Lenovo Group announces third quarter results for 2014

Absrtact: Lenovo Group reported its third-quarter results in 2014, with a turnover of 14.1 billion U.S. dollars, an increase of 31% per cent, and a third-quarter pre-tax profit (excluding the non-cash costs of mergers and acquisitions in accounting processing) that rose 8% to $348 million a year earlier. Performance growth is the core of personal electricity

Lenovo today reported third-quarter results in 2014, with a turnover of $14.1 billion trillion, up 31% per cent year-on-year, and a third-quarter pre-tax profit (excluding the non-cash costs of mergers and acquisitions in accounting processing) that grew 8% to $348 million a year. Performance growth is driven by the core PC business, as well as the high-speed integration of Motorola Mobility and the former IBM x86 server (System x) two new acquisitions.

Earnings show that Lenovo generated the non-operational, mergers and acquisitions in the accounting processing of non-cash costs of a total of 74 million U.S. dollars, including the acquisition of Motorola and system x generated by the intangible assets amortization and acceptance of bills interest costs. If the acquisition in the accounting process derived from the Non-cash costs, quarterly pre-tax profit of 274 million U.S. dollars, cut 15%. In the same way, the quarterly net profit was $253 million trillion, down 5%. Excluding the Non-cash costs derived from accounting processing, the quarterly net profit was $327 million trillion, up 23% per cent.

Lenovo is in the midst of an important transition, diversifying its business and joining Motorola and System X's new operations, while maintaining a strong growth in its core PC business. The balanced development of the group business has become Lenovo's core advantages: The personal computer business accounted for 65% of turnover, mobile business accounted for 24%, enterprise-class business accounted for 9%. Only a year ago, the PC business accounted for 81% of the group's total turnover.

"Last quarter was the quarter we started again from the new start." Our performance proves that our strategy is correct, that the selected acquisitions are appropriate, that implementation is effective, and we are fully prepared for a new round of success. "Not only has our core personal computer business maintained a leading position, but we have honoured our commitment to improve profitability, and our two new acquisitions have shown good momentum in the first quarter of consolidation as a new growth engine," said Yang, chairman and CEO of Lenovo Group. Motorola's quarterly sales broke through 10 million for the first time and a strong return to the Chinese market. For System X, we are developing further integration plans to leverage the scale effect and Lenovo's efficiency advantages to enhance its competitiveness. We are confident of achieving our financial goals for the year and achieving sustainable long-term growth. ”

Lenovo's gross margin in the third quarter grew 54% to 2.1 billion dollars, with a gross margin of 14.9%. Quarterly operating profit fell 3% to 325 million dollars year-on-year. The third quarter per share of the basic profit of 2.32 cents or 17.99 cents. On December 31, 2014, the net cash reserve was 1.3 billion dollars.

Lenovo's drive to transform its business model has boosted sales and profitability. Including the Yoga family series of flip notebooks and tablet computers introduced last October. In addition, Lenovo in January CES launched the most frivolous Lavie notebook and so on.

PC group business profit Innovation high

Personal Computer groups (PCG, including PCs and Windows tablets) have a turnover of $9.2 billion trillion, and pre-tax profits have been high, to $494 million trillion. The group's PC sales in the quarter were 16 million, up 4.9% per cent, accounting for 20% of global market share. The market integration trend will be conducive to Lenovo development. In addition, Lenovo's ThinkPad notebook computer sales Breakthrough 100 millionth, creating a milestone for the brand of excellence.

Mobile business pre-tax loss of USD 89 million

Mobile business groups (MBG, including Motorola, Lenovo-branded smartphones, Android tablets and smart TVs) have a turnover of 3.4 billion U.S. dollars and a pre-tax loss of $89 million. Motorola's quarterly sales topped 10 million, up 118% from a year earlier, bringing 1.9 billion of dollars to the mobile business group.

Combined with the total sales of Motorola and Lenovo branded equipment, Lenovo has become a truly global maker, the world's third-largest expert maker after Samsung and Apple, and the biggest challenger to the two brands. At present, Lenovo and Motorola two brands accounted for a total of 6.6% of global market share, an increase of 78%. With the newly released yoga tablet, Tablet PCs have a global market share of 4.8%, with sales of 3.7 million units in the quarter, up 9% from a year earlier.

Unlike other mobile-phone companies that are smaller and almost entirely reliant on slowing growth in China, Lenovo has 60% of smartphones in the past two years from outside China and has entered 67 countries.

Corporate Business group pre-tax loss of USD 42 million

The sales of servers, storage, and software and services sold by the Enterprise business Group (EBG, including the Thinkserver and the System X business (formerly IBM x86 server business)) amounted to $1.2 billion, while System X's turnover was $986 million. Within only 90 days of System X's merger and acquisition consolidation, enterprise-class business groups have made pre-tax profit, although they lost $42 million before the standard tax, which includes mergers and acquisitions, which are derived from Non-cash charges. Enterprise-class business is now moving towards a 5 billion dollar turnover in a year and a solid goal to achieve a better profit level than personal computers.

Combined with Lenovo Thinkserver and System x server sales, Lenovo has ranked third in the global x86 server market, accounting for 10.4% of the market share. Last year, while the market has become more stable since Lenovo said it planned to acquire the system X business, Lenovo has leapt to the top of the Chinese market as the business has grown rapidly in the Chinese market, and has gained new opportunities in 160 countries around the world, both IBM and Lenovo have never seen before.

Europe/Middle East/Africa region market share 29% of global market

Lenovo's turnover in China in the third quarter rose 1% to $4.1 billion cloak, accounting for 29% of the group's total global turnover and a cloak increase of 0.3% to 5.7% per cent in annual profit margins. In the third quarter, Lenovo continued to consolidate its leading position in the Chinese PC market, with a market share of 38.2% per cent. The fierce competition in China's smartphone market has affected the performance of Lenovo's smartphone.

In the Asia Pacific region, Lenovo's third-quarter turnover year cloak grew 7% to $1.7 billion, accounting for 12% of the group's total global turnover, and its operating profit margin rose 3.9% to 5.4% per cent in the year, a record high. At the same time, the personal computer market share also innovation high, up to 16.1%, year cloak up 0.2%. In the ASEAN region, smartphone sales have been strong.

In the European/Middle East/Africa region, Lenovo's third-quarter turnover continued to grow at a high rate of 40% (1.6 billion U.S. dollars) to $4 billion, with operating profit margins rising by 1.2% to 3% per cent cloak. Due to the strong performance of the consumer business, the region in Lenovo's total global turnover accounted for a higher than 29%. During the quarter, Lenovo's PC market share in Europe/Middle East/Africa rose by nearly 4.4% to 19.6%, a record high, and ranked number one in 13 countries in the region, continuing to consolidate Lenovo's second-highest position in the European/Middle East/Africa region's PC market.

In Americas, with the addition of Motorola and System X business, Lenovo's turnover in the region in the third quarter was USD 4.3 billion, with an annual cloak growth of 88%, accounting for 30% of the group's total global turnover. The share of the Americas PC market is 11.1%. Lenovo continues to rank fourth in the U.S. market, while avoiding fierce competition with lower-end and low-margin products to protect its profitability. In North America, Lenovo's turnover and sales have grown strongly, profitability has risen steadily, and the challenges in Brazil's business have had an impact on the overall performance of Americas, and the group is taking aggressive and decisive steps to deal with it.