Alcatel-Lucent today said it has scrapped its dividend payment after recording a loss in its first year as a merged entity.
Alcatel, which acquired Lucent in 2006, said it had taken a €2.94 billion impairment charge on the value of Lucent's assets and called 2007 a difficult year.
The French-American telecoms equipment provider made an annual loss of €443 million ($647.8 million).
It said it expected to incur an adjusted operating loss in the first quarter of 2008 due to "seasonal patterns". "The macroeconomic environment has created uncertainty in our markets in the last few months," Alcatel-Lucent chief executive Patricia Russo said.
In light of the outlook and results, the group said it was prudent to scrap the dividend payment for 2007.
Alcatel-Lucent said it expected an adjusted operating margin of between 2.5 per cent and 5 per cent for 2008.
Finance director Hubert de Pesquidoux said the bulk of the impairment charge for 2007 was related to 3G assets it bought from Lucent and losses in the year were mostly incurred by the group's mobile activities.
Alcatel-Lucent generated sales of €17.8 billion in the 12 months to December 31st, slightly above a forecast of €17.5 billion from analysts polled by Reuters Estimates.