ZTE Reports Q3

SHENZHEN, China -- ZTE Corporation (“ZTE” or the “Group”) (H share stock code: 0763.HK / A share stock code: 000063.SZ), a leading global provider of telecommunications equipment and network solutions, today announced its 3Q results ended 30 Sep 2009.

During the reporting period, ZTE succeeded in gaining further inroads in the market segment comprised of multi-national carriers with its LTE, UMTS and GSM products. This success was attributable in large part to leveraging opportunities presented by the need for network construction in emerging markets against the backdrop of an improving global economic environment. The Group reported 2009 revenue to-date from principal operations of RMB42,843 million (USD 6. 274 billion), representing growth of 41.27% as compared to the same period last year, while net profit attributable to the parent company grew 46.13% to RMB1,192 million (USD 175 million). Basic earnings per share amounted to RMB0.68 (USD 0.10).

In the third quarter, the Group reported revenue from principal operations of RMB15,136 million (USD 2.216 billion), representing growth of 42.81% as compared to the same period last year, while net profit attributable to the parent company grew 58.18% to RMB409million (USD 60 million). Basic earnings per share amounted to RMB0.23 (USD 0.03).

In terms of market development, the Group reported substantial growth in operating revenue largely attributable to large-scale 3G network construction in the domestic China market. In tandem with carrier requirements for fusion and complementary technologies, ZTE has placed more emphasis on integrated product and service strengths and superior price performance ratios, laying solid groundwork for overall business growth and further market share gains. Internationally, the Group was well-geared for a stronger competitive position on the back of its cost advantage, financing resources and customisation abilities. The changing competitive landscape also provided strong opportunities for breakthroughs in key markets and product areas.

Product-wise, ZTE’s carrier network segment reported year-on-year growth of 47.32%, which was driven mainly by revenue generated from sales of the Company’s 3G network equipment, optical transmission products and data communication products. Revenue from terminal products also grew by 38.67%, which was in line with sales growth for 3G products. Revenue from the Group’s telecommunications software systems, services and other products grew by 17.85%, reflecting primarily growth in the sales of fixed terminals.

Looking to the final quarter of the year, the Group will pursue its strategies in greater depth with a focus on enhancing its capabilities in strategic applications and operations. Continuing to leverage opportunities presented by the changing competitive landscape, ZTE will continue to strengthen cooperation with mainstream international carriers. Core to ZTE’s strategy will be to seek increased presence in key markets such as Western Europe and North America while reinforcing its position in the China 3G market, incorporating balanced and sustainable business development.

ZTE Corp. (Shenzhen: 000063; Hong Kong: 0763)