March 29, 2024

Huawei Springs Back With 33% Rise in Net Profit

BEIJING — Huawei Technologies, one of the largest makers of telecommunications equipment in the world, bounced back from a disappointing 2011 with a 33 percent rise in net profit for 2012 and forecast stronger revenue growth, buoyed by smartphone sales and cloud computing.

Huawei’s chief financial officer, Cathy Meng, the daughter of the company’s founder, Ren Zhengfei, denied that U.S. security concerns would hamper the privately held company’s growth and said Monday that it would keep “an open mind” about a possible stock market listing.

“Cloud computing is a huge sector in the next five years,” Ms. Meng told a results presentation. “In the telecom industry, we are expecting a 5 percent increase in capital investments. Smartphone penetration is still way too low and there is a lot of room for growth. So these three areas will create a lot of opportunities for us.”

Huawei, which ranks behind only Ericsson of Sweden in telecommunications equipment, reported an unaudited net profit of 15.4 billion renminbi, or $2.5 billion, up from 11.6 billion renminbi in 2011, as new telecommunications projects and smartphones increased sales.

Revenue for the year rose 8 percent to 220.2 billion renminbi.

The results were in line with company guidance at the start of the year and came a day after ZTE, its rival, warned of a net loss of as much as 2.9 billion renminbi for 2012.

Huawei is making gains in the enterprise business, which sells networking equipment like routers and switches and has up to now been dominated by Cisco Systems.

Huawei, founded in 1987 by Mr. Ren, a former Chinese military officer, is known for aggressively gaining sales in the telecommunications equipment sector by edging out rivals like Alcatel-Lucent, Nokia Siemens Networks and ZTE.

While Huawei has increased sales and gained market share in Europe, Africa and Asia, it has also run into obstacles in countries including the United States and Australia because of national security and cyberespionage concerns.

The company has been barred from bidding for the rollout of a national broadband network in Australia, faces exclusion from the government network in Canada and is not allowed to sell telecommunications equipment to U.S. carriers.

Article source: http://www.nytimes.com/2013/01/22/technology/huawei-springs-back-with-33-rise-in-net-profit.html?partner=rss&emc=rss

DealBook: SABMiller’s Takeover of Foster’s Gets More Hostile

John Pollaers, chief of Fosters, announced the company's full year results in Sydney in August.Greg Wood/Agence France-Presse — Getty ImagesJohn Pollaers, chief of Fosters, announced the company’s full year results in Sydney in August.

LONDON – SABMiller’s takeover battle for Foster’s Group just became more hostile.

On Friday, the large global brewer accused Foster’s of making “misleading and deceptive” statements in its full-year results presentation last month.

SABMiller — which in August took its $10 billion bid for Foster’s directly to shareholders after getting rejected by the board — has asked Australia’s takeover panel to examine whether the brewer fully complied with accounting standards.

In particular, the London-based brewer called into question Foster’s pro forma net debt figure of 887 million Australian dollars ($948 million). SABMiller also challenged some of Foster’s earnings outlook and asked the takeover panel to look into whether the statements were reasonable. Foster’s said on Aug. 23 that its financial objectives “mid single digit sales growth” and earnings per share to increase faster than operating profit.

SABMiller's Grolsch and Fosters.Simon Dawson/Bloomberg NewsSABMiller’s Grolsch and Fosters.

“SABMiller submits that these statements do not meet the standards required in statements made in the context of a takeover bid and are misleading and deceptive,” the panel said in a statement. “SABMiller seeks final orders that Foster’s make an announcement to the market clarifying the information it claims is misleading and deceptive.”

Spokesmen in London for Foster’s and SABMiller declined to comment. The takeover panel said it had not decided yet whether to conduct proceedings.

SABMiller’s play for Foster’s has been contentious from the beginning.

The global brewer, whose portfolio of brands include Peroni and Castle, first announced a $10 billion bid for the Australian rival in June, but it was quickly rebuffed by the board. Then a few days before Foster’s was set to report earnings in August, SABMiller decided to go hostile in its pursuit, taking the offer straight to shareholders. Once again, Foster’s said the deal “significantly undervalues the company.”

In an attempt to fend off the takeover, Foster’s management last month proposed returning 500 million Australian dollars ($525 million) to shareholders, possibly through a share buyback. Chief executive John Pollaers also said the company was about halfway through a three-year revamp that includes reducing costs and investments in brands.

The move came amid weak earnings results. For the year ended in June, Foster’s reported a loss of 89 million Australian dollars, mainly because of costs linked to the recent spinoff of its wine business.

An acquisition of Foster’s would give SABMiller control of a sizable portion of Australia’s beer industry and seven of the top 10 brands, including the No. 1 beer, Victoria Bitter. Foster’s is losing market share in Australia but the brewer’s profit margins remain high relative to the global industry.

Foster’s shares closed at 4.86 Australian dollars on Friday, below SABMilller’s offer of 4.9 Australian dollars a share. Shares in SABMiller fell 0.5 percent in London in early afternoon trading.

Article source: http://feeds.nytimes.com/click.phdo?i=c0e9ad95067ecdb63fb6577064685acc