Comtech Group (COGO) has expanded its relationship with ZTE, a leading original equipment manufacturer of mobile phone handsets in China.

ZTE has recently been awarded a contract with China Unicom in which Comtech will provide their LCD module interface solution to the ZTE handset designated for fulfillment of the initial order.

The ZTE order from China Unicom will be for approximately one million CDMA units. Comtech's dollar content per phone approximately $1.20 per unit, with the total order scheduled for delivery during the next six months. This represents an initial order and if the handset is well received follow on orders are possible.

Additionally, ZTE's first Smartphone has been adopted by China Mobile's seven provinces as the preferred selling model. With this validation the product should have a successful introductory rollout. Comtech is providing a storage module solution for this product as well, and management anticipates 60,000 to 100,000 units delivered during the Company's fourth fiscal quarter.