Nokia Profit may fall 49% as pressure grows on combined goal

April 20, 2011, 3: 40 pm EDT by Diana ben-Aaron

(Updates with share today trade in the sixth paragraph).

April 20 (Bloomberg)--Nokia Oyj may tomorrow report a decrease of 49 per cent of profit and forecast further erosion before that big manufacturer the most mobile phones introduced its first smartphones using the operating system of Microsoft Corp...Income net in the first quarter Nokia based in Espoo, Finland can fall to 177 million euros ($253 million) of 349 million euros a year earlier, on the average of 19 Analyst estimates compiled by Bloomberg. For devices and services adjusted for certain items probably operating margin fell by 3.6 percentage points to 8.5%, the average of 23 estimates shows.Director General Stephen Elop, a former leader of Microsoft, said in February Nokia adopting Windows Phone 7 Microsoft operating system main smartphone, replacement of the Symbian platform he used more than 10 years. Investors want to know how long it will take to achieve the objective of $ 150 million of sale more combined on the latest versions of Symbian. "I will be not in the second quarter or the slope of the down - eventually be lower than the first quarter and thus implicitly the pit depth could be resumed until we get a new product-based"," said Stuart Jeffrey, an analyst from Nomura International Plc, London, which has a rating on the stock "reduce".MarginNokia of operation did not provide a year full forecast, citing uncertainty caused during the transition to Microsoft software. On 11 February, the day, he announced the agreement, Elop as a long-term objective to increase combined sales faster than the market with an operating margin adjusted 10 percent or after the transition to Windows Phone morethat he is expected to take place in 2011 and 2012.The shares added 7.5 cents or 1.3%, 1066mhz euros to 10: 30 a.m. Helsinki, valuing the company at EUR 21.9 billion. Before today, Nokia has lost 29 percent since announcing the partnership of Microsoft.Investisseurs will look for guidance on how much combined time margins will remain below the level of 10.9% last year and what will be the reorganized company.Job losses?Elop has predicted "substantial reductions" in jobs cuts analysts say may reduce one third of the euro 3 billion annual budget of the research and development. "As the current portfolio of Symbian matures and actually begins to expire without any new device Windows coming out in the near future, I think that the second half and in the third quarter specifically could be veryvery difficult, "said Mikko Ervasti, an analyst based in Helsinki at Evli Bank.Symbian market share, to 37.6% in 2010, will fall to 19.2 per cent this year and 5.2% in 2012, according to forecasts by researcher Gartner Inc., which measure sales to consumers." In the fourth quarter, Nokia has a share of smartphone of 30.8%, down 20 percentage since Apple Inc. points has shipped its first iPhone in 2007, according to Gartner.Apple, Sony EricssonApple, which presents the results today, can be said profit rose 64 percent to 5.03 billion on sales 23.4 billion. In the first quarter of Nokia forecast for devices and sales services is EUR 6.8 billion to 7.3 billion euros, with a margin in devices operating, adjusted restructuring charges and depreciation of assets acquired, from 7 to 10%.Sony Ericsson Mobile Communications Ltd., which moved to Android's Symbian the last year, reported yesterday a profit of EUR 11 million surprise after the company has sold high - combined price.Nokia will report earnings to approximately 1 local time tomorrow, with a conference call at 3 a.m., which can be monitored through the Web site. "My sense is that the temptation will be strong enough to sink Elop - this quarter - trying to set a clear canvas by saying that it is possible that we could be down 20 percent from year to year in unit shipments, "said Lee Simpson, an analyst at Jefferies International Ltd. London.N8 SmartphoneNokia of the device in the first quarter shipments, usually lower, probably dragged company 1.6% from a year earlier to 106.1 million units, according to analysts surveyed by Bloomberg." Portfolio during the quarter included phone touchscreen N8 that he used to release a Symbian improved in September, with three related models, including the C7, which T-Mobile USA sells as probably Astound .first-quarter income has increased by 6.5% to 10.14 billion euros, the average 39 estimates, as deployed Nokia in new models more operators and markets.Android, IPhone5Nokia last week released an update for Symbian and two smartphones to ship in the summer, when they are likely to compete with the iPhone of Apple 5 and the latest models running the system Android from Google Inc. from vendorsincluding Samsung Electronics Co., seller of second combined of the world and HTC Corp., the Taiwanese manufacturer who spent Nokia in the market value of this month.Gartner predicts that android will run on 38.5% and smartphones sold this year. Google software moves in less expensive hardware and begins to compete with the high volume, low margin phones company composed of half of Nokia handset revenues and 78% of its unit sales last year. "Investors will want to get a sense of how much time will a Symbian tail, the speed with which it will ramp down,"stated Stephen Patel, an analyst based in San Francisco to Gleacher & Co."It will depend on the reaction of consumers to Nokia going end-of-life with Symbian. "Some don't care and others want to buy a product that is not going to be around a few years."Japan EffectInvestors will also look for advice on knowledge if after the earthquake in Japan last month will affect shipments in the second and third quarters, Patel said, adding that disruptions, it could offset the usual seasonal increase. "" I will be the potential impact of the Japan, particularly in terms of supply chain, the potential bottlenecks and margins - or non-deterioration during the last year, we have seen will continue ", said Leon Cappaert, a Fund Manager of KBC Asset Management in Brussels with 330 million euros under managementincluding shares of Nokia into a General Fund for weighting purposes.

-Editors: Kenneth Wong, Rob Valpuesta.

To contact the reporter on this story: Diana ben-Aaron in Helsinki at dbenaaron1@bloomberg.net

To contact the editor responsible for this story: Kenneth Wong in Berlin at the kwong11@bloomberg.net

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China's economy grows more than the forecast 9.7% as prices Jump

4: 26 Pm EDT by Bloomberg News, April 15, 2011

April 15 (Bloomberg)--the Chinese economy grew more - that - estimated 9.7% in the first quarter and the inflation in March has accelerated the fastest rate since 2008, adding to pressure for further monetary tightening.

Consumer prices increased by 5.4% a year earlier, the Statistics Office, said at a Conference in Beijing today. The median forecast in surveys of Bloomberg News, economists have been for the growth of 9.4% and the inflation of 5.2%.The Central Bank can stimulate reserve requirements for lenders, as early as this evening to drain liquidity in important economy the fastest-growing, Credit Agricole CIB and & Australia New Zealand Banking Group, said. Data of today can also add pressure increase of interest rates and more rapid appreciation in the yuan after foods and fresh products drove inflation higher than the target of the Government for a third month 2011. "" There is little economic moderation despite monetary tightening is aggressive, ", said Li-Gang Liu, Economist ANZ in Hong Kong, who previously worked for the World Bank. "Inflation remains a high risk."The report of the reserve is 20% for the largest banks and the reference of one year for borrowing costs is 6.31 percent after four rate increases since mid-October. The growth was 9.8% in the fourth quarter of last year.Index of Composite closed Shanghai 0.3 per cent higher. The yuan has varied little at 6.5295 per dollar as of 3: 27 pm, local time.Pressures Asian InflationInflation across Asia have been highlighted by India reports today a jump from 8.98% greater than the forecast of the index of the prices of wholesale in March of the previous year.Data release today in China confirmed numbers circulating yesterday, including a report of Phoenix television. The statistics bureau condemned any leaks and said offenders will be punished.Investment in assets other than rural households has increased by 25% in the first quarter a year earlier and industrial production soared 15 percent in March, the statistics bureau, said. Retail sales grew an annual 17 percent in March and production price has jumped to 7.3%, showed the report today.Officials must evaluate the "lagging effects" of monetary policy to avoid future injury of the economy, Prime Minister Wen Jiabao said this week. China International Capital Corp., most large investment bank of China, warned that the growth of corporate earnings may slow as the economy cools in the coming months. "Inflationary pressures" may influence consumption in China, Pierre Bouchut, financial agent for Carrefour SA, second retailer in the world, said analysts yesterday. "CostsInflation of commodities was mainly due to costs of food, which increased by 12% in March from the previous year. The leaders of Brazil, Russia, India, China and South Africa said at a meeting in Sanya, China, yesterday that the volatile commodity prices pose a threat to the global economy, asking more than regulation.Non-food inflation accelerated to 2.7 per cent, while reserves a jump in Exchange China at a world record $ 3 trillion, reported yesterday, said the additional risk that capital inflows could fuel inflation.Taming the price is the top Government and "urgent" priority, China's cabinet, said after the meeting in Beijing this week to examine the performance of the world's second economy. Officials aim to contain inflation to 4% for the entire year. The tightening measures and comparisons with the year more high-bases earlier can slow down the earnings of prices in the second half of the year, according to the HSBC Holdings Plc.The economy increased by 2.1% over the previous quarter, seasonally adjusted, bureau of statisticssaid today, releasing this number for the first time. Comparing with a 2.4 percentage gain in the fourth quarter. Consumer prices have slipped 0.2% in March, February.Wen on YuanThe Central Bank may increase the flexibility of the yuan to "eliminate the monetary conditions that fuel inflation," Wen said this week. The Chinese currency is described by the United States as undervalued and a factor of global economic imbalances. "" It would be very advantageous to allow the currency to appreciate as a means of controlling inflation, "billionaire investor George Soros, Chairman of Soros Fund Management LLC, said at a Conference in Bretton Woods, New Hampshire, April 10. He described inflation as "a little out of control."Investors have reported the confidence that the fastest growing major economy will achieve a landing soft called, with controlled inflation and expansion continued. Stock market index of the reference of Shanghai Advanced 8% in the three months through today, compared to a 2% decrease in the cabinet of the MSCI Asia Pacific Index.China this week, said this property rising prices in many cities and of rising inflation expectations are the key concerns as the nation wrestling to the following a record 17.5 billion yuan ($2.7 billion) of loans plus 2009 and 2010.Rating CutFitch ratings cut the Outlook for the rating of sovereign debt of the local currency of China to "negative" from "stable" this weekciting a likely deterioration of quality of the assets of the Bank. Moody's Investors Service lowered its Outlook for the property sector to "negative" from "stable" on the residential concern sales could reduce by 30% if local governments apply borders of housing.In contrast, Industrial & Commercial Bank of China Ltd., lending more of the world by the value of market, said its bad-loan ratio decreased and excluded a deterioration in the quality of property assets and the local Government of loan. "If economic growth, the financial sector is required to do well,"President Jiang Jianqing told in an interview with Bloomberg Television to Sanya in southern China's Hainan province yesterday." "The challenges that we face in areas such as real estate and local government funding vehicles will all solved." Chinese banks asset quality deteriorates. "China should protect against the risk of overheating, International Monetary Fund said in its semi-annual Economic Outlook published on 11 April. "Credit growth remains high compared to dazzling previous crises and credit booms and concern mounting on the potential for steep corrections in the price of real estate and their implications, the Fund has.

-Victoria Ruan, Zheng Lifei, Zhang Dingmin. With the help of Jay Wang at Singapore. Editors: Paul Panckhurst, Sunil Jagtiani.

To communicate with the staff of Bloomberg News on this story: Victoria Ruan vruan1@bloomberg.net Beijing; Zheng Lifei in Beijing at lzheng32@bloomberg.net

% CNY

To contact the editor responsible for this story: Paul Panckhurst in the ppanckhurst@bloomberg.net

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