French communications equipment firm Alcatel, which employs 80 people in Ireland, today squeezed out a second-quarter operating profit as cost savings kept it on track to break even for the full year despite a weak but stabilising market.
Shares in Europe's largest telecoms equipment maker rose nearly seven percent to €8.35, having nearly doubled since January, as investors welcomed Alcatel's better-than-expected earnings, stronger cash position and lower debt. The DJ Stoxx Eurotech index was up 1.9 per cent on the day, and is up 18 per cent this year.
"For the third quarter we expect Alcatel's revenues to be about stable, with a continued improvement in our operating results in line with the declining trend of our costs," chief executive Mr Serge Tchuruk said in a statement, adding he was comfortable with previously stated targets for the year.
Alcatel, which like rivals Lucent, Nortel and Ericsson is struggling with weak demand from cautious operators, has said it would reach operating break even for the full year. Income before goodwill amortisation and one-time charges should get to break even before year end.
"We still anticipate the market in the second half of this year to be close to the second half of 2002," Mr Tchuruk said. Analysts said Alcatel had done better than expected.