Lenovo Group, China's largest personal computer producer, announced Thursday net profit growth of 12 percent to 365 million HK dollars (47.16 million US dollars) in the third fiscal quater that ended on Dec. 31.

The group's consolidated revenue for the third quater increased 392 percent on a yearly basis to 31.1 billion HK dollars (4.02 billion US dollars), Mary Ma, the group's senior vice president and chief finance officer, said at a press conference here.

Ma attributed Lenovo's growth in the third quater to robust sales in personal computer and mobile telephones on the domestic market.

Over the same period, Lenovo, which purchased IBM's personal computer division last May, reported consolidated revenue of 11.5 billion HK dollars (1.49 billion US dollars) on the domestic market, or 37 percent of the company's total.

"The acquired business has now been profitable for three consecutive quarters, in line with the board's expectations, although regional performance has varied," said Yang Yuanqing, chairman of Lenovo.

Despite of the growth of net profit, the company's gross profit margin in the third quarter, 13.2 percent, was lower than that of the previous quater of 14.0 percent, noted Yang.

The higher the gross margin is, the more efficiently an enterprises is operated.

Already enjoying a market share of 37 percent in China, Lenovo is facing great margin pressure and difficulty to seek further growth, admitted Yang.

The company, therefore, will focus on increasing operational efficiency, improving cost and expense structure, and broaden products line to meet new customer needs.

Lenovo will also seek to make profits from its overseas operation, which still has potential in the fast-growing market of small and medium business besides the high-end markets of existing corporate customers of IBM's products.

The group reported revenue in the Americas of 8.9 billion HK dollars (1.15 billion US dollars) and that in the Europe, Middle East and Africa region of 196 million HK dollars (25.32 million US dollars).

Revenues in the two above regions represented 29 percent and 22 percent of Lenovo's total revenue, which were described as "steady " performance in a statement issued by the group.

Source: Xinhua