ZTE Corporation (000063) posted a 36.62 percent year-on-year drop in 2011 net profit to 2.06 billion yuan despite a 23.39 percent year-on-year increase in revenue to 86.25 billion yuan, reports Securities Daily, citing a company filing. Earnings per share hit 0.61 yuan.

The company announced cash dividends of two yuan (including tax) for every 10 shares held.

According to group chairman Hou Weigui, the company faced challenges arising from the slowing global economy and the adjustment in domestic monetary policy that resulted in a fall in the gross profit margin.

ZTE had a gross profit margin of 30.26 percent in 2011, down 2.03 percentage points from a year ago.

The company reported negative operating cash flow of 1.81 billion yuan in 2011.

Hou said ZTE will seek to improve on its cash management.

The company plans to issue six billion yuan worth of five-year corporate bonds this year in order to repay bank loans, adjust debt structure, and supplement operating capital.

The domestic market contributed revenue of 39.5 billion yuan, accounting for 45.79 percent of total sales, while the international market accounted for 46.76 billion yuan.

Source:capitalvue.com