July 25 (SeeNews) - Croatian telecommunications equipment manufacturer Ericsson Nikola Tesla [ZSE:ERNT-R-A] said on Tuesday its first-half consolidated net profit declined 26.8% on the year to 37.4 million kuna ($5.9 million/5.0 million euro).
"The absence of tax incentives for R&D activities has directly impacted the decrease in net profit year-over-year", the company said in a bourse filing.
The company's operating profit increased 3.7% year-on-year to 52.9 million kuna through June, while sales revenues decreased 2.9% to 709 million kuna.
Of the total sales revenue, 19.5% was generated on the domestic market, services to parent Ericsson accounted for 65.8%, while other export markets had a 14.7% share.
In the southeast European markets where Ericsson Nikola Tesla operates, namely Bosnia and Herzegovina, Montenegro, and Kosovo, first-half sales revenue dropped 25.3% on the year to 49.6 million kuna due to unfavourable economic conditions and an unstable political situation.
In the first half, the company hired 145 new experts, which increased its employee force to 3,017 people.
Sweden's Ericsson owns 49.07% of the Croatian company.
(1 euro=7.41154 kuna)