It's going to get worse before it gets better, but our strong balance sheet means we're well placed to ride the COVID-19 storm. That was the main message to shareholders from Börje Ekholm, Ericsson's CEO, ahead of today's AGM.

In a 20-minute video recorded at his home, Ekholm – who won't be turning up at the AGM in person, preferring to participate via a link – said that Ericsson had not yet seen any significant business disruption from the coronavirus outbreak.

But Ericsson can't realistically expect to escape unscathed, not least because of financial hardship suffered by numerous industries. "We assume and plan for the fact that we will be affected," said Ekholm.

He added, somewhat ominously, that Ericsson's management team may need to take "necessary measures."

What that might mean exactly was not made clear. More job losses are clearly a possibility, but, since he was addressing shareholders, a dividend cut may well be in the offing if things go a little pear-shaped.

The good news, maintained Ekholm, was the balance sheet. According to the CEO, "underlying" cash flow in 2019 – an impressive 17.7 billion Swedish kronor (US$1.8 billion) – was the best Ericsson performance in 10 years. A net cash position of SEK34 billion ($3.4 billion) at the end of 2019, argued Ekholm, also gave Ericsson more resilience in times when trading conditions are less favorable.

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Cash flow was nonetheless hit because of fines doled out by the US Department of Justice and the Securities Exchange Commission, amounting to around $1 billon, over a bribe scandal spanning China, Africa and the Middle East. (See Ericsson Paid Out Millions in Bribes While CEO Ekholm Sat on Board.)

Ekholm tried to draw a line under the whole sorry episode, and even managed to talk about an upside.

"Let me get one thing straight," he said. "The events that have been brought to light in this investigation are completely unacceptable. For the company to have an independent compliance monitor for three years will most certainly demanding, but I look at it as a way of ensuring that we get a first-class ethics and compliance programme that's fit for purpose."

— Ken Wieland, contributing editor, special to Light Reading