Alcatel-Lucent Shares Slide On Margin, Cash Woes |
| Wall Street Journal - Nov 4, 2010 |
Shares in Franco-U.S. telecom equipment maker Alcatel-Lucent SA (ALU.FR) tumbled Thursday on concerns about the group's margins and cash generation and despite a return to year-on-year revenue growth for the first time in over two years.
At 1424 GMT, its shares were trading down 6.6% at EUR2.37, the biggest loser in a higher Paris market.
Bernstein analyst Pierre Ferragu said cash generation is weak and likely to remain a drag that could turn into a "real long-term worry," while Credit Suisse noted that the group's margin target looks "increasingly challenging."
Even though Alcatel-Lucent swung to an adjusted operating profit of EUR61 million in the third quarter compared with a loss of EUR11 million in the same period a year ago, it missed expectations. The adjusted operating margin of 1.5% also fell short of hopes.
The figures are adjusted for charges such as costs associated with the 2006 merger of Alcatel with Lucent Technologies.
The company burnt EUR297 million of cash in the quarter.
Read Full Article from Wall Street Journal
- Posted: 2010-11-04 10:36:01
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