Chinese telecommunications equipment manufacturer ZTE announced today (20 January 2014) that it expects to post of profit of between RMB 1.2 billion (£120m) and RMB 1.5 billion (£150m) for 2013, following a large-scale improvement in profitability in its major operations.
The company attributed the profitability to ‘stringent control of expenses’, and a ‘closer scrutiny of business that offered lower margins’. ZTE said it ‘also strengthened management of cash flow and account receivables, resulting in a large increase in operating cash flow. Sales, administrative and research and development expenses were reduced from a year earlier’.
ZTE added that it had made it a priority to improve operational efficiency and returns on investment, alongside business growth.
In 2013, ZTE strengthened the company’s execution in major product groups and markets, and provided improved services and support to key customers. In China, ZTE capitalised on what it described as the company’s early-mover advantage in the 4G LTE network to consolidate its leading position in the market. ZTE said it achieved major breakthroughs in the telecommunications markets in South Africa and Spain, and became a top-four smartphone provider in the United States.
In 2014, ZTE said it is committed to pursuing further reforms in its operations to add new flexibility and vitality to the company. The company will intensify its focus on key businesses and operations, and strive for higher efficiency.
In the Operator Solutions division, ZTE ‘will leverage its leadership of the 4G market in China to grow its operations internationally, and target significant breakthroughs in the development of 4G equipment, mobile devices and chipsets’.
In the Mobile Devices division, ZTE ‘will focus on user experience and branding to establish increased rapport with consumers, marrying a new mindset with the company’s traditional technological advantages’.
In the Enterprise division, the company is ‘committed to the development of advanced and industry-leading technology solutions, and aims to achieve increased competitiveness’.
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