Lenovo Profit Soars on Sales Abroad EARNINGS MARKETPLACE By Bloomberg

May 24, 12:10 PM

Current Headlines: By Janet Ong

Lenovo, one of the world's largest makers of personal computers, said Wednesday that its profit for the year that ended March 31 rose to $161.1 million from $22.2 million a year earlier helped by job cuts and winning market share in Asia from Hewlett-Packard and Dell. Ten analysts had an average full-year profit estimate of $124 million in a survey compiled by Bloomberg. Sales rose to $14.6 billion from $13.3 billion in the period.

Lenovo, based in Raleigh, North Carolina, raised fiscal full- year profit with increased sales of branded computers outside China. The chief executive, William Amelio, plans to finish cutting 5 percent of employees this year, saving $100 million, after the acquisition of International Business Machines' PC unit in 2005.

"The result is a surprise and partly due to the strong performance in the U.S.," Mark Po, an analyst at UOB Kay Hian in Hong Kong, said. "If Lenovo wants to be a global player, it must have a presence in the U.S., the world's biggest PC market."

Lenovo's shares rose 1 cent to 3.21 Hong Kong dollars, or 41 U.S. cents, in Hong Kong before the announcement. Shares of Lenovo have plunged 78 percent since the peak in March 2000, as profit fell on costs to merge the IBM PC unit.

Lenovo said it would pay a final dividend of 2.8 Hong Kong cents, unchanged from a year earlier, for a full-year payout of 5.2 cents.

Amelio said the fourth quarter was the "best quarter since the IBM acquisition." He said the company would consider various options to raise funds, without providing details.

Lenovo's desktop computer business returned to profit in the last quarter after the company relocated the unit to China, Amelio said.

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