Nortel Posts Q3 Loss, Forecasts Weaker 2004

NEW YORK (AP) -- Nortel Networks Corp. reported a loss of 6 cents per share in the third quarter and predicted lower sales for 2004 than in 2003 on Tuesday, providing some of its first concrete figures for the year after accounting issues led the company to delay financial reports.

The Canadian telecommunications equipment maker said the earnings figure includes charges from a wireless contract in India, a charge from restructuring and a gain from asset transfers. Excluding these items, Nortel would have broken even per share, matching estimates from analysts surveyed by Thomson First Call.

The company estimated third-quarter sales at $2.3 billion, below the analyst estimate of $2.47 billion.

``While customer support remains strong, the ongoing restatement activities and the internal restructuring and realignment programs initiated in August have impacted business performance in the third quarter but this impact is temporary,'' president and chief executive Bill Owens said in a statement. Owens pointed to the Indian wireless contract, Nortel's first in that country, as a sign of growth. Wireless networks accounted for 46 percent of sales in the third quarter.

The company said it expects fourth quarter revenue of $2.8 billion to $2.9 billion and 2004 revenue of $10.1 billion to $10.2 billion. Nortel said these results will come in below 2003 sales, after a restatement adds about $460 million to the year-end total.Analysts expect fourth-quarter sales of $2.69 billion and year-end revenue of $10.3 billion.

Nortel has said it will file long-delayed financial reports for the first two quarters of 2004 on Jan. 10. The company estimated Tuesday that it broke even in the first and second quarter on sales of $2.46 billion and $2.59 billion, respectively. The results were in line with analysts' estimates.

The company's shares were up 1 cent in the extended session after closing down 9 cents, or 2.4 percent, at $3.69 on the New York Stock Exchange.