The Business And Financial Performance Of Lenovo Group Ltd. Over A Three Year Period

2586 words - 11 pages

Research and analysis project
Topic 8
The Business and Financial Performance of Lenovo Group Ltd. over a Three Year Period

By:Bai Xu
ACCAstudent number:2111479
May 2014

Word count:

1.1 Reasons For Choosing The Topic
The main reasons for me to choose this topic are as follows:

I have chosen Topic 8 : the business and financial performance of an organization over a three year period for the Research and Analysis project.As a full-time ACCA student I have completed Fundamental Level of ACCA exams and learnt a lot from ACCA subject such as F7 F9.So that it provides me necessary ...view middle of the document...

Lenovo computer is very close to my daily life,I use it almost everyday. Nearly every company needs computers in their day-to-day running of business.Lenovo is China's largest personal computer maker by market share.Almost every Chinese know this brand,and is quite popular and has a good reputation all over the world.

In these days more and more people have their own laptop, and computers begin to play a more important role in our daily life. I am very interested in how a computer company’s financial performance would like to be and how a computer company will do further to influence people’s life.And with my analysis of its financial performance I would like to dig more about Lenovo Group Ltd .and to provide some constructive opinions hopefully.
1.3 Company Background
"Lenovo" is a portmanteau of "Le-" (from Legend) and "novo", Latin ablative for "new". Liu Chuanzhi founded Legend in 1984 with a group of ten engineers in Beijing with only RMB200,000, (US$25,000) .

In the beginning of the company formed its name is Legend. Their first significant move was to import televisions but unfortunately it failed.Then Legend started to developing a circuit board that would allow IBM-compatible personal computers to process Chinese characters.It was the first success achievement of Legend.The company also tried to enter into digital watch market but failed.Legend’s early obstacle was that their staff didn’t have that much business experience.

Legend became a public list company in 1994 and raised nearly $30 million.The company was commended for their good management,good brand reputation and growth potential.Yuanqing Yang became Legend’s chairman and CEO in 2001.
The company’s name changed from Legend to Lenovo Group Ltd in 2004.In the same year Lenovo became a international Olympic committee partner .

Lenovo acquired IBM's personal computer Division in 2005, including the ThinkPad laptop and tablet lines.The acquisition made Lenovo became the world third-largest computer maker. William J. Amelio is appointed as CEO and President of Lenovo.

Lenovo Technology supports the 2006 Olympic Winter Games in Torino, Italy, supplying 5,000 desktop PCs, 350 servers and 1,000 notebook computers in2006.
Lenovo forms a joint venture with EMC to selling servers in China and develop storage solutions in 2012.
Lenovo acquires Stoneware, a software firm focused on cloud computing in 2012
Lenovo announces it will acquire CCE, a leading consumer electronics company in Brazilin2012.(

This diagram below shows a brief picture of the revenue analysis by different product types and geographical segments based on FY2013.

From figure1.31 notebook computer is the main revenue driver, formed more than half of total revenue. The second is desktop computer with about 31% of the turnover.

From figure 1.32, Lenovo’ s main presence is in China, formed almost half of total revenue.The second is Europe-Middle East-Africa (EMEA) is...

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