EARNINGS

ZTE eyes overseas projects as profits rise

Partnerships with network operatorson cards after 40.6pc surge in third quarter

PUBLISHED : Wednesday, 28 October, 2015, 2:57am
UPDATED : Wednesday, 28 October, 2015, 2:57am

ZTE Corp, which saw its net profit rise 40.6 per cent in the third quarter, plans to expand partnerships with overseas network operators as large-scale infrastructure deployments continue in its home market.

Shenzhen-based ZTE, China's largest-listed telecommunications equipment manufacturer, on Tuesday reported a net profit of 988.6 million yuan in the quarter to September.

That figure was up from 703.3 million yuan the previous year, on the back of strong global sales to telecommunications network operators.

Revenue grew 7 per cent to 22.6 billion yuan from 21.1 billion yuan a year ago.

In a filing after the close of the Hong Kong market, ZTE chairman Hou Weigui said that domestic and international 4G infrastructure projects would increasingly focus on raising capacity and upgrading performance as their users demanded more "intelligent" systems.

Cynthia Meng, equity analyst at Jefferies, predicted in a report that the company's China-related revenue was likely to be driven by the next phase of China Mobile's nationwide 4G services expansion, and by accelerated 4G network deployments at both China Telecom and China Unicom.

Analyst Ronnie Ho at CCB International said he expected that ZTE would gain global market share because of the "booming 4G infrastructure construction demand from overseas markets like India and Indonesia".

Shares in ZTE slid 0.11 per cent to close at HK$18.86 on Tuesday.