Ericsson: makes massive writedown, revaluates US tax assets

(CercleFinance.com) - Swedish mobile network gear maker Ericsson said on Tuesday it expects to book a write-down of 14.
2 billion Swedish kronor (about 1.4 billion euros) in its fourth-quarter results, with the majority of goodwill related to investments that were made 10 years ago.

The Stockholm-based firm - which has now completed the impairment testing that was announced in December 2017 - said the write-down has "limited relevance" for its business going forward.

The charge will have no impact on cash flow, the group said.

After the US tax reform reduced the US corporate income tax rate from 35% to 21%, Ericsson also intends to book a non-cash charge of approximately 1 billion Swedish kronor (approximately 100 million euros) that will impact net income in fourth-quarter 2017.

Ericsson's fourth-quarter report is due out on 31 January.

After the statement, Ericsson B shares were down 0.5% at 56.1 Swedish kronor on the OMX/Nasdaq market.

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