Gordana Kovačević, the President of Ericsson Nikola Tesla commented on the Company’s performance:
“The Company’s focus on strategic projects, leadership in technology and partnership with customers has opened new business opportunities, primarily in export markets. The total sales revenue increased by 44.4% year-over-year as a result of the revenue growth in both the CIS and Ericsson markets. Sales in the domestic and regional markets witnessed a decrease, mainly due to the unfavorable economic trends, political instability in the markets of the region, but also due to cautious approach of customers to capital investments.
As of the CIS market, we signed contracts with the leading telecom operator in the Russian market, Rostelecom. The contracts cover a supply of the equipment for new mobile networks of the state-of-the-art technology and the network for various contents delivery to end users. These contracts are of the utmost importance for the Company and prove that the permanent market presence and listening to customer needs, in combination with leadership in technology and competent expert resources give positive results. This is the largest business achievement that Ericsson Nikola Tesla has made in the last several years. The contracts will be realized by the end of the year, thus enabling Rostelecom to become a converged operator being able to offer its users a wide range of converged services in the area of information and telecommunications in mobile and fixed networks throughout the Russian Federation.
Owing to investments into competencies and the advanced technological infrastructure, Ericsson Nikola Tesla’s Research and Development Center continuously expands its product portfolio and responsibilities at the global level. The revenues from research and development activities in the segment of advanced radio networks, platforms and fixed network servers, have witnessed continuous growth and represent a significant part of the total revenues.
In addition, I would like to underline that experts from the Service Delivery Center have been awarded new and comprehensive global responsibilities. The launching of the Global Competence Hub in Ericsson Nikola Tesla is a great credit to our employees, active in the segment of radio access networks (RAN). Their work and results through a regional service delivery center enabled them to be recognized as a team of exceptional competencies and professionalism.
Furthermore, we have achieved a considerable improvement in almost all key financial indicators. The operating profit has almost doubled year-over-year, and the net profit has increased by 116.8%. The strong cash flow from operating activities amounted to MHRK 172.3 and is a result of Company’s focus on maintaining a high level of liquid assets. Thus, the total financial assets, including short-term financial assets, amounted to MHRK 543.5 at the end of H1.
Simultaneously, in compliance with the Corporation and the Company strategy, we stick to the planned activities regarding the organizational and process transformation. We are especially focused on the market analysis, following up the impact of macroeconomic development and political uncertainty on customer investments. Taking into account the increased data traffic due to the increased number of smartphone subscribers, operators’ investments into hardware, software and services are necessary in order to ensure high network performance, Therefore, we develop new models of cooperation with partners and customers and continue to invest into competence development and encourage innovativeness”.
Communications Ericsson Nikola Tesla