Positive outlook for Ericsson despite second quarter loss

Telecoms equipment supplier Ericsson has reported a net loss of SEK2.7 billion (USD327 million) for the second quarter of 2002, unchanged from the previous period and better than expectations, following an aggressive cost cutting programme undertaken in the three months. The company said that it would return to profit by the end of the year, indicating that it had finally put the financial crisis of the telecoms equipment market behind it. Ericsson said that its principal systems business had returned to the black in the quarter, reporting a SEK600 million profit following five consecutive quarters of being in the red. Sales for the quarter stood at SEK27.6 billion, a 28% fall year-on-year, but 7% up on the first quarter of 2003. The promising results boosted the company’s share price by 12% to SEK9.80.