Alcatel-Lucent SA Annual Report 2015

521 Pages·2016·8.38 MB·English

2015
Annual Report
on Form 20-F/A
Alcatel-Lucent
SECURITIES AND EXCHANGE COMMISSION
Washington,D.C. 20549
FORM 20-F/A
Amendment No. 1
‘ REGISTRATIONSTATEMENTPURSUANTTOSECTION12(b)OR(g)OFTHESECURITIESEXCHANGEACTOF1934
OR
È ANNUALREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934
ForthefiscalyearendedDecember31,2015
OR
‘ TRANSITIONREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934
OR
‘ SHELLCOMPANYREPORTPURSUANTTOSECTION13OR15(d)OFTHESECURITIESEXCHANGEACTOF1934
Commissionfilenumber:1-11130
(ExactnameofRegistrantasspecifiedinitscharter)
N/A
(TranslationofRegistrant’snameintoEnglish)
RepublicofFrance
(Jurisdictionofincorporationororganization)
148/152routedelaReine
92100Boulogne-Billancourt,France
(Addressofprincipalexecutiveoffices)
MarisaBALDO
TelephoneNumber33(1)55141010
FacsimileNumber33(1)55141405
148/152RoutedelaReine
92100Boulogne-BillancourtFRANCE
(Name,Telephone,E-mailand/orFacsimileNumberandAddressofCompanyContactPerson)
SecuritiesregisteredpursuanttoSection12(b)oftheAct:
Titleofeachclass Nameofeachexchangeonwhichregistered
None
SecuritiesregisteredortoberegisteredpursuanttoSection12(g)oftheAct:
OrdinaryShares,nominalvalue€0.05pershare
SecuritiesforwhichthereisareportingobligationpursuanttoSection15(d)oftheAct:
None
Indicatethenumberofoutstandingsharesofeachoftheissuer’sclassesofcapitalorcommonstockasofthecloseoftheperiodcoveredbythe
annualreport.
3,036,337,359ordinaryshares,nominalvalue€0.05pershare
Indicatebycheckmarkiftheregistrantisawell-knownseasonedissuer,asdefinedinRule405oftheSecuritiesAct.
Yes È No ‘
Ifthisreportisanannualortransitionreport,indicatebycheckmarkiftheregistrantisnotrequiredtofilereportspursuanttoSection13or
15(d)oftheSecuritiesExchangeActof1934.
Yes ‘ No È
Note—checkingtheboxabovewillnotrelieveanyregistrantrequiredtofilereportspursuanttoSection13or15(d)oftheSecurities
ExchangeActof1934fromtheirobligationsunderthosesections.
Indicatebycheckmarkwhethertheregistrant:(1)hasfiledallreportsrequiredtobefiledbySection13or15(d)oftheSecuritiesExchange
Actof1934duringthepreceding12months(orforsuchshorterperiodthattheregistrantwasrequiredtofilesuchreports),and(2)has
beensubjecttosuchfilingrequirementsforthepast90days.
Yes È No ‘
Indicatebycheckmarkwhethertheregistrantisalargeacceleratedfiler,anacceleratedfiler,oranon-acceleratedfiler.Seedefinitionof
“acceleratedfilerandlargeacceleratedfiler”inRule12b-2oftheExchangeAct.(Checkone):
Largeacceleratedfiler È Acceleratedfiler ‘ Non-acceleratedfiler ‘
Indicatebycheckmarkwhichbasisofaccountingtheregistranthasusedtopreparethefinancialstatementsincludedinthisfiling:
U.S.GAAP‘InternationalFinancialReportingStandardsasissuedbytheInternationalAccountingStandardsBoardÈOther‘
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electedtofollow:
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Explanatory Note
This Annual Report on Form 20-F/A is being filed as an amendment (“Amendment No. 1”) to our Annual Report on Form 20-F for
the year ended December 31, 2015 (“2015 Annual Report on Form 20-F”) filed with the U.S. Securities and Exchange Commission
on April 28, 2016, to amend Section 11.6 “Exhibits” to add and to file Exhibits 4.3 and 4.4, which were omitted from our 2015
Annual Report on Form 20-F. As indicated in Section 11.6, certain portions of Exhibits 4.3 and 4.4 have been omitted and filed
separately with the SEC pursuant to a Confidential Treatment Application filed with the SEC. Additionally, Amendment No. 1
amends Section 4.5 “Material contracts” to add references to Exhibits 4.3 and 4.4 and amends Section 11.1 “Controls and
procedures” to correct a misplaced heading.
Other than as set forth above, this Amendment No. 1 does not, and does not purport to, amend, update or restate any other
information or disclosure included in our 2015 Annual Report on Form 20-F or reflect any events that occurred after the April 28,
2016 filing date of our 2015 Annual Report on Form 20-F in any way.
Table of contents
1 7
Selectedfinancialdata 1 Corporategovernance 77
1.1 Condensedconsolidatedincome 7.1 Chairman’scorporategovernance
statementandstatementoffinancial report 78
positiondata 3 7.2 Regulatedagreements 120
1.2 Exchangerateinformation 4 7.3 AlcatelLucentCodeofConduct 121
2 8
Activityoverview 5
Compensationandlong-term
2.1 CoreNetworkingSegment 6 incentives 123
2.2 AccessSegment 7
8.1 Long-termcompensationinstruments
3 usedpriortothesuccessoftheNokia
Offer 124
Riskfactors 9
8.2 StatusoftheExecutiveDirectorsand
officers 137
3.1 Risksrelatingtothebusiness 10
9
3.2 LegalRisks 18
3.3 Risksrelatingtoownershipofour Sustainability 157
ADSsandofourordinaryshares 19
4 9.1 Approachtosustainability 158
9.2 Environment 159
InformationabouttheGroup 21
9.3 HumanResources 162
4.1 General 22 9.4 Supplychain 164
4.2 Historyanddevelopment 22 10
4.3 Structureofthemainconsolidated
Listingandshareholdings 165
companiesasofDecember31,2015 29
4.4 Realestateandequipment 30 10.1 InformationconcerningourCompany 166
4.5 Materialcontracts 31 10.2 Capital 172
5 DescriptionoftheGroup’s 10.3 Shareholding 183
10.4 Stockexchangeinformation 190
activities 35
10.5 Shareholders’Meetings 193
5.1 Businessorganization 36 11
5.2 CoreNetworkingSegment 38
Controlsandprocedures,Statutory
5.3 AccessSegment 42
5.4 Marketing,salesanddistributionofour Auditors’feesandothermatters 195
products 44
11.1 Controlsandprocedures 196
5.5 Competition 44
11.2 Documentsondisplay 200
5.6 Technology,researchand
development 45 11.3 AuditCommitteefinancialexpert 201
5.7 IntellectualProperty 47 11.4 Codeofethics 201
5.8 Sourcesandavailabilityofmaterials 47 11.5 Financialstatements 201
5.9 Seasonality 48 11.6 Exhibits 202
5.10 Ouractivitiesincertaincountries 48 11.7 Cross-referencetablebetween
Form20-Fandthisdocument 203
6
12
Operatingandfinancialreviewand
Alcatel-Lucentconsolidated
prospects 49
financialstatementsat
6.1 Overviewof2015 54
December31,2015 207
6.2 Consolidatedandsegmentresultsof
operationsfortheyearended
December31,2015comparedtothe
yearendedDecember31,2014 55
6.3 Consolidatedandsegmentresultsof
operationsfortheyearended
December31,2014comparedtothe
yearendedDecember31,2013 60
6.4 Liquidityandcapitalresources 65
6.5 Contractualobligationsandoff-
balancesheetcontingent
commitments 69
6.6 Qualitativeandquantitative
disclosuresaboutmarketrisks 73
6.7 LegalMatters 75
6.8 Researchanddevelopment—
expenditures 76
Selected financial data 1
1.1
Condensedconsolidatedincomestatementandstatementoffinancialpositiondata 3
1.2
Exchangerateinformation 4
AlcatelLucent‰AnnualReportonForm20-F2015 1
1
SELECTEDFINANCIALDATA
Our consolidated financial statements have been prepared in On November 30, 2006, historical Alcatel and Lucent
accordance with International Financial Reporting Standards Technologies Inc. (“Lucent”) completed a business combination
(“IFRS”) as adopted by the European Union. IFRS, as adopted pursuanttowhichLucentbecameawhollyownedsubsidiaryof
by the European Union, differs in certain respects from the AlcatelandwasrenamedAlcatel-LucentUSAInc.
International Financial Reporting Standards issued by the
As a result of the purchase accounting treatment of the Lucent
International Accounting Standards Board. However, our
business combination required by IFRS, our results for 2015,
consolidated financialstatements presented in this document in
2014,2013,2012and2011includedseveralnegative,non-cash
accordance with IFRS would be no different if we had applied
impactsofpurchaseaccountingentries.
International Financial Reporting Standards issued by the
International Accounting Standards Board. As permitted by In 2015, we changed our accounting treatment for the
U.S.securitieslaws,wenolongerprovideareconciliationofour recognition of certain deferred tax assets. In accordance with
net income and shareholders’ equity as reflected in our IAS8“Accountingpolicies,changesinaccountingestimatesand
consolidatedfinancialstatementstoU.S.GAAP. errors”, we have retroactively applied this accounting change
andrestatedprioryears(seeNote4toourconsolidatedfinancial
statementsincludedelsewhereinthisannualreport).
2 AnnualReportonForm20-F2015‰AlcatelLucent
SELECTEDFINANCIALDATA
Condensedconsolidatedincomestatementandstatementoffinancialpositiondata
1.1 Condensed consolidated income statement and statement
of financial position data
FortheyearendedDecember31,
(Inmillions,exceptpersharedata) 2015(1) 2015 2014(2) 2013(2)(3) 2012(2)(3) 2011(2)(3)
IncomeStatementData
Revenues U.S.$15,501 €14,275 €13,178 €13,813 €13,764 €14,637
Income(loss)fromoperatingactivitiesbefore
restructuringcosts,litigations,gain/(loss)on
disposalofconsolidatedentities,transaction-
relatedcosts,impairmentofassetsandpost-
retirementbenefitplanamendments 1,090 1,004 572 192 (480) 241
Restructuringcosts (435) (401) (574) (518) (479) (202)
Impairmentofassets (210) (193) - (548) (894) -
Income(loss)fromoperatingactivities 736 678 137 (739) (1,636) 108
Income(loss)fromcontinuingoperations 272 251 (23) (1,336) (2,854) 298
Netincome(loss) 255 235 (72) (1,361) (2,215) 720
Netincome(loss)attributabletoequity
ownersoftheparent 224 206 (107) (1,371) (2,138) 671
Earningsperordinaryshare
Netincome(loss)beforediscontinued
operationsattributabletotheequityowners
oftheparentpershare
Š basic(4) U.S.$0.09 €0.08 €(0.02) €(0.55) €(1.16) €0.11
Š diluted(5) U.S.$0.09 €0.08 €(0.02) €(0.55) €(1.16) €0.10
Dividendperordinaryshare(6) - - - - - -
DividendperADS(6) - - - - - -
AtDecember31,
(Inmillions) 2015(1) 2015 2014(2) 2013(2)(3) 2012(2)(3) 2011(2)(3)
StatementofFinancialPositionData
Totalassets U.S.$25,826 €23,783 €22,005 €22,638 €22,011 €24,995
Marketablesecuritiesandcashandcash
equivalents 7,092 6,531 5,550 6,355 4,929 4,472
Bonds,notesissuedandotherdebt-long-
termportion 5,030 4,632 4,875 4,922 3,954 4,290
Currentportionoflong-termdebtand
short-termdebt 629 579 402 1,240 851 323
Capitalstock 165 152 141 140 4,653 4,651
Equityattributabletotheequityowners
oftheparentafterappropriation(7) 4,643 4,276 2,406 3,675 2,595 4,643
Non-controllinginterests 982 904 833 730 745 747
(1)Translatedsolelyforconvenienceintodollarsatthenoonbuyingrateof€1.00=U.S.$1.0859onDecember31,2015.
(2)2014,2013,2012and2011amountsarerestatedtoreflecttheimpactofachangeinaccountingtreatment(seeNote4).2012and2011arenotaudited.
(3)2013,2012and2011amountsarere-presentedtoreflecttheimpactsofdiscontinuedoperations(seeNote9totheconsolidatedfinancialstatementsforthe
yearendedDecember31,2014).
(4)Based on the weighted average number of shares issued after deduction of the weighted average number of shares owned by our
consolidatedsubsidiariesatDecember31,withoutadjustmentforanyshareequivalent:
–ordinaryshares:2,808,608,666in2015,2,767,026,349in2014,2,431,168,718in2013,2,396,818,408in2012and2,393,578,923in2011.
(5)Dilutedearningspersharetakesintoaccountshareequivalentshavingadilutiveeffectafterdeductionoftheweightedaveragenumberofshareequivalents
ownedbyourconsolidatedsubsidiaries.Netincomeisadjustedforafter-taxinterestexpenserelatedtoourconvertiblebonds.Thedilutiveeffectofstock
optionplansiscalculatedusingthetreasurystockmethod.Thenumberofsharestakenintoaccountisasfollows:
–ordinaryshares:2,852,673,640in2015,2,767,026,349in2014,2,431,168,718in2013,2,396,818,408in2012and2,701,421,886in2011.
(6)UnderFrenchcompanylaw,paymentofannualdividendsmustbemadewithinninemonthsfollowingtheendofthefiscalyeartowhichtheyrelate.OurBoard
of Directors has announced that it will propose not to pay a dividend for2015 atourAnnualShareholders’Meeting tobeheldin2016. ADS:American
DepositaryShare.
(7)Amountspresentedarenetofdividendsdistributed.NodividendwasproposedanddistributedasofDecember31,2015,2014,2013,2012and2011.
AlcatelLucent‰AnnualReportonForm20-F2015 3
1
SELECTEDFINANCIALDATA
Exchangerateinformation
1.2 Exchange rate information
Thetablebelowshowstheaveragenoonbuyingrateofeurofor The table below shows the high and low noon buying rates
each year from 2011 to 2015. As used in this document, the expressedinU.S.dollarspereurofortheprevioussixmonths.
term “noon buying rate” refers to the rate of exchange for the
euro, expressed in U.S. dollars per euro, as certified by the Period High Low
Federal Reserve Bank of New York for customs purposes or,
April2016 U.S.$1.1432 U.S.$1.1252
from 2014, the European Central Bank fixing at 3:00 pm Paris
March2016 U.S.$1.1385 U.S.$1.0856
time.
February2016 U.S.$1.1347 U.S.$1.0884
Year Averagerate(1) January2016 U.S.$1.0920 U.S.$1.0742
2015 U.S.$1.1095 December2015 U.S.$1.0990 U.S.$1.0600
2014 U.S.$1.3211 November2015 U.S.$1.1032 U.S.$1.0579
2013 U.S.$1.3303 October2015 U.S.$1.1439 U.S.$1.0930
2012 U.S.$1.2909 September2015 U.S.$1.1419 U.S.$1.1138
2011 U.S.$1.4002
On April 25, 2016, the noon buying rate was €1.00 =
(1)Theaverageofthenoonbuyingrateforeuroonthelastbusinessdayof U.S.$1.1264.
eachmonthduringtheyear.
4 AnnualReportonForm20-F2015‰AlcatelLucent
Activity overview 2
2.1
CoreNetworkingSegment 6
2.2
AccessSegment 7
AlcatelLucent‰AnnualReportonForm20-F2015 5
2
ACTIVITYOVERVIEW
CoreNetworkingSegment
2.1 Core Networking Segment
OurCore Networkingsegmentincludesthreebusinessdivisions:IPRouting,IPTransportandIPPlatforms.In2015,revenuesinour
CoreNetworkingsegmentwere€6,780million,representing47%ofourtotalrevenues.WithinCoreNetworking,IPRoutingrevenues
were€2,669millionin2015,representing39%ofsegmentrevenues,IPTransportrevenueswere€2,450million,representing36%of
segmentrevenuesandIPPlatformsrevenueswere€1,661million,representing24%ofsegmentrevenues.
IP Routing
Description Activities Marketpositions
We are a world leader and privileged We deliver IP routing, Carrier ethernet, Š #2 in Global IP Services Edge Routing
partner of service providers, cable/multi- Network Function Virtualization (NFV) and with 25% market share based on
system operators (MSOs), large Software Defined Networking (SDN) revenuesin2015(1)
enterprises and vertical markets including applicationsandinfrastructurerequiredto
Š #3 in total routing (global) with 20%
transportation, energy, governments in meetthechallengesofsustainingmassive
market share based on revenues in
transforming their networks to an all-IP network traffic growth while supporting
2015(1)
(InternetProtocol)architecture. the efficient delivery of cloud-enabled
business, mobile and residential services. Š #4 in Global IP Services Core Routing
Our technology allows our customers to with 7% market share based on
create a more efficient network revenuesin2015(1)
infrastructurethatenablesnewservicesto
enrich the end-user experience and
createsustainablevalue.
(1)Industryanalysts
IP Transport
Description Activities Marketpositions
Asaleaderinopticalnetworking,wehelp We design, manufacture and market Š #4 in optical networking with 11%
morethan1,000serviceproviders,cable/ opticalnetworkingequipmenttotransport market share based on revenues in
MSOs, large enterprises and vertical information over fiber optic connections 2015(1)
markets including transportation, energy, over long distanceson land(terrestrial)or
governments and large enterprises to under sea (submarine), as well as for
transform their optical transmission short distances in metropolitan and
infrastructures, ensuring reliable transport regionalareas.Theportfolio alsoincludes
of data at the lowest cost per bit and related professional services and
enablingnewrevenuegeneratingservices microwave wireless transmission
andapplications. equipment.
(1)Industryanalysts
6 AnnualReportonForm20-F2015‰AlcatelLucent