Lenovo outperforms market in Q4 and full year

Strong growth in the PC and Tablet category drives record setting year

Lenovo Group on Wednesday announced results for its fourth fiscal quarter and full-year ended March 31. With record full-year revenue of $38.7 billion, an increase of 14 percent year-on-year, a record full-year pre-tax income of $1.01 billion, up 27 percent year-on-year and record full year earnings of $817 million, up 29 percent, Lenovo had a truly outstanding year.

Lenovo expanded its number one position in PCs, adding 2.1 points of market share to post a record 17.7 percent total share for the full-year, representingfivepercent year-on-year growth, compared to an overall industry decline of 8 percent during this same period. Even while China's PC market slowed, Lenovo's operating profit in China PC improved by 1 percentage point. Asia Pacific had record share of almost 15 percent, while improving profitability.

For the first time, Lenovo's Europe, Middle East & Africa (Lenovo EMEA) revenue surpassed its China PC revenue in the quarter, while in the US, Lenovo surpassed Apple to take the number three position in PC shipments in the fourth quarter. With 20 consecutive quarters of outgrowing the PC market, Lenovo continued to show it can post rapid growth in absolute shipment and in relative market share metrics, even in difficult markets.

When combining Tablets and PCs together to form the PC and tablet category, Lenovo sold a record 64 million devices, up nearly 18 percent year over year, outpacing this market by more than 13 percentage points. Lenovo posted record total device volume of 114 million, up 37 percent year over year. This was the 4th quarter in a row that Lenovo sold more tablets and smartphones than PCs. These facts illustrate Lenovo's transformation as a leader in Smart Connected Devices.

"The record sales and profits that we delivered last year prove that Lenovo can grow and deliver its commitments, no matter the market conditions," said Yang Yuanqing, Lenovo Chairman and CEO.

"We gained three points in tablets by quadrupling sales volume and became the fastest growing major smartphone company in the world. This demonstrates our capability to manage both businesses that are already mature, as well as those that are shifting to maturity. Meanwhile, we are building new engines for growth in the enterprise and ecosystem," said Yang

Gross profit for the full year was $5.06 billion, an increase of 14 percent year-on-year. Gross margin was 13.1 percent, while operating profit for the full fiscal year was $1.05 billion, a 32 percent increase year-on-year.

Lenovo had strong fourth quarter revenue of $9.4 billion, up 19 percent year-on-year. The company achieved pre-tax income of $212 million during the fourth fiscal quarter, a 28 percent increase over the same period last year. The company's gross profit for the fourth fiscal quarter grew to $1.24 billion, an increaseof 18 percent year-on-year. Gross margin was13.3 percent. Operating profit for the fourth quarter was $231 million, up 37 percent year-on-year, while earnings grew 25 percent year-on-year to $158 million. Compared to an overall PC industry decline of 4.6 percent year-on-year in the fourth fiscal quarter, Lenovo grew shipments at a 15 point premium to the market.

Basic earnings per share in the fourth fiscal quarter was 1.53 US cents,or 11.87 HK cents. Lenovo's Board of Directors declared a final dividend of 2.32 US cents,or 18 HK cents, per share for the fiscal year ended March 31, 2014.