27 March 2010

Nokia in 2009 - Review
By The Board of Directors 2009

Nokia has yesterday published "Nokia in 2009" that includes Nokia 2009 Annual Accounts, the Review by the Board of Directors.

In 2009, Nokia’s net sales decreased 19 % to EUR 40 984 million (EUR 50 710 million in 2008). Net sales of Devices & Services for 2009 decreased 21 % to EUR 27 853 million (EUR 35 099 million).

Net sales of NAVTEQ were EUR 670 million in 2009 (EUR 361 million for the six months ended December 31, 2008). Net sales of Nokia Siemens Networks decreased 18 % to EUR 12 574 million (EUR 15 309 million).

In 2009, Europe accounted for 36 % (37 %) of Nokia’s net sales, Asia-Pacific 22 % (22 %), Greater China 16 % (13 %), Middle East & Africa 14 % (14 %), Latin America 7 % (10 %), and North America 5 % (4 %). The 10 markets in which Nokia generated the greatest net sales in 2009 were, in descending order of magnitude, China, India, the UK, Germany, the United States, Russia, Indonesia, Spain, Brazil and Italy, together representing approximately 52 % of total net sales in 2009. In comparison, the 10 markets in which Nokia generated the greatest net sales in 2008 were China, India, the UK, Germany, Russia, Indonesia, the United States, Brazil, Italy and Spain, together representing approximately 50 % of total net sales in 2008.

Nokia’s gross margin in 2009 was 32.4 %, compared to 34.3 % in 2008. Nokia’s 2009 operating profit decreased 76 % to EUR 1 197million, compared with EUR 4 966 million in 2008. Nokia’s 2009 operating margin was 2.9 % (9.8 %). Nokia’s operating profit in 2009 included purchase price accounting items and other special items of net negative EUR 2 306 million (net negative EUR 2 067 million). Devices & Services operating profit decreased 43 % to EUR 3 314 million, compared with EUR 5 816 million in 2008, with a reported operating margin of 11.9 % (16.6 %). Devices & Services operating profit in 2009 included special items of negative EUR 174 million (net negative EUR 557 million).

NAVTEQ’s operating loss in 2009 was EUR 344 million with a reported operating margin of – 51.3 % compared to an operating loss of EUR 153 million, for the six months ended on December 31, 2008 representing an operating margin of – 42.4 %. NAVTEQ’s operating loss in 2009 included purchase price accounting items and other special items of negative EUR 465 million (net negative EUR 235 million). Nokia Siemens Networks had an operating loss of EUR 1 639 million, compared with a EUR 301 million operating loss in 2008, representing an operating margin of – 13.0 % (– 2.0 %).

Nokia Siemens Networks operating loss in 2009 included purchase price accounting items and other special items, including EUR 908 million impairment of goodwill, of net negative EUR 1 667 million (net negative EUR 1 058 million). In 2009, Nokia’s net sales and profitability were negatively impacted by the deteriorated global economic conditions, including weaker consumer and corporate spending, constrained credit availability and currency market volatility. The demand environment, in particular for mobile devices, improved during the latter part of the year as the global economy started showing initial signs of recovery.