Huawei hints at IPO plans

Huawei estimates it grew its 2012 profit by 33% to 15.4 billion yuan (€1.8 billion), and has hinted that it is open to an IPO.
 
The Chinese vendor's unaudited results, announced yesterday, also show an anticipated 8% increase in revenue to 220.2 billion yuan.
 
Huawei's core carrier business group generated revenue for the year of 160.3 billion yuan, compared to 48.4 billion yuan for its consumer group an 11.5 billion yuan from the enterprise segment.
 
The company also revealed that it now generates 66% of its overall revenue from outside of China, including 37.4 billion from the Asia-Pacific region in 2012.
 
Huawei is forecasting a further 10% to 12% increase in revenue for 2013.
 
At a briefing to discuss the results, CFO Cathy Meng Wanzhou said the company is keeping an “open mind” about the possibility of conducting an IPO, Bloomberg reported. But she added that the decision would depend on whether it is in the employee-owned Huawei's shareholder interest.
 
An IPO would likely make Huawei more transparent, which may go some way towards helping to convince suspicious western governments to drop their distrust of the vendor.
 
Bloomberg also notes that Huawei's expected revenue for 2012 slightly beats the average of analysts' estimates for Ericsson's annual results.
 
ZTE has meanwhile warned it expects to report a loss for 2012 of up to 2.9 billion yuan ($466.1 million).
 
The company is blaming delays in some domestic and international network projects and a decline revenue at its handset unit.
 
The result compares to a 2011 profit of 2.06 billion yuan ($331.1 million), but this was itself down 36.6% from 2010.
 
But ZTE added that it expects to swing back to profit in 1Q13, as a result of turnaround efforts including greater cost controls.

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