nokia mission statement by samanthac

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About Nokia

About Nokia

Chairman’s statement

The year 2004 can be characterized as a year of change. While some markets moved closer to maturity, other high-growth markets took off; customer dynamics shifted as new players arrived and others moved towards consolidation; competition intensified and began changing face; even the underlying technologies of our business remain in flux, as we move from traditional cellular networks to 3G, IP, and alternative access technologies.

Jorma Ollila, Nokia Chairman and CEO

About Nokia

Chairman’s statement

The world around us The number of mobile users around the world is rising dramatically, especially in fast growing markets like India, Russia, China and in Latin America and Africa. Success in high-growth markets is not only good news for Nokia’s business, but for people in developing countries who are just discovering the benefits of mobile communications in their lives and even their livelihoods. Nokia is playing a role in boosting growth by working on a number of fronts with operator customers, local authorities and through the UNICT Taskforce to increase the availability, affordability, and even usability, of mobile communications in these countries. At the same time, in more developed markets, a blurring of industry boundaries is bringing completely new mobile devices, services and ways of using mobile devices both socially and professionally. This is already clear from the phenomenal success of camera phones as well as the growing use of smartphones, not just for making calls, but also for computer-like applications such as email, web browsing and music downloading. With this increasing demand for newgeneration devices and services and more and more users in growth markets gaining access to mobile communications, we now expect the global number of mobile subscriptions to reach three billion by 2010.

Our mission of connecting people is more than just an advertising buzz phrase. It describes what we do. It says what benefits we bring to our operator and enterprise customers, to consumers and to society. It says who we are and what we represent. It is our compass; we use it to drive our business forward and to deliver value to our customers.

About Nokia

Chairman’s statement

Nokia in 2004 The year 2004 can be characterized as a year of change. While some markets moved closer to maturity, other highgrowth markets took off; customer dynamics shifted as new players arrived and others moved towards consolidation; competition intensified and began changing face; even the underlying technologies of our business remain in flux, as we move from traditional cellular networks to 3G, IP, and alternative access technologies. This kind of grand-scale change brings problems – or what we in business like to refer to as new challenges. However, just as in the first days of GSM, change also brings enormous opportunities. For Nokia, fast-changing industry dynamics in a big global market are as important to value creation as market growth, but only with the right focus. We began the year by reorganizing our internal structure into four business groups that better reflect the new and growing market segments in our external environment. At the close of the year we also took decisive steps to confront the challenges of a dynamic industry with the announcement of five companywide priorities in the areas of customer approach, product portfolio and technologies.

On an operational level, we entered entirely new markets in Africa, and stepped up our commitment to fast-growing markets where we already have a strong presence, such as China, India, Russia, and some Latin American and African countries. Our new organizational structure also brought greater awareness of the way we operate internally, as we began learning to work together effectively within an entirely new framework. In the area of corporate governance, we comply with a number of rules and regulations as required by our various stock exchange listings. One example is the Sarbanes-Oxley Act, legislation relating to corporate governance, financial disclosure and public accounting. I see the increased attention to internal controls through Sarbanes-Oxley as beneficial for Nokia in that it requires us to review and document our existing good practices, confirming roles, responsibilities and internal accountability. This kind of awareness also shines more light on our Code of Conduct and Nokia Values.

About Nokia

Chairman’s statement

Investing in the community through social or environmental programs is another way for us to express our values and our corporate character. Our goal is to be a good contributing member of society wherever we operate. We have a lot of local activities ongoing including employee volunteering, disaster relief and corporate giving. Nokia also has a company-wide focus on youth life-skills and education, taking part in long-term projects aimed at helping young people create their place in the world. Despite difficult and changing industry dynamics, if we look at our 2004 performance, Nokia emerged the clear number one in the mobile device industry, in volumes, market share, and overall profitability. In acknowledgement of increased transparency and positive developments in our environmental and ethical programs, Nokia also came first for the second year running in the Dow Jones Sustainability Index European Technology and Global Communications Technology categories.

About Nokia

Our people

As a team, we can rise to any challenge with a clear competitive focus and a strong will to do so. The talent and efforts of our people have been fundamental to our success in becoming a world leader in mobile communications. We are working to make sure our people remain energized and motivated to build on this success.

About Nokia

Our people

The heart of Nokia As a team, we can rise to any challenge with a clear competitive focus and a strong will to do so. The talent and efforts of our people have been fundamental to our success in becoming a world leader in mobile communications. We are working to make sure our people remain energized and motivated to build on this success. At the end of 2004, Nokia employed 55 505 people from 119 countries. This literally creates for our people a world of opportunity. New employees at Nokia are often struck by the international orientation of our company. And, for many, working side by side with individuals from diverse backgrounds is an attractive prospect. The scale of Nokia’s business also means our employees have the chance to lead or participate in projects that have global impact, changing the lives of millions of people and living our mission: connecting people.

Nokia LiveLife program As people have different priorities, Nokia offers a wide range of opportunities and the flexibility to make sure that they are accessible. The recognition of achievement through a mix of individual, team and company-wide incentives is one aspect. However, equally important is the support given to personnel in finding a balance between work and free time, as well as the creation of opportunities for personal and professional growth. ‘Nokia LiveLife’ is an employee program helping our people gain greater work-life balance. The program, which now covers a major portion of our global operations, comes up with locally tailored products and services, as well as extra benefits focused on employee well-being, motivation and work satisfaction. Offerings might include Nokia-sponsored hobby groups and sports teams, discounted travel and accommodation, social events such as Family Day, health and fitness assessments, and even seminars on work-life balance or financial planning.

About Nokia

Our people

As people have different priorities, Nokia offers a wide range of opportunities and the flexibility to make sure that they are accessible. The recognition of achievement through a mix of individual, team and company-wide incentives is one aspect. However, equally important is the support given to personnel in finding a balance between work and free time, as well as the creation of opportunities for personal and professional growth.

Health and safety Our global Occupational Health and Safety team is working systematically around the world to increase employee access to a wide range of opportunities in health and fitness, fulfillment through work-life balance, and professional and personal growth. Focus areas are directed by a Global Management Team and led regionally by designated management team members and specialists. The fundamental principles of our occupational health and safety initiative are based on the International Labor Organization’s standards and codes of practices. In 2004, we introduced a new global policy on occupational health and safety covering all Nokia employees. Additionally, in-depth internal health and safety assessments of all of our production sites were carried out. Following the assessments, detailed action plans were created and these are being implemented locally. Living the Nokia Values Ultimately, the most important thing in the workplace is that people can feel motivated, valued and comfortable. Through the Nokia Values: customer satisfaction, achievement, respect and renewal, we aim to create such an atmosphere, where people can be themselves and excel at what they do. Our values also help us establish a firm base from which we can research, create and deliver the quality products and services our customers want, while building a corporate image, with which our stakeholders are proud to be connected.

About Nokia

Our people

Ultimately, the most important thing in the workplace is that people can feel motivated, valued and comfortable. Through the Nokia Values: customer satisfaction, achievement, respect and renewal, we aim to create such an atmosphere, where people can be themselves and excel at what they do. Our values also help us establish a firm base from which we can research, create and deliver the quality products and services our customers want, while building a corporate image, with which our stakeholders are proud to be connected.

About Nokia

Our business

Nokia is and will continue to be a market and customer driven product company. For us, business success means competing profitably in all our market segments, chosen technologies and geographical regions. Our volume advantage and cost leadership help make this possible. As part of our overall strategy, we will continue working to strengthen our market-leading position in new market segments, as well as lead the development and commercialization of high capacity networks, in line with rising demand for next generation products and services.

About Nokia

Our business

Our business Today, Nokia is a world leader in mobile communications, contributing to the growth and sustainability of the broader mobility industry. Nokia is dedicated to enhancing people’s lives and productivity by providing easy-to-use products like mobile phones and solutions for imaging, games, media, mobile network operators and businesses. Today, Nokia comprises four business groups: Mobile Phones, Multimedia, Enterprise Solutions, and Networks. Strategy and outlook Nokia is and will continue to be a market and customer driven product company. For us, business success means competing profitably in all our market segments, chosen technologies and geographical regions. Our volume advantage and cost leadership help make this possible. As part of our overall strategy, we will continue working to strengthen our market-leading position in new market segments, as well as lead the development and commercialization of high capacity networks, in line with rising demand for next generation products and services. Historically, expanding into new segments during their early development stage meant being able to influence how voice and other services have become mobile. We will continue this approach with our strategy to expand mobile voice, drive consumer multimedia, and bring mobility to enterprises.

Looking back The company has come a long way from its nineteenth century origins in the paper industry. In the early 1990’s when mobile telecommunications as we know it barely existed, Nokia played a key role not just in shaping the industry but in actually inventing it! An unprecedented growth opportunity came from the emergence of GSM – a digital standard that could replace analogue in many countries around the world. Nokia’s energy, resource and focus were shifted solely into mobile telecommunications. It was a ‘go for growth’ strategy. In 1993, Nokia developed a product series with identical phones that worked on the GSM network and the US and Japanese standards. At the time when it started shipping, the company’s projection to sell 400,000 was considered laughably ambitious. Nokia in fact sold 20 million and the company was on its way. In those days the industry looked very different. It was a simpler world. Nokia and other manufacturers fought to expand phone volume production to critical mass, while operators focused on bringing mobile voice to their customers and increasing subscriber numbers. Mobile infrastructure suppliers, including Nokia, put their expertise into building coverage for mobile voice, and doing so as quickly as possible. In just one decade, mobile phone subscriptions went from almost zero to one billion.

About Nokia

Our business

Today, Nokia is a world leader in mobile communications, contributing to the growth and sustainability of the broader mobility industry. Nokia is dedicated to enhancing people’s lives and productivity by providing easy-to-use products like mobile phones and solutions for imaging, games, media, mobile network operators and businesses. Today, Nokia comprises four business groups: Mobile Phones, Multimedia, Enterprise Solutions, and Networks.

New growth phase Now, as the features and functionality of mobile devices extend from voice to imaging, games, entertainment and business applications, and more and more users in growth markets gain access to mobile communications, we are again entering a new period of transformation. Mobile voice still represents a significant growth segment, but today it’s just one of many. The number of new mobile users in fast growing markets where penetration levels are low (India, Russia, China, most Latin American countries and several African countries) is rising dramatically and Nokia is stepping up its commitment to new high-growth markets. For example, our networks and mobile phones business groups are working on solutions to bring down the total cost of ownership in these countries, driving growth, delivering value to our operator customers and boosting the availability and affordability for new users. At the other end of the spectrum, in the replacement and upgrade markets, and in some developing markets, we are also capitalizing on new growth opportunities. Our multimedia business group, for instance, offers devices that take pictures, play games and music, and show digital TV, while our Enterprise business group is focused on bringing mobility to businesses and marrying it with the best of the IT world. Against this global growth backdrop, we now expect the total global mobile subscriber base to reach two billion by the end of 2005 and rise to three billion subscriptions by 2010.

About Nokia

Our business

Now, as the features and functionality of mobile devices extend from voice to imaging, games, entertainment and business applications, and more and more users in growth markets gain access to mobile communications, we are again entering a new period of transformation. Mobile voice still represents a significant growth segment, but today it’s just one of many.

About Nokia

Our actions

Mobile communications is already an established force for positive change, driving economic development and improving social wellbeing. It gives people a voice, helps them build personal and professional networks, and provides a base for more widespread information sharing. We aim to increase the penetration of mobile phones in countries where basic communications infrastructure is sparse or non-existent. Nokia is working closely with operator customers and governments to offer affordable mobile entry products and solutions to a broader cross-section of society, in a way that is financially viable.

About Nokia

Our actions

Impact of our business With approximately one in every third mobile phone in use made by Nokia, our operations influence the lives of hundreds of millions of people; as customers, employees, business partners and investors. As market leader with global operations, Nokia takes its responsibility seriously and has many established practices and programs to help make sure that our overall impact is positive. Profitable business fundamental to citizenship In 2004, Nokia emerged the clear number one in the mobile device industry, in volumes, market share and profitability. Running a well-managed, successful business is in itself an important driver for economic growth. Strong profitability over time gives us the means to develop the products and services people want, provide stable employment and create new jobs, as well as reward our shareholders. A sound financial base also provides for investment into future technologies as well as new growth markets, which is not only good for our business, but for the lives and livelihoods of people in developing countries.

Mobile communications good for society Mobile communications is already an established force for positive change, driving economic development and improving social wellbeing. It gives people a voice, helps them build personal and professional networks, and provides a base for more widespread information sharing. We aim to increase the penetration of mobile phones in countries where basic communications infrastructure is sparse or non-existent. Nokia is working closely with operator customers and governments to offer affordable mobile entry products and solutions to a broader cross-section of society, in a way that is financially viable.

About Nokia

Our actions

With approximately one in every third mobile phone in use made by Nokia, our operations influence the lives of hundreds of millions of people; as customers, employees, business partners and investors. As market leader with global operations, Nokia takes its responsibility seriously and has many established practices and programs to help make sure our overall impact is positive.

Nokia commitment to society Going beyond our core business activities, investing in the community through social or environmental programs is another important way for us to express our corporate character and values as well as our overall sense of responsibility. Nokia has a range of local activities ongoing, including employee volunteering, disaster relief and corporate giving, and a company-wide focus on youth life-skills and education. Our long-term projects are aimed at helping young people create their own place in the world. During 2004, we expanded our youth life-skills program, Make a Connection, from 16 to 19 countries. We also gained excellent results from our Philippines pilot of Bridgeit. Launched by Nokia, the International Youth Foundation, the United Nations Development Programme and Pearson, Bridgeit uses mobile technology to bring interactive, multimedia-learning materials to schools. With this successful pilot, we are now committed to expanding the program to double the number of schools and replicating it in other countries. Through Nokia Helping Hands, our employee volunteering initiative, thousands of our employees contribute their time and effort to worthy causes. In 2004, our people contributed over 16,000 hours to their local communities in 23 countries. Nokia's approach to environmental issues is based on lifecycle thinking. Environmental considerations are integrated into our activities through four programs that cover the entire product lifecycle. Design for Environment aims to ensure that new products do not contain restricted materials, are energy and material efficient and recyclable. Supplier Network Management oversees the environmental impact of suppliers. Environmental Management

About Nokia

Our actions

Systems control the environmental impact of Nokia's own operations, while End-of-Life Practices focus on take-back systems as well as the safe recycling of products, ensuring the recovery of materials and energy. Integrating ethical thinking into everyday business Our Code of Conduct, outlines how every one of us must carry out our work and comply with ethical and legal standards. However, a code in itself becomes meaningless without awareness and training. During 2004, we staged a company-wide awareness building push on our Code of Conduct. As part of the campaign, teams were encouraged to sit down with top management and openly debate concrete examples and potential ethical dilemmas within their own work context from a responsible business standpoint. Our challenge is to integrate and uphold responsible practices in every single thing we do, on an individual level, in all countries where we operate and together with our external partners. That means working together with all parties in our value chain, upstream and down, ensuring that we are legally compliant and that global issues of environment, health, diversity and human rights become a natural part of the way we work.

About Nokia

Additional information

2004 EURm

2003 Change, Net sales by % business group EURm –1 –14 –12 –11 Mobile Phones Multimedia Enterprise Solutions Networks Nokia Group

2004

2003

Net sales 29 267 29 455 Operating profit 4 330 5 011 Profit before taxes 4 709 5 345 Net profit 3 207 3 592

18 507 3 659 830 6 367 29 267

20 951 2 504 529 5 620 29 455

This was a year of record-breaking mobile device volumes for our industry, which drove both the device and infrastructure markets forward. Global mobile subscriptions also rose sharply to 1.7 billion in 2004. In Nokia’s Mobile Phones, Multimedia and Enterprise Solutions business groups, combined mobile device volume also reached new record highs, rising 16% compared with 2003. This was largely backed by the ongoing boom in growth markets such as Latin America, Russia, India and China, and brisk sales of color screen and camera phones. Nokia’s estimated market share for 2004 was 32%, based on an estimated industry volume of 643 million units, compared with 38% in 2003. In our infrastructure business, 2004 was a pivotal year. We significantly expanded our presence in India and Russia, and entered new markets in the Middle East and Africa. In the second half, the pace of commercial 3G launches intensified in more developed markets, with the number of subscribers jumping to nearly 16 million by the end of 2004. By the end of the year, we were a supplier to 28 of the 63 commercially launched 3G networks.

Networks business group 2004 net sales increased 13% to EUR 6.4 billion compared with 2003 due to increased sales in nearly all markets as operators increased their investments in network infrastructure. At constant currency, Networks business group net sales would have been up 21%. Looking at Nokia’s business performance overall for the year 2004, Nokia emerged as the clear industry leader in mobile devices, with leading volumes, market share, and overall profitability. For a detailed view of our financial performance in 2004, please refer to our downloadable Form 20-F and our end of year results press release. In acknowledgement of increased transparency and positive developments in our environmental and ethical programs, Nokia also came in first place for the second year running in the Dow Jones Sustainability Index European Technology and Global Communications Technology categories.

About Nokia

Additional information

Research & development 2004

2003 10 largest markets, net sales EURm 2004 USA China UK Germany India Brazil Russia United Arab Emirates Italy 2003 Spain 3 416 2 660 2 261 1 730 1 364 1 091 938 909 884 768

2003 4 475 2 013 2 693 2 297 1 062 805 570 1 886 1 003 748

Number of R&D employees 20 722 19 849 Number of countries where R&D centers located 12 11 R&D expenditure, EURm 3 733* 3 760*
*includes impairments, write-offs and personnel-related restructuring costs in Networks

Personnel by Business Group, Dec. 31 Mobile Phones Multimedia Enterprise Solutions Networks Common Group Functions Nokia Group

2004

2 558 2 764 2 738 2 777 2 234 1 986 16 595 15 301 31 380 28 531 55 505 51 359

Net sales 2000-2004
35 000 30 000 25 000 20 000 15 000 10 000 5 000 EURm 00 01 02 03 04

Operating profit 2000-2004

6 000 5 000 4 000 3 000 2 000 1 000 EURm 00 01 02 03 04

About Nokia

Additional information

Information on the Internet www.nokia.com/investor Available on the Internet: financial reports, Nokia management’s presentations, conference call and other investor related material, press releases as well as environmental and social information. Investor relations contacts investor.relations@nokia.com Nokia Investor Relations 709 Westchester Ave. White Plains, NY 10604 USA Tel +1 914 368 0555 Fax +1 914 368 0600 Nokia Investor Relations P.O. Box 226 FIN-00045 NOKIA GROUP Finland Tel + 358 7180 34927 Fax +358 7180 38787

Annual General Meeting Date: Thursday April 7, 2005 at 3.00 pm Address: Hartwall Areena, Veturitie 13, Helsinki, Finland Dividend Dividend proposed by the Board of Directors for 2004 is EUR 0.33. The dividend record date is proposed to be April 12, 2005 and pay date April 22, 2005. Financial reporting Nokia’s quarterly reports in 2005 are planned for April 21, July 21, and October 20. The 2005 results will be published in January 2006 and the financial statements in March 2006.

Personnel by market area Dec. 31, 2004

Net sales by market area 2004

15%

20%

42%

20%

55%

23%

25%

Finland 42% Other European countries 23% Americas 20% Asia-Pacific and China 15%

Europe/Africa/Middle East 55% Asia-Pacific and China 25% Americas 20%

About Nokia

Additional information

Stock exchanges The shares of Nokia Corporation are quoted on the following stock exchanges: Symbol HEX, Helsinki (quoted since 1915) Stockholmsbörsen (1983) Frankfurter Wertpapierbörse (1988) New York Stock Exchange (1994) NOK1V NOKI NOA3 NOK Trading currency EUR SEK EUR USD

List of indices NOK1V HEX HEX General Index HEXTELE HEX Telecommunications HEX 25 HEX 25 Index BE500 Bloomberg Europe BETECH BBG Europe Technology SX5E DJ Euro STOCXX 50 SX5P DJ Europe STOXX SX__ Various other DJ Indices E300 FTSE Eurotop 300

NOKI OMX Stockholm GENX Swedish General GENX04 Swedish Engineer GENX16 Swedish SX 16 Index

NOK NYA NYSE Composite NNA NYSE Utilities NN NYSE Utilities CTN CSFB Technology MLO Merrill Lynch Tech 10

(Nominal) dividend per share

Earnings per share (basic)

0.30 0.25 0.20 0.15 0.10 0.05 EUR 00 01 02 03 04* * Board’s proposal 0.8 0.6 0.4 0.2 EUR 00 01 02 03 04

Contact information Nokia Head Office Keilalahdentie 2-4 FIN-02150 Espoo P.O. Box 226 FIN-00045 Nokia Group Finland Tel. +358 (0) 7180 08000 Fax +358 (0) 7180 38226 Nokia Americas 6000 Connection Drive Irving, Texas 75039 USA Tel. +1 972 894 5000 Fax +1 972 894 5106 Nokia Asia-Pacific 438B Alexandra Road #07-00 Alexandra Technopark Singapore 119968 Tel. +65 6723 2323 Fax +65 6723 2324


								
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