OUTLOOK Sony Ericsson Q4 profits seen falling slightly on lower ASPs
STOCKHOLM, (Thomson Financial via COMTEX) -- ERICY | news | PowerRating | PR Charts -- Sony Ericsson Mobile Communications AB is expected to report on Wednesday Jan 16 a fall in fourth quarter pretax profit from a year earlier as the company's market share gains are offset by lower average selling prices (ASP).
The pretax result is seen coming in between 289 - 786 mln eur, with an average expectation of 469 mln eur, according to a survey of analysts by SME Direkt. This compares with 502 mln eur a year earlier.
Sales are seen little changed at 3.793 bln eur, versus 3.782 bln a year earlier.
ASP is seen falling to 121 eur from 146 eur, while the company's market share of the global handset market is expected to have increased slightly to 9.6 pct in the fourth quarter from 9.0 pct a year earlier.
"Sales will be a touch lower from last year, one reason is difficult comparisons, they had a very strong second half to 2006," Jan Dworksi, Sony Ericsson analyst at Handelsbanken, "Overall their market share is little changed but they have lost some market share in Asia, and particularly in Japan which is more important for them than for the industry as a whole".
Dworksi has said ASPs have fallen as part of an industry wide phenomenon, but Sony Ericsson's have fallen further than most as they company traditionally sold its products at a premium to the industry average. The company has also increased its product offering.
"They have expanded their proposition into cheaper products," said Jan Dworksi.
On results day he said the key factors determining the market's reaction to the report will - apart from pretax profit - be ASP, market share, margins and the company's outlook statement for the coming year.
Sony Ericsson's profits are equally distributed between its two owners Sony Corp and LM Ericsson AB
The pretax result is seen coming in between 289 - 786 mln eur, with an average expectation of 469 mln eur, according to a survey of analysts by SME Direkt. This compares with 502 mln eur a year earlier.
Sales are seen little changed at 3.793 bln eur, versus 3.782 bln a year earlier.
ASP is seen falling to 121 eur from 146 eur, while the company's market share of the global handset market is expected to have increased slightly to 9.6 pct in the fourth quarter from 9.0 pct a year earlier.
"Sales will be a touch lower from last year, one reason is difficult comparisons, they had a very strong second half to 2006," Jan Dworksi, Sony Ericsson analyst at Handelsbanken, "Overall their market share is little changed but they have lost some market share in Asia, and particularly in Japan which is more important for them than for the industry as a whole".
Dworksi has said ASPs have fallen as part of an industry wide phenomenon, but Sony Ericsson's have fallen further than most as they company traditionally sold its products at a premium to the industry average. The company has also increased its product offering.
"They have expanded their proposition into cheaper products," said Jan Dworksi.
On results day he said the key factors determining the market's reaction to the report will - apart from pretax profit - be ASP, market share, margins and the company's outlook statement for the coming year.
Sony Ericsson's profits are equally distributed between its two owners Sony Corp and LM Ericsson AB
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