Update | ZTE shares jump as Chinese telecoms giant returns to profit
ZTE made profit of 4.55 billion yuan in 2017, rebounding strongly from a net loss of 2.36 billion yuan a year ago, according to preliminary results
Shares of China’s largest listed telecom equipment supplier, ZTE, jumped as much as 6.5 per cent in Hong Kong on Friday morning as preliminary results showed the company had returned to profit.
ZTE made profit of 4.55 billion yuan (US$720 million) in 2017, rebounding strongly from a net loss of 2.36 billion yuan a year ago, according to a preliminary announcement on Thursday evening.
The stock opened 2.8 per cent higher at HK$27.3 on Friday, and rose to HK$28.3 by about 10am, an increase of 6.5 per cent from yesterday’s closing price of HK$26.55. It lost some ground in the afternoon, closing 3.96 per cent higher at HK$27.6.
The company attributed the turnaround in profits to investments in global telecommunication networks, the development of overseas markets for handsets, and growth of its three key business segments – carrier, consumer, and government and corporate.
ZTE is due to release its detailed results for 2017 on March 15.
The company paid about US$826 million to the US government in 2017 towards settling penalties for its violation of long-standing trade sanctions on Iran and North Korea.