Lenovo Group (LNVGY) reported results for its first fiscal quarter of 2007/08, ended June 30, 2007, and says consolidated revenue for the quarter grew 13 percent, year over year, to US$3.9 billion.
"In the past two years, through the formulation of the right strategy and effective execution, Lenovo's performance is showing signs of growth," said Lenovo Chairman Yang Yuanqing. "We are seeing signs from the strategic implementation of our integration plan that tell us the acquisition is on the path to success. Building upon a solid, healthy foundation, Lenovo has the ability to grow faster and tap the growth potential of the PC industry. We will not only improve the competitiveness of our existing business, but also actively expand the consumer business worldwide."
Lenovo's worldwide PC shipments grew more than 22 percent in the quarter, well ahead of the industry average growth of approximately 13 percent.
Lenovo's gross profit margin for the first quarter improved to 14.9 percent, compared to 14.3 percent in the same period a year ago, and down 30 basis points sequentially. Excluding restructuring charges taken in the first quarter, pre-tax income increased 258 percent to US$123 million. Net cash reserves as of June 30, 2007 totaled US$1.3 billion.
In April 2007, Lenovo announced an action plan to strengthen its global competitive position and increase operational efficiency worldwide. As a result, Lenovo's reported results reflect a restructuring charge relating to the plan of approximately US$45 million taken in the first fiscal quarter, which ended June 30, 2007. Reflecting that restructuring charge, Lenovo reported pre-tax income of US$78 million and basic earnings per share for the first quarter of 2007/08 of 0.78 US cents.
