The French telecom equipment maker lost $507 million in its first quarter as sales fell 31%, but still hopes to break even by year's end
PARIS (AP) -- French telecommunications equipment maker Alcatel reported a first-quarter loss of 461 million euros ($507 million) on a sharp drop in sales Tuesday, but said it still hoped to break even by the end of the year.
The company's sales dropped 31 percent to 2.96 billion euros ($3.25 billion), steeper than its forecast of between 25 percent and 30 percent.
Chairman Serge Tchuruk warned that sales could still slide "a few percentage points" more than the 15 percent the company predicted for 2003 as a whole.
In the face of the telecom industry's deep slump, Alcatel embarked on an aggressive restructuring program that cut costs by 30 percent compared to the same period last year. That was seen on the bottom line, as Alcatel's first-quarter net loss of 461 million euros was substantially better than the 836 million euros loss a year earlier.
The operating loss narrowed to 161 million euros ($177 million) from 343 million euros, slightly better than analysts' expectations.
Tchuruk reiterated Alcatel's goal of breaking even before the end of the year in both operating profit and net income. Alcatel shares rose 4.6 percent to 7.55 euros ($8.30) on the Paris stock exchange.
Alcatel said a strong performance in its high-speed Internet access business was offset by a continued decline in the market for advanced optical components for networks.
The company's lack of color-display cell phones contributed to a 38 percent drop in sales at its communications unit to 798 million euros ($887 million).
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