On Thursday, Aug. 3, Nortel Networks
- Nortel is GAAP profitable again, but at the same time, free cash flow has turned negative.
- The operating and net margin improvements are not as solid as they look. $455 million, or $0.10 per diluted share, of the operating earnings came from litigation recoveries and other one-time items.
- Back out those items, and Nortel saw operating margins of -1.32%, along with net margins of -3.1%. Looks can be deceiving.
(Figures in millions, except per-share data)
Income Statement Highlights
|Avg. Est.||Q2 2006||Q2 2005||Change|
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|Q2 2006||Q2 2005||Change*|
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Balance Sheet Highlights
|Assets||Q2 2006||Q2 2005||Change|
|Cash + ST Invest.||$2,550||$3,133||(18.6%)|
|Liabilities||Q2 2006||Q2 2005||Change|
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Cash Flow Highlights
|Q2 2006||Q2 2005||Change|
|Cash From Ops.||($108)||$110||N/A|
|Free Cash Flow||($186)||$40||N/A|
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