Alcatel posts 2013 loss, to sell enterprise unit

Reuters News
Posted: Feb 06, 2014 1:00 AM

PARIS (Reuters) - Telecom equipment maker Alcatel-Lucent posted a net loss of 1.3 billion euros ($1.76 billion) last year hit by a writedown on its mobile business and restructuring costs, showing the uphill climb it faces in its long-awaited turnaround.

The company also announced on Thursday that it was in talks to sell 75 percent of its enterprise business, which sells communications products and services to corporations, to investment fund China Huaxin.

The potential transaction prices Alcatel-Lucent Enterprise at 268 million euros on an enterprise value basis.

Alcatel Chief Executive Michel Combes, who took over in April 2013, has pledged 1 billion euros in asset sales through 2015. He has lifted investor hopes and led the stock to quadruple last year.

Revenue in the fourth quarter was flat at 3.93 billion euros, but the gross margin improved amid aggressive cost cutting to reach 34 percent, leading to net income of 134 million euros.

Analysts had on average forecast fourth-quarter sales of 4.16 billion euros, a gross margin of 32 percent, and an adjusted net loss of 31.5 million, according to Thomson One data.

($1 = 0.7390 euros)

(Reporting by Leila Abboud and Gwenaelle Barzic; Editing by James Regan)