The world's No.4 personal computer maker said on Thursday that a restructuring plan that included layoffs cost it $146 million in the full fiscal year.

It said it expected the market to remain tough this year, though one bright spot could be a burst of stimulus spending in its home market of China, where the government has embarked on a campaign to bring more electronics to the countryside.

"The worldwide PC market showed year-on-year negative growth in the second half of the 2008/09 fiscal year, caused by the widespread economic slowdown," Lenovo said in a statement.

"No country was immune ... Lenovo's performance in various geographies was also affected in varying degrees.

Lenovo lost some global market share during the fiscal year to rivals Dell Inc, Hewlett Packard Co and Acer Inc, but continued to expand its dominance in China, raising its market share to 30 percent from 28 percent.

The company said analysts expected the PC market to remain weak in 2009, with global unit shipments expected to decline. The move to lower-cost computers would also exert pressure, it said.

"The group expects the operating environment to remain very challenging in the 2009/10 fiscal year," it said.

But Chairman Liu Chuanzhi said the upcoming roll-out of third-generation (3G) wireless mobile services in China and government stimulus spending there could provide some relief.

"The telecoms companies have been developing the 3G market, so there will be rapid growth in this area and we will take advantage of that," he told reporters at a media briefing. "The government stimulus spending is going to help our company tremendously."

He said Lenovo hoped to return to profit but gave no timetable, and there were no plans for further layoffs.

Optimism about the 'China effect' has helped Lenovo's stock to more than double in value since the beginning of March.

By: DocMemory
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