Lenovo has a good cash position within declining PC sector
Lenovo’s results for fiscal 2012-13 showed earnings of $635 million, up 34% year-over-year, and full year EPS of $6.16. The company had 52.4 million PC shipments and holds 15.5% global market share. Lenovo is focused on transforming itself into a “PC Plus Leader” by adding tablets and smartphones to its core PC business. As of March 31, it had net cash reserves of $3.1 billion, which decreased 25% from 2012.
The company asserts it has a very liquid position, and during the previous fiscal year drew $300 million from a five-year loan facility agreement that was entered into in July 2009. It has another $500 million loan facility agreement that hasn’t been used and short-term credit facilities of $6.9 million. Bank borrowings increased 179% to $176 million due to Lenovo’s acquisition of CCE, a consumer technology company in Brazil.