Nortel Q1 loss grows

Falling revenues in all its business segments contributed to a $507-million US loss at Nortel Networks in the first quarter.

The company said Monday that it lost $1.02 US per common share in the quarter, compared to a loss of $138 million US, or 28 cents per common share, in the same quarter of last year.

The loss for the most recent quarter includes a charge of $91 million related to the cancellation of some stock compensation plans, $59 million for charges for workforce downsizing and $52 million related to the company's creditor protection proceedings.

The company posted first-quarter revenues of $1.73 billion US, which were down 37 per cent year-over-year. Nortel said currency fluctuations reduced its revenues by about $225 million. Excluding the negative impact of those fluctuations, the company's revenues would have been down by 29 per cent from the previous year.

"First quarter results showed a decline in revenue and margins as expected due to the severe economic downturn and our filings for creditor protection," said company CEO Mike Zafirovski. "However, despite the declines we saw this quarter, revenue has stabilized and our cash balance is stable from year-end 2008."

Nortel's cash balance at the end of March was approximately $2.48 billion US, compared to $2.4 billion at the end of December 2008.

The telecom company has been operating under creditor protection since January.