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Huawei loses key contract [Daily Mail, London](Daily Mail (London, England) Via Acquire Media NewsEdge) Oct. 30--The Chinese phone firm behind TalkTalk's TV boxes and EE's mobile phones has been forced to write a pounds sterling 20m IOU to one of its biggest customers in Britain after bungling a contract. Huawei is the UK's third biggest phone maker, and manufactures the EE-branded Kestrel smartphones. But the majority of its business is installing and running telecoms infrastructure equipment for companies such as BT and Vodafone. The Mail can reveal the group has been suspended from a major contract and forced to issue a pounds sterling 20m credit voucher to network operator Three. In 2012 Huawei was brought in to manage the performance of Three's network of 9m customers on a five-year contract thought to be worth tens of millions of pounds. But after Huawei missed key performance targets, the network decided to take the work in-house. Huawei has set aside pounds sterling 20m in order to write a 'voucher' to Three allowing it to get discounts on future work over the next three years, its latest accounts reveal. The company admitted it was still locked in talks with the provider when the accounts, which were for 2013, were written. Huawei has other contracts with Three, which have not been affected. The accounts show that the provision pushed the company to an annual loss of pounds sterling 5.5m, compared to a pounds sterling 9.8m profit in the previous year. This means it did not have to pay tax, and actually received a pounds sterling 348,000 tax credit. The previous year it had paid pounds sterling 3.1m in corporation tax. Sales during the year rose 16pc to pounds sterling 476.6m. A spokesman for Huawei said: 'Three is an important customer of Huawei, both here in the UK and around the world, and like all our customers, we work closely with them to meet their requirements.' A spokesman for Three said: 'Back in 2013 we took the decision to rescope aspects of how we manage our network, taking direct management of network operations.' ___ (c)2014 Daily Mail (London, ) Visit the Daily Mail (London, ) at www.dailymail.co.uk/home/index.html Distributed by MCT Information Services |