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ZTE forecasts strong improvement in Q3 profit

2013-08-21 14:59:00| Telecompaper Headlines

(Telecompaper) ZTE has forecast a strong improvement in profits in the third quarter, following an increased focus at at the Chinese equipment maker on high-margin contracts over volume. The company said profit for the first nine months of 2013 will be between CNY 500 and 750 million, reversing a loss in the year-earlier period. This means third-quarter profit could be as much as twice the CNY 310 million reported for the first six months of the year. The first-half profit was up 26.6 percent from a year earlier, helped by cost reductions and a financial gain from the disposal of its stake in Shenzen ZNV Technology. Revenue in the first six months decreased 11.9 percent to CNY 37.58 billion, as Chinese operators slowed spending in preparation for the launch of LTE tenders and other operators around the world took a more cautious stance on investments. Revenues in China fell 10 percent year-on-year to just over half the total, or CNY 18.8 billion, while Asia and Africa each showed drops of over 20 percent, and revenues in Europe and the Americas were down just 4.4 percent. According to product, carrier network equipment recorded sales of CNY 19.1 billion, down 10.5 percent from a year earlier; terminals generated CNY 12.5 billion, down 12.5 percent; and software, services and other products had revenues of CNY 6.1 billion, down 14.8 percent.

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