Lenovo 2012 Annual Report Download - page 17

2011/12 Annual Report Lenovo Group Limited 15
For the fiscal year ended March 31, 2012, the Group’s
consolidated revenue increased by 37 percent year-
on-year to record-high US$29,574 million. Under the
personal technology products and services, revenue of the
Group’s PC and related business were US$27,191 million,
representing a year-on-year increase of 31 percent; whilst
the revenue of MIDH business, which was largely from
mobile phone revenue in China, increased 85 percent year-
on-year to US$1,484 million. Meanwhile, revenue of other
goods and services were US$899 million.
The Group’s gross profit increased by 46 percent year-on-
year to US$3,446 million and gross margin increased from
10.9 percent in the previous fiscal year to 11.7 percent,
driven by effective margin management, strong unit
shipment growth and stringent cost control.
Operating expenses increased by 44 percent year-on-year
to US$2,862 million, with an expenses-to-revenue ratio of
9.7 percent. The Group continued to enjoy good scaling
benefits from its strong shipment growth, but as it needed
to continue its investments in product innovation, branding,
MIDH business and emerging markets, to drive long-term
sustainable growth and better profitability, which resulted in
a higher expenses-to-revenue ratio compared to last year.
The Group achieved a record-high profit before taxation of
US$582 million and profit attributable to equity holders of
the company amounted US$473 million, representing an
increase of 63 percent and 73 percent, respectively, from
the previous fiscal year.
PERFORMANCE OF GEOGRAPHIES
During the year ended March 31, 2012, Lenovo achieved
strong performance in all geographies where it has
operations, gaining PC market share across the board in
China, Emerging Markets (excluding China) and Mature
Markets. The Group achieved record high PC market share
in China, Mature Markets and Emerging Market (excluding
China).
Lenovo ranked number one in two of the top three PC
markets in the world, namely China and Japan, in the fiscal
year 2011/12.
China
China accounted for 42 percent of the Group’s total
revenue. Although the government’s tightening measures
to curb inflation remained in place, leading to softer
economic growth, China’s PC market continued to
outgrow the worldwide PC market, driven mainly by the
relatively stronger demand in emerging cities. According
to preliminary industry estimates, the China PC market
grew by 13 percent year-on-year during the fiscal year, and
became the largest PC market in the world.
REVENUE BY GEOGRAPHY (%)
China
Mature Markets
Emerging Markets (Ex. China)
2012
2011 46% 18% 36%
42% 16% 42%
LENOVO CHINA MARKET SHARE
AND PC SHIPMENT YTY GROWTH (%)
Market Share Lenovo Markets
0
40
0
45
Q4
11/12
Q3
11/12
Q2
11/12
Q1
11/12
Q4
10/11
Q3
10/11
Q2
10/11
Q1
10/11
28.2
31.4
26.9
31.4 31.2
35.2
30.0
22.7%
9.7%
28.7