Nortel Networks yesterday reported earnings of $US477 million or 72 cents per share, for the fourth quarter that ended December 31, 1998.
The earnings, which excluded one-time gains, charges, and costs related to the acquisition of Bay Networks, beat the mean estimate of 70 cents per share made by financial analysts polled by First Call. The company's earnings grew 23 per cent from the fourth quarter of 1997, in which it made $386 million.
Including acquisition-related costs of $820 million, one-time pretax gains of $30 million and one time pretax charges of $27 million, the company lost $341 million or 51 cents per share for the fourth quarter. Nortel acquired Bay Networks last June.
Nortel's revenues for the quarter were $5.77 billion, up 20 per cent from $4.81 billion in the same period a year earlier.
For the year, Nortel's net earnings were $1.07 billion, or $1.86 per share, compared with $804 million, or $1.54 per share, in 1997. Revenues from ongoing operations for the year increased 16 per cent over 1997 to $17.58 billion. Including the one-time charges, gains, and acquisition costs, the company posted a loss of $569 million, or 99 cents per share, for 1998.
Nortel reported 26 per cent growth in its enterprise networks business as a result of the Bay merger, and 14 per cent growth in carrier networks in 1998. Revenues from the US increased 34 per cent, while those in Europe grew 19 per cent. In Canada, revenues grew 16 per cent over 1997. In Latin America and Asia Pacific, the revenue growth declined 15 per cent.