 505
Contingent liabilities on behalf of other companies
Guarantees for loans 85 153 95
Other guarantees
Leasing obligations 722 1,151 1,246
Page 13 of 15 Total Pages
13 (13)
NOTIONAL AMOUNTS OF DERIVATIVE FINANCIAL INSTRUMENTS, EUR million 1)
(unaudited)
30.6.02 30.6.01 31.12.01
Foreign exchange forward contracts 2) 3) 18,606 9,242 20,978
Currency options bought 524 1,723 1,328
Currency options sold 758 1,631 1,209
Interest rate swaps - 51 -
Cash settled equity swaps 4) 122 278 182
1) The notional amounts of derivatives summarized here do not represent amounts
exchanged by the parties and, thus are not a measure of the exposure of Nokia
caused by its use of derivatives.
2) Notional amounts outstanding include positions, which have been closed off.
3) Notional amount includes contracts used to hedge the net investments in
foreign subsidiaries.
4) Cash settled equity swaps are used to hedge risks relating to incentive
programs and investments activities.
Closing rate: 1 EUR = 0.946 USD
It should be noted that certain statements herein which are not historical
facts, including, without limitation those regarding A) the timing of product
deliveries; B) our ability to develop and implement new products and
technologies; C) expectations regarding market growth and developments; D)
expectations for growth and profitability; and E) statements preceded by
"believe," "expect," "anticipate," "foresee" or similar expressions, are
forward-looking statements. Because these statements involve risks and
uncertainties, actual results may differ materially from the results that we
currently expect. Factors that could cause these differences include, but are
not limited to: 1) developments in the mobile communications market including
the continued development of the replacement market and the Company's success in
the 3G market; 2) demand for products and services; 3) market acceptance of new
products and service introductions; 4) the availability of new products and
services by operators; 5) weakened economic conditions in many of the Company's
principal markets; 6) pricing pressures; 7) intensity of competition; 8) the
impact of changes in technology; 9) consolidation or other structural changes in
the mobile communications market; 10) the success and financial condition of the
Company's partners, suppliers and customers; 11) the management of the Company's
customer financing exposure; 12) the continued success of product development by
the Company; 13) the continued success of cost-efficient, effective and flexible
manufacturing by the Company; 14) the ability of the Company to source component
production and R&D without interruption and at acceptable prices; 15) inventory
management risks resulting from shifts in market demand; 16) fluctuations in
exchange rates, including, in particular, the fluctuations in the euro exchange
rate between the US dollar and the Japanese yen; 17) impact of changes in
government policies, laws or regulations; 18) the risk factors specified on
pages 10 to 17 of the Company's Form 20-F for the year ended December 31, 2001.
NOKIA
Helsinki, July 18, 2002
For more information:
Lauri Kivinen, Corporate Communications, tel. +358 7180 34495
Ulla James, Investor Relations, tel. +1 972 894 4880
Antti Raikkonen, Investor Relations, tel. +358 7180 34290
www.nokia.com
- - Nokia plans mid-quarter updates on September 10 and December 10, 2002.
- - Results announcements for 3Q, and 4Q 2002 are planned for October 17 and
January 23, respectively.
Page 14 of 15 Total Pages
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant, Nokia Corporation, has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
Date: July 18, 2002 Nokia Corporation
By: /s/ Ursula Ranin
-------------------------------
Name: Ursula Ranin
Title: Vice President, General Counsel
Page 15 of 15 Total Pages