China will continue to be a key, strategic market for Lucent Technologies as it pushes for sustained profitability, according to Patricia Russo, its board chairwoman and chief executive officer.

"China holds great promise for us,'' she said yesterday in Beijing.

The company posted a profitable quarterly earning report by the end of September, reversing 13 successive quarterly losses since March 2000.

The company recorded a net revenue of US$99 million in the fourth fiscal quarter this year.

"Given the ups and downs in the telecommunications market, we expect the profit in fiscal year 2004 to remain flat,'' Russo said.

"We have no specific guidance for profit target and cash flow in fiscal year 2004.''

According to Russo, sectors such as broadband access, metropolis optical networks, third generation (3G) wireless telecommunications and services will be the major avenues for profitability.

"The Chinese market is tremendous,'' she stressed, adding the company's local operation will be a key part of its sustained profitability in the following quarters.

China, one of the world largest telecommunications markets, has more than 500 million telephone subscribers.

Also, the fast development of the national economy has lent great impetus to the telecommunications market, Russo said.

"We will continue to invest in the market,'' she said, without elaborating.

The chairwoman is in China to attend the 10th anniversary of Lucent Technologies Telecommunications Equipment Co Ltd in Qingdao, East China's Shandong Province.

It accomplished sales of US$992 million last year, up 123 fold compared with 1993. Company exports stood at US$250 million last year.

Lucent Technologies (Qingdao) has become one of Lucent's four system integration centres worldwide.

In September, Lucent kicked off its research and development centre in Nanjing, capital of East China's Jiangsu Province.

As for China's 3G deployment, Russo said she believes there is great business potential for Lucent as its provides code division multiple access solutions.

It is widely anticipated that the Chinese Government will release 3G licences no later than the end of next year.

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