ZTE plots new growth strategy after stable first-half earnings
Telecoms equipment manufacturer’s revenue hits 47.76 billion yuan but it still has to write off bad debts totalling 62.28 million yuan
ZTE Corp, the mainland’s largest listed telecommunications equipment manufacturer, predicts further 4G deployment and system upgrades by network operators to fuel its growth for the rest of this year, despite lingering concerns about US export restrictions.
The company also announced an ambitious new strategy around M-ICT, a shorthand for the so-called mobile interconnection of all things, which is expected to transform its operations and expand its businesses over the next five years.
We will vigorously develop smart pipes in association with telecommunication operators
Shares of ZTE reached an intraday high of HK$11.56 in afternoon trading before closing at HK$11.48 on Thursday, up 1.41 per cent, ahead of its interim financial results announcement.
In the company’s regulatory filing, ZTE chairman Zhao Xianming said “the slowdown in global economic growth and increasing uncertainties” would challenge the development of traditional telecommunications industries in the second half of this year.
Zhao, however, expressed optimism over industry investments being “driven by the further deployment of 4G networks, the application of big video and big bandwidth products, and massive connections”.
“We will vigorously develop smart pipes in association with telecommunication operators and help them to evolve into information operators,” he said.
ZTE posted a 9.33 per cent rise in net profit for the first half of this year to 1.76 billion yuan, up from 1.61 billion yuan in the same period last year, on higher 4G network equipment sales to China’s three telecommunications operators, as well as strong information-technology services demand from governments and businesses around the world.