Chinese telecoms vendor, ZTE, expects to post a full-year net loss of between RMB2.5 billion ($401m) and RMB2.9 billion in 2012, a decline of up to 240.77% compared to the previous year’s profit.
ZTE said that the expected loss was due to delays in the progress of some domestic and international network projects, the recognition of earlier lower-margin contracts and a drop in revenue for terminal products.
“ZTE will continue to implement the company’s operational review to improve its competitiveness, efficiency and innovation capabilities to lay the groundwork for healthy growth in the future,” the company said in a statement.
The telecoms equipment maker added that it expected to make a profit in the first quarter of 2013 as a result of an “operational review and strategic realignment efforts”.
“The company is steadfastly executing its comprehensive strategic review begun last year to sharpen its focus on key products and markets and strengthen cash flow management,” ZTE said in a statement. “ZTE is generating net cash inflows from operations as the company recorded higher sales collection, achieved increased profitability on new contracts, applied stringent cost controls and recognized investment gains.”