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Huawei global sales revenue to reach CNY238-240 billion in 2013, up ~11.6 percent in USD year-on-year; annual R&D investment exceeds CNY 33 billion
Jan 15, 2014 11:00

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Huawei global sales revenue to reach CNY238-240 billion in 2013, up ~11.6 percent in USD year-on-year; annual R&D investment exceeds CNY 33 billion

CFO underscores innovation as essential to drive long-term growth

[Beijing, China, January 15, 2014]: Huawei, a leading global information and communications technology (ICT) solutions provider, today announced unaudited financial results for 2013 which indicate continued strong growth and sales momentum.

2014, Jan 15, Beijing, China,Huawei Chief Finance Officer Cathy Meng announces 2013 operating performance. Huawei global sales revenue will reach CNY238-240 billion in 2013, up ~11.6 percent in USD year-on-year. The annual R&D investment will be about CNY 33 billion.

Huawei’s global sales revenue will reach between CNY238 billion to CNY 240 billion (Exchange rate: USD1 = CNY6.0569, as at December 31, 2013) in 2013, an increase of ~8 percent (~11.6 percent in USD) year-on- year. Chief Financial Officer Cathy Meng announced that Huawei's operating profit for 2013 is expected to be in the range CNY28.6 billion to CNY29.4 billion. Cash flow from operating activities and the company’s asset to liability ratio remained stable. In 2013, Huawei restructured a number of processes to simplifying its management structure and ensure improvements in operating efficiency.

Huawei’s achieved new business growth across its carrier network, enterprise and consumer business groups. More than 75 percent of the carrier network business group’s revenue in 2013 came from the world's top 50 telecom carriers, while the proportion of revenue from services and software in the carrier business increased to 37 percent in 2013 from 34 percent in 2012. Huawei also generated rapid growth in its consumer and enterprise business groups.

Huawei's continued growth, despite an increasingly competitive landscape in the global ICT industry, can be attributed to the company’s continued commitment to innovation. Huawei strengthened its investment in innovation to support fundamental scientific and engineering technologies while ensuring alignment with its customer needs.

Ms Meng said, "Every year for over the past 10 years, Huawei has invested more than 10 percent of sales revenue in innovation. In 2013 alone, the company's investment in R&D reached CNY33 billion, accounting for about 14 percent of our sales revenue." This means Huawei’s annual investment in R&D exceeded 5.4 billion USD for the first time.

Huawei’s continued profitability was supported by improved efficiencies and reductions in internal management and operating costs. In 2013, Huawei implemented a number of restructuring processes such as a reorganization of its corporate management, new training programs to motivate its staff, as well as a strengthening of roles and responsibilities for frontline management and a programme to ensure field-based teams are equipped with the best tools and information to make informed and effective business decisions. In addition, Huawei significantly enhanced its internal management and operations – shifting its operating model from function-centric to project-centric and boosting investments in R&D – to improve the company’s operating profit margin.

From 2004 to 2013, Huawei invested a total of CNY153.9 billion in R&D and innovation. As a global leader in LTE technology, Huawei has been the recipient of multiple prestigious industry awards, including recognition for most innovative network and best commercial network globally. Huawei is also a pioneer in 5G technologies and the company is committed to investing USD 600 million by 2018 in support of research and innovation into 5G mobile network technologies. Huawei’s 400G core router technology is one of the most technologically-advanced in the industry worldwide.

"No matter where we are, from Mount Everest to the Norwegian LTE base station in the northernmost part of the globe, or the dense and stifling Amazon rainforest, customer-centricity and a solid reputation for delivering on our commitments and contracts are basic principles that our 150,000 dedicated employees in more than 140 countries around the world adhere to. This spirit of dedication has won us the trust of our customers," said Ms. Meng.

Ms. Meng added, "In addition, openness, cooperation, and win-win are core Huawei values. We advocate and adhere to open collaboration across the industry value-chain and continuously strive to build business ecosystems that are characterized by resource and risk sharing, as well as win-win benefits, while providing high-quality, innovative products and services to our customers."

As part of the company’s commitment to promoting a vibrant ICT industry through partnerships, Huawei has selected 389 suppliers based on the supplier portfolio management results and their performance, and have fulfilled a supplier prepayment of approximately USD1 billion in 2013.

"The physical world and the digital world are merging at an accelerating pace. In the next decade, more people will spend more time using more applications. This will generate more need for data and services, thus increasing the momentum of network and device development. We are dedicated to be a leader of the ICT infrastructure industry. While we continue to focus on our business and innovation strategy and the ongoing process of simplifying our management structure throughout 2014, Huawei will also work to achieve effective long-term growth and lay the foundation for the company's development over the next ten years," said Meng.

Unaudited financial results; Huawei’s audited results to be announced in the second quarter of 2014

Exchange rate: USD1 = CNY6.0569 (as at December 31, 2013)

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