Lenovo Drives Strong Fourth Quarter and FY2017/2018 Results; Innovation and Efficiencies Power Continued FY2018/2019 Improvement
Lenovo Group (HKSE: 0992) (PINK SHEETS: LNVGY) today announced results for its fourth fiscal quarter and full fiscal year ended March 31, 2018. For its fourth fiscal quarter FY2017/18, Lenovo reported US$10.6 billion in revenue, up 11% year-on-year - the first double digit increase in 10 quarters - demonstrating solid performance momentum.
In the fourth fiscal quarter Lenovo’s group pre-tax income was US$37 million, up 143% year-on-year from US$15 million. The company also improved profitability in all three key businesses for the quarter year-on-year, with group operational performance1 improving US$255 million year-on-year to US$76 million. Profit attributable to shareholders for Q4 was US$33 million, lower than the same period last year due to a larger tax credit recorded in FY2016/17.
For the full fiscal year, the company’s overall revenue was over US$45.3 billion, up 5 % year-on-year. Group operational performance reached US$193 million, improving US$96 million year-on-year. The company recorded a US$189 million net loss for the full year mainly due to a one-time non-cash write-off charge of US$400 million from deferred income tax assets in Q3 FY2017/18.
Basic earnings per share in the fourth fiscal quarter was 0.28 US cents or 2.19 HK cents, and for the full year basic loss per share was 1.67 US cents or 13.05 HK cents. Lenovo’s Board of Directors declared a dividend of 2.61 US cents, or 20.5 HK cents per share for the fiscal year ended March 31, 2018.
Business Group Overview
- Lenovo continued to execute on its three-wave strategy, emphasizing leadership in core businesses, growth in key segments and investment in emerging technologies. All three of Lenovo’s key business groups demonstrated strength and momentum in both the fourth quarter and fiscal year
- Personal Computers and Smart Devices (PCSD) reported US$7.7 billion in FYQ4 revenue, up 16% from the same period a year earlier and the highest growth in four years. For the year, PCSD reported US$32.4 billion, up 8% from FY2016/17
- The Data Center Group (DCG) revenue grew 44% during the quarter compared to Q4 FY2016/17 to US$1.2 billion. For the year, DCG reported US$4.4 billion in revenue, up 8% from FY2016/17
- The Mobile Business Group (MBG) revenue for Q4 FY2017/18 was US$1.3 billion and for the full year was US$7.2 billion. Lenovo remains optimistic that aggressive cost-cutting and exceptionally strong performances by MBG in Latin America (volume grew 40% year-on-year for the full year), or more than 20 times the industry) and North America (volume +57% year-on-year for the full year) are expected to yield substantially improved results as FY2018/19 continues
“Last quarter, we resumed double-digit revenue growth with strong profitability improvement year-on-year, closing the fiscal year with a strong momentum and proving that Lenovo has truly entered a new phase of growth,” said Yang Yuanqing, Lenovo Chairman and CEO. “Lenovo’s vision has long been to become a global leader in intelligent transformation. We will focus on building competitiveness in Smart IoT devices, data center infrastructure and vertical intelligent solution, and we are well positioned to take advantage of smart IoT and intelligence era.”
During the quarter Lenovo also announced the integration of its Personal Computer and Smart Devices Group with its Mobile Business Group, creating the Intelligent Devices Group (IDG). This new group will further fast-track the company’s innovation leadership and ambitions for growth across the full spectrum of smart devices. This new structure will create a number of efficiencies by leveraging shared global supply chain and services. IDG will also accelerate Lenovo innovation as communications and computing technologies come together under a single platform to better connect devices, users, applications and content.
ADDITIONAL BUSINESS GROUP HIGHLIGHTS
PC and Smart Devices (PCSD) business group: During the fourth quarter, PCSD posted strong revenue growth of 16% compared to the same period a year earlier. For the year, PCSD reported an 8% increase in revenue, and remained the world’s #1 PC and Tablet maker2, with market share growing 0.2 points to 15.6% globally. Additionally:
- Returned to industry-leading PTI margin of 5% in Q4 FY2017/18. All geographies continued to be profitable with margin expansion in four out of five
- Strong, double-digit, year-on-year revenue growth across regions in the Americas, Asia Pacific, and EMEA
- Focused strategy in high-growth segments paying off with strong double-digit shipment growth year-on-year in both Gaming (+42%) and Workstation (+32%) in FYQ4. Both surpassed the US$1 billion-dollar scale in FY2017/18 with gaming reporting double-digit revenue growth year-on-year
- Named Best Laptop Brand 2018 by LAPTOP Magazine for a second consecutive year
Data Center Group (DCG): The Data Center group is well positioned to provide the infrastructure for the smart IoT era and continues to be a significant growth business for Lenovo. The group’s financial performance serves as a tangible proof point that the DCG strategy is yielding significant results:
- In Q4 FY2017/18 delivered second consecutive quarter of double-digit year-on-year growth and achieved highest revenue growth (+44%) since the IBM System x acquisition in 2014 – with all geographies showing positive year-on-year revenue growth
- North America and EMEA posted their fourth consecutive quarter of strong year-on-year revenue growth
- Software Defined Infrastructure (SDI) continued strong revenue growth - 130% year-on-year
- HPC solidified the number two position globally in the top 500 Supercomputing list, fast closing the gap to number one player
Mobile Business Group (MBG): During the quarter MBG moved with urgency to reshape the business for future growth and to accelerate progress toward profitability. This included the appointment of Sergio Buniac to lead the business outside of China; a realignment of the product portfolio ahead of forthcoming launches; overall channel inventory reduction, and a strategic market review to identify the opportunities for most profitable growth.
- In Q4 FY2017/18 Latin America remained the strong core for MBG, recording double-digit (13%) year-on-year revenue growth
- In North America, shipments continued to show strong, year-on-year growth as Lenovo strengthened presence with mainstream models and carrier expansion. North America shipments grew 54% year-on-year for Q4 and gained 1.1pts of market share to 3.8% in Q4 FY2017/18
- Expense reduction for the new fiscal year as part of a strategy to reduce loss and focus on strengthening MBG’s leading position and profitability in Latin America, North America and Western Europe by simplifying the portfolio, optimizing the cost structure and leveraging shared platforms
Lenovo Capital and Incubator Group: Lenovo continues to be a beneficiary and driver of some of the most robust trends in global technology innovation, notably artificial intelligence. Lenovo’s investment arm, Lenovo Capital and Incubator Group (LCIG), funded 85 companies during the past years, and oversaw eight independent spin-offs.
Lenovo (HKSE: 992) (ADR: LNVGY) is a US$45 billion Fortune 500 company with a vision to become the global leader in Intelligent Transformation through smart devices and infrastructure that create the best user experience. Lenovo manufactures one of the world’s widest portfolio of connected products, including smartphones (Motorola), tablets, PCs (Thinkpad, Yoga, Lenovo Legion) and workstations as well as AR/VR devices and smart home/office solutions. Lenovo’s next generation data center solutions (ThinkSystem, ThinkAgile) are creating the capacity and computing power for the connections that are changing business and society. Lenovo works to inspire the different in everyone and build a smarter future where everyone thrives. Follow us on LinkedIn, Facebook, Twitter, Instagram, Weibo, or visit us at http://www.lenovo.com/
For the fiscal quarter and full year ended March 31, 2018
(in US$ millions, except per share data)
|Gross profit margin||14.5%||14.3%||0.2pts||13.8%||-0.4pts|
|Other non-operating expenses- net||(64)||(59)||9%||(234)||28%|
|Profit/(loss) for the period/year||49||104||-53%||(127)||N/A|
|Profit/(loss) attributable to equity holders||33||107||-69%||(189)||N/A|
Earnings/(loss) per share (US cents)
1 Operational performance is measured as profit before taxation, but excluding restructuring charges and disposal gains on properties
2 Source: IDC Quarterly Personal Computing Device Tracker, 2018Q1 Final Historical
Om Business Wire
(c) 2018 Business Wire, Inc., All rights reserved.
Business Wire, a Berkshire Hathaway company, is the global leader in multiplatform press release distribution.
Følg saker fra Business Wire
Registrer deg med din epostadresse under for å få de nyeste sakene fra Business Wire på epost fortløpende. Du kan melde deg av når som helst.
Siste saker fra Business Wire
Traxens Gains Confidence of Tens of Top 500 Beneficial Cargo Owners20.2.2019 07:00:00 | Pressemelding
Traxens, expert in providing high-value data and services for the supply chain industry, today announces that it signed several contracts with some of the top 500 Beneficial Cargo Owners (BCO), including major companies such as BASF. Under the terms of the agreements, Traxens provides door-to-door data monitoring solutions for smart containers supplied by partnering shipping lines. BCOs are typically industrial companies importing and exporting large volumes of goods in containers. Traxens’ customers operate in various industries such as aeronautics, pharmaceuticals, chemicals, automotive and foods. These firms require cutting-edge data monitoring systems for easy and reliable management of stocks, actionable analytics and cost reductions. Traxens’ Supply Chain Diagnostic solution enables near real-time monitoring with custom alerts through its web application Traxens-Hub or direct back-end integration, as well as bespoke analysis of transportation performance, thus enabling process op
Sonitor® Technologies AS Spins-Out Forkbeard as Subsidiary and Establishes New Corporate Structure20.2.2019 07:00:00 | Pressemelding
The Board of Directors of Sonitor Technologies AS announced today that it is establishing Sonitor IPS Holding AS (Indoor Positioning Systems) and creating two subsidiaries; Sonitor Technologies AS and Forkbeard Technologies AS. Forkbeard Technologies will focus on the development of platform technologies for cloud-based, indoor positioning of mobile devices. Sonitor Technologies will continue to focus on the commercialization and expansion of the market leading Sonitor Sense™ platform and will partner in the commercialization of the Forkbeard™ technology platform in healthcare and other markets. “After careful consideration, the Board of Directors has determined that separating Sonitor into two independent entities will accelerate the growth and development of each and lead to greater shareholder value,” said Carl Christian Gilhuus-Moe, PhD, Executive Chairman, Sonitor Technologies AS. “The current Sonitor Board of Directors will continue as the board of directors for Sonitor IPS Holdi
Guidewire Software Announces Hexaware as New Consulting Alliance Partner19.2.2019 21:15:00 | Pressemelding
Hexaware Technologies, a fast growing automation-led, next generation provider of IT, BPO and consulting services, and Guidewire Software, Inc. (NYSE: GWRE), provider of the industry platform Property and Casualty (P&C) insurers rely upon, today announced that Hexaware has joined Guidewire PartnerConnect™ as a Consulting alliance member at the Select level. With over 20 years’ experience working with P&C insurers, Hexaware has developed value-add solution and technology offerings that enable insurers to rapidly adopt Guidewire InsuranceSuite™ and Guidewire Digital products, increasing speed to implementation, mitigating execution risk, and lowering costs. Hexaware has supported Guidewire customer success in APAC and EMEA and offers localized solutions for insurers in these regions. “Digital technology is disrupting the P&C insurance industry at an unprecedented rate, and insurers are leveraging market-leading platforms, such as Guidewire InsurancePlatform™, to deliver differentiated pr
IFF Acquires The Additive Advantage; Expands Scent, Taste, and Actives Delivery Capabilities19.2.2019 21:15:00 | Pressemelding
Regulatory News: International Flavors & Fragrances Inc. (NYSE: IFF) (Euronext Paris: IFF) (TASE: IFF), has expanded and strengthened its innovation capabilities for scent, taste and active ingredients through the acquisition of The Additive Advantage (TAA), a company that develops novel technologies with diverse capabilities that span applications and industries. TAA has the expertise to develop the next-generation delivery systems technology platform that will enable the printing of flavors, fragrances, cosmetic and health & nutrition actives onto a variety of consumer products. IFF Chairman & CEO Andreas Fibig said, “The acquisition of TAA helps to expand our large portfolio of offerings to customers in a truly unique way – through print technology. With the expertise that this talented group of people brings under our roof, we envision taking delivery systems to a completely new level and ultimately enriching how consumers experience our customers’ products.” “We are genuinely exci
Rockwell Automation and Schlumberger Enter Joint Venture Agreement to Create Sensia, the Oil and Gas Industry’s First Fully Integrated Automation Solutions Provider19.2.2019 21:05:00 | Pressemelding
Rockwell Automation (NYSE: ROK), the world’s largest company dedicated to industrial automation and information, and Schlumberger (NYSE: SLB), the world's leading provider of technology for reservoir characterization, drilling, production, and processing to the oil and gas industry, announced today that they have entered into an agreement to create a new joint venture, Sensia, the first fully integrated digital oilfield automation solutions provider. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20190219005851/en/ The transaction is expected to close, and the joint venture is expected to begin serving customers, in the summer of 2019, subject to regulatory approvals and other customary conditions. The Sensia joint venture will be the first fully integrated provider of measurement solutions, domain expertise, and automation to the oil and gas industry. It will offer scalable, cloud and edge-enabled process automation, includin
IDEMIA Will Present Its 2018 Annual Financial Results to Investors on February 20, 201919.2.2019 16:07:00 | Pressemelding
IDEMIA, the world leader in Augmented Identity, today announced that it will present its 2018 annual financial results to investors on Wednesday February 20, 2019. Yann Delabrière (CEO), Laurent Lemaire (CFO), and Frédéric Beylier (COO) will be presenting the financial results and taking questions the same day at 4:00 pm CET (3:00 pm London Time / 10:00 am New York Time). For more information, please refer to our website: http://investors.oberthur.com About IDEMIA IDEMIA, the global leader in Augmented Identity, provides a trusted environment enabling citizens and consumers alike to perform their daily critical activities (such as pay, connect, travel and vote), in the physical as well as digital space. Securing our identity has become mission critical in the world we live in today. By standing for Augmented Identity, an identity that ensures privacy and trust and guarantees secure, authenticated and verifiable transactions, we reinvent the way we think, produce, use and protect one of