HONG KONG -Friday 16 August 2019 [ AETOS Wire ]
- Group revenue grew year-on-year for eight consecutive quarters, reaching US$12.5B in Q1 FY19/20
- PTI more than doubled to US$240M year-on-year, up US$127M
- Net income was US$162M, up US$85M year-on-year, also more than doubling
- One in every four PCs built worldwide is a Lenovo PC, thanks to record market share of 24.9%
(BUSINESS WIRE)--
Lenovo Group (HKSE: 0992) (PINK SHEETS: LNVGY) today announced group
revenue in the first quarter reached US$12.5 billion, the eighth consecutive
quarter of growth. Pre-tax income more than doubled year-on-year, growing by
US$127 million to reach US$240 million. Net income also more than doubled, up
US$85 million to US$162 million.
Basic earnings per share for the
first quarter were 1.37 US cents or 10.74 HK cents.
“This fiscal year kicked off to an
excellent start. Once again, this quarter’s strong results provided solid
evidence that Lenovo’s Intelligent Transformation is enabling the company to drive
sustainable, profitable growth in today’s dynamic and changing world. Our
persistent execution and operational efficiency allows us to bring our vision
to life and deliver smarter technology for all,” said Yang Yuanqing, Lenovo
Chairman and CEO.
Global trade environment
The first quarter results signal
that Lenovo continues to thrive – outperforming the market and leading the
global tech sector in spite of industry-wide geopolitical and trade
uncertainties. Lenovo is positioned better than most given a globally balanced
revenue mix, footprint across 180 markets, and more flexible majority-owned
manufacturing base. To date there has been negligible material impact on the
business. Looking ahead, the global scale and breadth of the business ensures
Lenovo is well positioned to manage complex and dynamic market conditions,
while delivering sustainable long-term results.
Business Group Overview
The strong results are led by the Intelligent
Devices Group (IDG). The PC and Smart Devices Group (PCSD), one of
its two business units, continued double-digit (12%) revenue growth while
achieving its highest-ever profit in a fiscal first quarter, and further
improving industry leading profitability. Pre-tax income was US$524 million, up
US$98 million. Americas and Asia Pacific achieved 20% and 40% year-on-year
revenue growth respectively and all four geographies (Americas, Asia Pacific,
China, EMEA) each delivered over US$2 billion in revenue, demonstrating the
geographical balance and sustainability of this business.
In PCs, volume outgrew the market,
which as a whole is experiencing a recovery, by over 13 points, and the group
hit an all-time record PC market share of 24.9%. This means one in every four
PCs built in the world is a Lenovo PC – cementing Lenovo’s position as the
worldwide number one in PCs.
These strong results are driven by
innovation, a customer-centric product portfolio and continuing focus on
operational excellence. This strategy enables the company to outgrow the market
significantly across high-growth and premium categories including Workstation,
Thin and Light, Visuals, Gaming PCs and Chromebook. Looking forward, the PC and
Smart Device group will continue to drive premium-to-market growth and
industry-leading profitability by focusing on premium segments as well as
innovating in Smart IoT, commercial Smart IoT and developing new devices for
homes and offices.
IDG’s second business unit, the Mobile
Business Group (MBG), delivered another profitable quarter and improved
pre-tax income by US$100 million for the 4th consecutive quarter. In
the North America market, volume outgrew the market by more than 37 points and
pre-tax income margin improved by over 14 points year-on-year. In the company’s
Latin America stronghold, volume has grown with or above the market for 11
quarters.
Going forward, the mobile business
will continue to maintain profitability and seek opportunities to drive
profitable growth in new markets with new innovative products.
The Data Center Group (DCG)
continued to improve profitability year-on-year for the eighth consecutive
quarter. Storage revenue grew more than 80% year-on-year and Software Defined
Infrastructure (SDI) continued to grow at a double-digit rate year-on-year.
Overall revenue declined due to a small number of large cloud customers
reducing their purchasing after rapid infrastructure growth over the past year
and a lower average unit revenue due to declining component prices. In High
Performance Computing the company extended the Number 1 position in the Top 500
Supercomputer list to 173 systems across 20 markets – continuing to support
ground-breaking scientific research and applications around the world.
The group will continue to expand as
a full stack Data Center player, driving SDI, storage, networking, HPC, AI,
IoT, service and solution led sales while strengthening in-house design and
manufacturing capability for Hyperscale. In addition, the business will further
improve routes-to-market and operational excellence to achieve premium to
market growth, while improving profitability.
About Lenovo
Lenovo (HKSE: 992) (ADR: LNVGY) is a
US$50 billion Fortune Global 500 company, with 57,000 employees and operating
in 180 markets around the world. Focused on a bold vision to deliver smarter
technology for all, we are developing world-changing technologies that create a
more inclusive, trustworthy and sustainable digital society. By designing,
engineering and building the world’s most complete portfolio of smart devices
and infrastructure, we are also leading an Intelligent Transformation – to
create better experiences and opportunities for millions of customers around
the world. To find out more visit https://www.lenovo.com, follow us on LinkedIn, Facebook, Twitter, YouTube, Instagram, Weibo and read about the latest news via our StoryHub.
|
LENOVO GROUP
FINANCIAL SUMMARY
For the first quarter ended June
30, 2019
(in US$ millions, except per share
data)
|
||||
|
|
|
|
|
|
|
|
|
Q1 19/20 |
Q1 18/19
|
Y/Y CHG |
|
Revenue
|
|
12,512
|
11,913
|
5%
|
|
Gross profit
|
|
2,048
|
1,632
|
26%
|
|
Gross profit margin
|
|
16.4%
|
13.7%
|
2.7pts
|
|
Operating expenses
|
|
(1,705)
|
(1,452)
|
18%
|
|
Expenses-to-revenue ratio
|
|
13.6%
|
12.2%
|
1.4pts
|
|
Operating profit
|
|
343
|
180
|
90%
|
|
Other non-operating expenses - net
|
|
(103)
|
(67)
|
52%
|
|
Pre-tax income
|
|
240
|
113
|
113%
|
|
Taxation
|
|
(48)
|
(28)
|
75%
|
|
Profit for the period
|
|
192
|
85
|
125%
|
|
Non-controlling interests
|
|
(30)
|
(8)
|
259%
|
|
Profit attributable to equity
holders
|
|
162
|
77
|
111%
|
|
EPS (US cents)
|
|
|
|
|
|
Basic
|
|
1.37
|
0.65
|
0.72
|
|
Diluted
|
|
1.32
|
0.65
|
0.67
|
View source version on
businesswire.com: https://www.businesswire.com/news/home/20190814005796/en/
Contacts
Hong Kong – Angela Lee, angelalee@lenovo.com, +852 2516 4810
London – Charlotte West, cwest@lenovo.com, +44 7825 605720
Zeno Group - LenovoWWcorp@zenogroup.com
London – Charlotte West, cwest@lenovo.com, +44 7825 605720
Zeno Group - LenovoWWcorp@zenogroup.com
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