Lenovo Australia and New Zealand edging down for 2018

Deferred tax benefit of AU$10.5 million makes the bottom line for Lenovo ANZ look very rosy.

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Image: Sandra Vogel/ZDNet

On paper, it could appear that Lenovo ANZ had an absolute bumper of a year, with after-tax profit for the year ending March 31, 2018, coming in at AU$12.6 million against AU$0.7 million the year prior, but it doesn't tell the full story.

Revenue for Lenovo's Australian and New Zealand operations totalled AU$719 million compared to AU$737 million a year prior. Services revenue was down by a quarter on 2017's AU$31.3 million number to AU$23.3 million, while revenue from sales trickled down by 2.3 percent from just shy of AU$700 million to AU$683 million.

Consequently profit before income tax fell to AU$5.22 million from AU$5.78 million a year prior.

Although the company said it paid AU$5.5 million in income tax for 2018, AU$2 million lower than in 2017, the company also received a deferred tax benefit of AU$10.6 million that gave a AU$12 million turnaround in the income tax line item. Lenovo ANZ reported a tax benefit of AU$7.3 million for 2018, compared to an expense of AU$5 million for a year prior.

The company said as of the end of March 2018 that it has 168 employees in ANZ, and its immediate parent is the Netherlands-based Lenovo International.

For the overall Lenovo Group, the company in November reported second quarter profit before tax of $213 million. The company said it was the third consecutive quarter of double-digit growth.

As has become customary for Lenovo, the company unveiled new units of its Thinkpad X1 line at the recent CES.

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