Revenues at Nokia Ireland plunge 55%

The Irish arm of Nokia went into the red in 2011 as revenues more than halved in the face of increased competition from Apple and Samsung.

Accounts just filed by Nokia Ireland Ltd with the Companies Registration Office show that the firm’s revenues plummeted by over €109m or 55% from €199.8m to €90.1m in the 12 months to the end of Dec 2011.

The dramatic drop in sales in Nokia’s mobile phone handsets here contributed to the Finnish-owned firm recording a €1.65m pre-tax loss in 2011 that followed a pre-tax profit of €6.3m in 2010 — a negative swing of €7.9m.

The directors’ report says “the level of business for the financial year was seriously impacted by the competitive environment and the challenges faced by the Irish economy”.

Is adds: “In 2011, the company’s net sales and profitability were negatively impacted by the increasing momentum of competing smartphone platforms relative to Nokia Symbian smartphones as the group embarked on a platform transition to Windows Phone, as well as our pricing actions due to the competitive environment in both the smartphone and mobile phone markets.”

The “company also made a number of employees redundant during the year to align its operations with the new strategy that was announced during 2010”.

The documents show the firm’s new strategy also brought an overhaul to the board of Nokia Ireland with the firm’s three directors, Roy McCarthy, Alan O’Hara and Edward Morris stepping down. A total of €211,000 was paid to directors for compensation for loss of office in 2011.

Remuneration in 2011 for services as directors totalled €255,000 compared to €277,000 that was paid out in 2010.

In 2010, revenues had fallen 18% from €246.1m to €199.8m while revenues last year compare to €270.8m generated in 2008. The firm recorded an operating loss last year of €1.8m that followed an operating profit of €6.3m in 2010.

Interest receivable last year of €204,000 reduced the firm’s losses to €1.65m.

The company’s cost of sales decreased by 55% from €181.1m to €84m, with administrative expenses rising from €4.9m to €7.2m and distribution expenses reducing from €1.2m to €646,000.

The company had accumulated profits of €10.4m at the end of 2011. No dividend was paid.

The numbers employed last year reduced from 14 to 12 with the firm’s wage bill decreasing from €1.1m to €1m. The firm paid out €509,000 in redundancy payments last year.