PARIS (AP) — Alcatel-Lucent saw its losses more than double in the second quarter as the French-American telecommunications gear maker booked financial charges worth hundreds of millions of euros against the shrinking value of its assets.
Paris-based Alcatel-Lucent, which supplies networking equipment to telecom operators such as AT&T and Verizon, said Tuesday it made an 885 million euros ($1.17 billion) loss during the period, compared with the previous year's equivalent 396 million euros.
The company, which got rid of its CEO earlier this year after a failed five-year bid to return Alcatel-Lucent to profitability, blamed the losses on a 552 million euro "impairment charge" following a review of its assets; a 194 million euro restructuring charge; and 180 million euros in financial losses, mainly arising from the cost of interest on its debt.
New chief executive Michel Combes took over from former CEO Ben Verwaayen earlier this year. The Frenchman finds himself in a similar predicament to the one that faced his Dutch predecessor when he was brought in to try to save Alcatal-Lucent in 2008.
Last month Combes unveiled "The Shift", the latest in a series of restructuring plans in the seven years since Alcatel-Lucent was formed in a trans-Atlantic merger.
As part of the new strategy, the company is planning to make 1 billion euros in fixed cost savings and asset sales of more than 1 billion euros over 2013-2015. The company, which once sought a return to profit by 2011, no longer sets a public target date for a return to profit.
"We are at the beginning of our journey towards 2015 and cash remains a challenge," Combes said.