20-F/A

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F/A

 

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

 

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Fiscal Year Ended December 31, 2017

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

 

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 000-12033

TELEFONAKTIEBOLAGET LM ERICSSON

(Exact Name of Registrant as Specified in its Charter)

LM ERICSSON TELEPHONE COMPANY

(Translation of Registrant’s name into English)

Kingdom of Sweden

(Jurisdiction of incorporation or organization)

SE-164 83 Stockholm, Sweden

(Address of principal executive offices)

Jonas Stringberg, Vice President, Group Controller

Telephone: +46 10 716 53 20, jonas.stringberg@ericsson.com

SE-164 83 Stockholm, Sweden

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

 

Title of Each Class

 

Name of Each Exchange on which Registered

American Depositary Shares (each representing one B share)   The NASDAQ Stock Market LLC
B Shares *   The NASDAQ Stock Market LLC

 

* Not for trading, but only in connection with the registration of the American Depositary Shares representing such B Shares pursuant to the requirements of the Securities and Exchange Commission.

Securities registered pursuant to Section 12(g) of the Act:

None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act:

None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report:

 

B shares (SEK 5.00 nominal value)

     3,072,395,752  

A shares (SEK 5.00 nominal value)

     261,755,983  

C shares (SEK 5.00 nominal value)

     0  

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  ☒    No  ☐

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.    Yes  ☐    No  ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files)    Yes  ☐    No  ☒

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company . See the definitions of “large accelerated filer” and “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer      Accelerated filer  
Non-accelerated filer      Emerging growth company  

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐

 

The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

 

☐  U.S. GAAP

 

                ☒     

  International Financial Reporting Standards as issued by the International Accounting Standards Board    ☐  Other

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

Item 17  ☐    Item 18  ☐

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

 

 

 

 


Explanatory Note

LM ERICSSON TELEPHONE COMPANY is filing this Amendment No. 1 (the “Form 20-F/A”) to its annual report on Form 20-F (the “Form 20-F”) for the fiscal year ended December 31, 2017, to:

 

   

Submit the Interactive Data File (as defined in Rule 11 of Regulation S-T) with respect to the audited consolidated financial statements of LM ERICSSON TELEPHONE COMPANY (as defined in the Form 20-F) for that fiscal year as an exhibit to the Form 20-F pursuant to paragraph 101 under “Instructions as to Exhibits” of Form 20-F in accordance with Rule 405 of Regulation S-T.

 

   

Correct typographical errors in Item 3.A “Key Information—Selected Financial Data.”

Other than as expressly set forth above, this Form 20-F/A does not, and does not purport to, amend, update or restate the information in any Item of the Form 20-F or reflect any events that have occurred after the Form 20-F was originally filed. The Form 20-F, as amended by this Form 20-F/A, continues to speak as of the initial filing date of the Form 20-F.

 


ITEM 3. KEY INFORMATION

 

A. Selected Financial Data

We present below certain selected financial data derived from our consolidated financial statements as of and for the years ended December 31, 2017, 2016, 2015, 2014, and 2013 , included herein, prepared in accordance with the International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). IFRS differs in certain significant respects from the accounting principles generally accepted in the United States, or “U.S. GAAP.”

The summary financial data should be read in conjunction with our consolidated financial statements and the notes thereto contained in this 2017 Form 20-F, as well as the information set forth under the heading “Item 5. Operating and Financial Review and Prospects” and the information set forth under the following headings of the 2017 Swedish Annual Report, which are incorporated herein by reference:

 

    Other Information

 

    Alternative Performance Measures

 

    Financial Terminology and Exchange rates

 

     2017     Change     2016     2015     2014     2013  

Net sales

     201,303       –10     222,608       246,920       227,983       227,376  

Operating expenses

     –70,563       17     –60,501       –64,129       –63,408       –58,509  

Operating income (loss)

     –38,126       —         6,299       21,805       16,807       17,845  

Net income (loss)

     –35,063       —         1,895       13,673       11,143       12,174  

Restructuring charges

     8,501       12     7,567       5,040       1,456       4,453  

Cash flow from operating activities

     9,601       –31     14,010       20,597       18,702       17,389  

Year-end position, SEK million

            

Total assets

     260,544       –8     283,347       284,363       293,558       269,190  

Property, plant and equipment

     12,857       –23     16,734       15,901       13,341       11,433  

Stockholders’ equity

     99,540       –29     139,817       146,525       144,306       140,204  

Non-controlling interest

     636       –6     675       841       1,003       1,419  

Per share indicators

     636            

Earnings (loss) per share, basic, SEK

     –10.74       —         0.53       4.17       3.57       3.72  

Earnings (loss) per share, diluted, SEK

     –10.74       —         0.52       4.13       3.54       3.69  

Dividends per share, SEK

     1.00 1)      0     1.00       3.70       3.40       3.00  

Dividends per share, USD

     0.13 2)      13     0.11       0.39       0.41       0.46  

Number of shares outstanding (in millions) end of period, basic

     3,284       0     3,269       3,256       3,242       3,231  

average, basic

     3,277       0     3,263       3,249       3,237       3,226  

average, diluted

     3,317       0     3,303       3,282       3,270       3,257  

Other information, SEK million

            

Additions to property, plant and equipment

     3,877       –37     6,129       8,338       5,322       4,503  

Depreciations and writedowns/impairments of property, plant and equipment

     6,314       38     4,569       4,689       4,316       4,209  

Acquisitions/capitalization of intangible assets

     1,759       —         5,260       5,228       6,184       4,759  

Amortization and write-downs/impairments of intangible assets

     21,578       —         4,550       5,538       5,629       5,928  

Research and development expenses

     37,887       20     31,635       34,844       36,308       32,236  

as percentage of net sales

     18.8     —         14.2     14.1     15.9     14.2

Inventory turnover days

     64       –7     69       64       64       62  

 

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Alternative Performance Measures (APMs)

            
Gross margin      22.1     —         29.8     34.8     36.2     33.6

Operating margin

     –18.9     —         2.8     8.8     7.4     7.8

EBITA margin

     –10.7     —         4.0     10.5     9.3     9.8

Cash conversion

     –58     —         175     85     84     79

Free cash flow

     5,109       —         254       7,515       4,593       8,337  

Capital employed, SEK million

     158,230       –17     190,901       195,150       189,839       180,903  

Return on equity

     –29.4     —         1.2     9.3     8.1     8.7

Return on capital employed

     –22.0     —         3.2     11.6     9.8     10.7

Equity ratio

     38.4     —         49.6     51.8     49.5     52.6

Capital turnover

     1.2       0     1.2       1.3       1.2       1.3  

Working capital, SEK million

     59,779       –33     89,039       104,811       103,246       106,940  

Gross cash, SEK million

     67,702       17     57,877       66,270       72,159       77,089  

Net cash, SEK million

     34,657       11     31,191       41,150       48,014       47,634  
Statistical data, year-end             

Number of employees

     100,735       –10     111,464       116,281       118,055       114,340  

of which in Sweden

     13,864       –9     15,303       17,041       17,580       17,858  

Export sales from Sweden, SEK million

     86,812       –19     107,036       117,486       113,734       108,944  

 

1) For 2017, as proposed by the Board of Directors.
2) For 2017, as proposed by the Board of Directors. Approximate USD Dividend Rate.

Exchange Rates

The following tables provide information with respect to the exchange rate for SEK per USD 1.00 based on the noon buying rate for cable transfers in SEK as certified for customs purposes by the Federal Reserve Bank of New York. The noon buying rate of 16 March 2018 was SEK 8.1960 per USD 1.00. The average exchange rate is computed using the noon buying rate on the last business day of each month during the period indicated.

 

Year ended December 31,

   Average  

2013

     6.5152  

2014

     6.9222  

2015

     8.4643  

2016

     8.5959  

2017

     8.4798  

 

Month

   High      Low  

October 2017

     8.3803        8.0534  

November 2017

     8.4803        8.2769  

December 2017

     8.5053        8.1732  

January 2018

     8.2413        7.8549  

February 2018

     8.2694        7.8588  

Effects of exchange rate fluctuations on our business is described in the Notes to the Consolidated Financial Statements—Note C20, “Financial Risk Management and Financial Instruments.”

Noon buying rates are not used in the preparation of our financial statements. The exchange rates used in the preparation of our consolidated financial statements are presented below:

 

     2017      2016  

SEK/EUR

     

Average rate1)

     9.64        9.44  

Closing rate

     9.83        9.56  

SEK/USD

     

Average rate

     8.53        8.56  

Closing rate

     8.20        9.06  

 

1) Average rate is included for disclosure purposes only. Period income and expenses for each income statement are translated at period average exchange rates.

 

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PART III

 

ITEM 19 EXHIBITS

 

Exhibit

Number

  

Description

101.INS*    XBRL Instance Document.
101.SCH*    XBRL Taxonomy Extension Schema Document.
101.CAL*    XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF*    XBRL Taxonomy Definition Linkbase Document.
101.LAB*    XBRL Taxonomy Extension Label Linkbase Document.
101.PRE*    XBRL Taxonomy Extension Presentation Linkbase Document.

 

* In accordance with Rule 406T(b)(2) of Regulation S-T, such XBRL information will be furnished and not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, will be deemed not filed for purposes of Section 18 of the Exchange Act of 1934, as amended, and otherwise will not be subject to liability under those sections.”

 

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SIGNATURE

The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorized the undersigned to sign this Amendment No. 1 to its Annual Report on Form 20-F on its behalf.

 

TELEFONAKTIEBOLAGET LM ERICSSON
By:  

/s/ JONAS STRINGBERG

Name:   Jonas Stringberg
Title:   Vice President, Group Controller
By:  

/s/ XAVIER DEDULLEN

Name:   Xavier Dedullen
Title:   Senior Vice President, Chief Legal Officer

Date: April 20, 2018

 

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