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Electronics Production | January 22, 2010

ST-Ericsson post loss in Q4

Net sales was $740 million; 2% sequential increase for ST-Ericsson during the fourth quarter 2009.
Adjusted operating loss $50 million. Restructuring plans on track, additional $115 million savings announced in December.

President and CEO, Gilles Delfassy, commented: "In the fourth quarter, we gained further momentum in one of the fastest growing markets, China, where we are the clear leader in its standard TD-SCDMA, having delivered more than 6.5 million chipsets by the end of December 2009. In addition, we have taken further actions to improve our financial performance and increase our competitiveness.

Net sales reported a 2% sequential increase driven by continued demand in China. The operating loss of $50 million, excluding amortization of acquisition-related intangibles and restructuring charges, compares to a $77 million operating loss reported in the third quarter 2009 and it reflects reduced operating expenses.

Inventory management continued to produce positive results thanks to improved efficiency in the supply chain. Inventory declined by $33 million, reaching a level of $244 million at the end of the quarter.

Net cash was $229 million at the end of fourth quarter 2009, a sequential increase of $13 million, including improved working capital and a one-time payment of $53 million from parent companies related to final merger transaction adjustments already planned since the inception of the company.

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