Thu. Jun 20th, 2019

China's ZTE Delays Annual Results After US Restrictions

China's ZTE Delays Annual Results After US Restrictions

China’s ZTE said on Thursday it will delay the publication of its annual results because it needs to assess the impact of tough US export restrictions imposed on the telecom equipment maker last week.

The US Commerce Department has imposed restrictions on US suppliers providing crucial components to ZTE for alleged Iran sanctions violations, a move likely to disrupt its global supply chain.

The firm said in a filing to the Hong Kong stock exchange it was unable to finalise its annual results “pending a thorough self-assessment on the potential impacts of the restriction measures on the business and operation of the group.”

ZTE’s board meeting would also be postponed, while its Hong Kong-listed shares would continue to be suspended, it added. The shares last closed at HK$14.16, prior to a trading suspension on March 7.

Reuters reported on Wednesday that ZTE would appeal against the US export restrictions after the firm’s costly lobbying effort failed to allay concerns about its business.

In January, ZTE said preliminary net profit for 2015 rose 43.5 percent to CNY 3.8 billion ($583 million). The company said it aimed to double its annual revenue by 2020.

Hong Kong-listed shares of ZTE have dropped 20 percent so far this year.

ZTE on Thursday also said it is communicating with the US Commerce Department regarding export restrictions for alleged violations of US sanctions on Iran, a spokesman for China’s Commerce Ministry said.

ZTE Corp said on Thursday it will delay the publication of its annual results because it needs to assess the impact of the tough US export restrictions imposed on it last week.