Alcatel-Lucent aims to compete with the best
February 21, 2012 – 1:05 pmAlcatel-Lucent can now aspire to eventually reach the same level of profitability that the best class in the sector of telecom equipment, said its managing director Ben Verwaayen.
This aspiration may seem ambitious for a group whose time some investors doubted the chances of survival and that has cleared its first profits than last year, five years after the merger of its two entities.
Although he admits that all the targets were not achieved, Ben Verwaayen suggests that the company has turned a corner after three years of restructuring designed to make a business group "normal".
"Did we talk to our customers on the question of our future? No. On one of our financial future? No. It's over, "he said in an interview with Reuters
. Even if he fails any forecast figures beyond 2012, the leader, of Dutch origin and former boss of BT operators, spares no ambitions for Alcatel-Lucent ….
….. "We see some of our colleagues in the industry achieve double digit returns," said Ben Verwaayen …….
.. "By definition, it is therefore in the art of the possible (…) Between where we are today and these figures, there is a road we must travel in the coming years. "
The march will be high to cross yet
. Alcatel-Lucent
generated an operating margin of 3.9% last year, compared to 11.6% while Sweden's Ericsson China's Huawei has reached the figure of 15.8% in 2010.
The Franco-American group said a target margin improvement this year, but without providing any numerical target, so it set a horizon of 5 to 9% % in terms of margin in its three-year recovery.
"That was before the crisis, said Ben Verwaayen. What is the art of the possible for the sector given the changing conditions and competitive environment is slightly different in 2012 than it was in 2009. " According
industry experts, telecom operators could tighten the purse strings this year as the de gradation of the economy at the expense of telecom equipment
. STILL A WAY TO DO …….
. In this difficult context, the group has to work extra hard to complete its turnaround plan that was originally scheduled to expire at the end of 2011
. At the end
it was set to become a business "normal" – growing, profitable and generates cash – Alcatel-Lucent is in fact also a way to go
. "We have almost reached all our goals. We do our best to make sure it is completed by the end of 2012, "assured Ben Verwaayen, who gave up the granting of stock options and performance shares for 2012 ….
….. "I had the feeling of not completing the contract, he said. The share price was heckled during the year and I thought it was the right decision. "
. ……. Led by Ben Verwaayen, the group has made significant progress in overcoming weaknesses in the mobile with its product offering in the 4G enabled him to win major contracts in the U.S., with AT & T and Verizon in particular
. It also cut its costs to the extent of one billion euros in order to lower its equilibrium level, notably by hiring a rationalization of its product portfolio.
These developments were greeted with the stock market euphoria during the first part of 2011, before the cold shower of third quarter results which showed a high consumption of liquidity , reviving concerns about its cash and dropping the title.
In the fourth quarter, the group partly reassured by stopping the bleeding of its cash, which caused a surge this time of the action Alcatel.
"The response was overwhelming as every time," said Ben Verwaayen. "I think this demonstrates that the market is still nervous about us."
Finally, the action Alcatel has lost 44.6% of its value in 2011, signing one of the worst performances of the CAC 40 index.
The group in 2012 will rely on the proceeds of the sale of its Genesys nugget for $ 1.5 billion (945 million) as well as a license agreement designed to monetize its patent portfolio .
"We will be more robust in 2012," predicts Ben Verwaayen, the group expects a high level of positive net cash at the end of this year.
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