Financial Performance - Service revenue increased by 1% despite intense market competition [2] - Shareholders' profit attributable increased by 4% to $470,000,000 after excluding potential financial investment loss provisions of $201,000,000 [3] - Shareholders' profit decreased by $154 million to $269 million, primarily due to expected credit losses of $201 million [8] - Service revenue increased by 1% to $4,546 million, driven by a recovery in roaming income [8] - Total revenue decreased to $6,763 million from $6,957 million, reflecting weak demand for flagship smartphones [8] - Operating profit for the year was $702,434,000, a decline of 5.5% compared to $743,622,000 in 2022 [17] - Net profit attributable to shareholders was $268,846,000, down 36.5% from $423,170,000 in the previous year [17] - Basic and diluted earnings per share decreased to 24.3 cents from 38.2 cents in 2022 [17] Revenue Sources - ARPU for mobile service plans remained stable at $224; 5G service customer penetration reached 37% as of July 2023, up 9 percentage points from June 2022 [3] - Roaming revenue grew by 49%; revenue from 5G home broadband services increased by over 100% [2] - The 5G home broadband business is expected to continue its growth trajectory, driven by demand from households without fiber network coverage [4] Dividends and Shareholder Returns - The board proposed a final dividend of 17.5 cents per share, totaling 32.0 cents for the year, representing 75% of the company's basic profit [5] - The proposed final dividend for the year ending June 30, 2023, is 17.5 cents per share, an increase from 15.5 cents in 2022, bringing the total dividends for the year to 32.0 cents per share [49] - The company plans to pay the proposed final dividend on November 17, 2023, subject to shareholder approval at the upcoming annual general meeting [49] Financial Position - The company has a strong net cash position of $1,100,000,000 and robust operating cash flow supporting sustainable long-term growth [2] - Net cash flow from operating activities was $2,254 million, with net cash increasing by $459 million to $1,089 million [10] - The group maintained a strong financial position with total equity of $5,084 million as of June 30, 2023 [10] - Total current liabilities decreased to $2,704,204,000 from $4,091,428,000 in 2022 [20] - Total equity as of June 30, 2023, was $5,084,487,000, down from $5,153,784,000 in the previous year [20] Costs and Expenses - Cost of goods sold decreased by 8% to $2,199 million, attributed to reduced sales of smartphones and accessories [8] - Employee costs rose by 12% to $731 million, due to annual salary adjustments and increased investment in human resources [8] - The actual tax rate increased to 40.7% from 29.5%, influenced by non-deductible spectrum usage fees [9] - Total income tax expense for 2023 was $184,537,000, compared to $176,891,000 in 2022, reflecting an increase of about 4.7% [36] Credit and Risk Management - The expected credit loss recorded was $201 million, reflecting changes in credit risk of financial assets measured at amortized cost [9] - The expected credit loss for financial assets measured at amortized cost increased significantly to $201,257,000 in 2023 from $31,000,000 in 2022, highlighting a substantial rise in credit risk [35] - The impairment loss on accounts receivable for the year ending June 30, 2023, was $2,954,000, up from $1,284,000 in 2022 [46] - The company has maintained appropriate and effective risk management and internal control systems for the year ending June 30, 2023 [53] Future Outlook and Strategy - The company anticipates continued intense competition in the mobile communications industry and plans to invest in growth areas [6] - The company aims to leverage new technologies and collaborate closely with its parent company to accelerate smart city development [6] - The company expects no significant impact on its performance and financial position from the newly adopted accounting standards effective from January 1, 2023 [28] Asset Management - Total non-current assets as of June 30, 2023, were $8,496,421,000, a decrease from $9,179,727,000 in 2022 [19] - Total classified assets as of June 30, 2023, were $10,898,943,000, compared to $12,581,132,000 in 2022, reflecting a decrease of approximately 13.4% [32] - Total financing costs decreased to $132,693,000 in 2023 from $145,440,000 in 2022, representing a reduction of approximately 8.7% [34] Shareholder Actions - The company repurchased 359,500 shares during the year ending June 30, 2023, at a total cost of $1,463,000 [51] - The group issued 8 million new stock options during the year, with 1.2 million options exercised [15] Governance and Compliance - The company aims to continue monitoring and reviewing its corporate governance practices to ensure compliance with the corporate governance code [54] - The independent auditor's report for the consolidated financial statements for the year ending June 30, 2023, was unqualified, indicating no significant issues were found [48]

Financial Performance - The company's profit attributable to shareholders increased by 2% to HK$256 million compared to HK$251 million in the same period last year[11]. - The group reported a 2% increase in net profit attributable to shareholders, reaching HK$256 million for the first half of 2022/23, compared to HK$251 million in the same period last year[17]. - Total revenue increased by 1% to HK$3.809 billion, compared to HK$3.792 billion in the same period last year[17]. - The net profit attributable to shareholders for the period was HKD 255,832, up from HKD 252,077, indicating a growth of 1.1%[57]. - Basic and diluted earnings per share for the period were both HKD 23.1, compared to HKD 22.6 in the previous year, marking an increase of 2.2%[57]. - The total comprehensive income for the period was HKD 246,947, slightly down from HKD 249,716 in the same period last year, a decrease of 1.1%[60]. - The total tax expense for the six months ended December 31, 2022, was HK$100,133,000, up from HK$83,436,000 in 2021, representing an increase of 20.0%[95]. Revenue Growth - Service revenue grew by 4%, with the mobile service ARPU rising by 6% year-on-year, driven by the continuous increase in 5G users[11]. - Service revenue rose by 4% to HK$2.333 billion, driven by an increase in 5G users and recovering roaming revenue[17]. - Revenue recognized over time for the six months ended December 31, 2022, was HKD 2,333,030, compared to HKD 2,242,404 for the same period in 2021[81]. Customer Metrics - As of February 2023, 35% of the company's customers are using 5G services, with strong growth momentum continuing[11]. - The number of total customers in Hong Kong slightly decreased by 100,000 to 2.6 million, attributed to the impact of real-name registration requirements[17]. - The average revenue per user (ARPU) for mobile service plans increased by 6% to HK$223, up from HK$210 in the previous year[17]. 5G Network Expansion - The company has expanded its 5G network coverage to over 99% of the population in Hong Kong[6]. - The company is focused on upgrading customers to 5G services, which has positively impacted customer numbers and ARPU[11]. - The company's 5G home broadband service has seen significant growth, providing faster speeds at lower costs for households without fiber coverage[11]. Operational Investments - The company continues to invest in high-growth areas to enhance service and network quality despite rising operational costs[11]. - The company plans to continue investing in 5G infrastructure to enhance network quality and customer experience[14]. - The government has committed to supporting mobile communication investments, which is expected to help control operational costs[14]. Financial Position - As of December 31, 2022, the total equity of the group was $5,230,000,000, with total borrowings amounting to $1,495,000,000[20]. - The cash and bank balances, including short-term bank deposits, were $2,402,000,000 as of December 31, 2022, up from $2,141,000,000 on June 30, 2022[20]. - The net cash position of the group was $1,298,000,000 as of December 31, 2022, compared to $1,021,000,000 on June 30, 2022[20]. - The group generated a net cash inflow from operating activities of $1,245,000,000 for the period ending December 31, 2022[20]. Employee and Management Costs - The total employee costs for the period ending December 31, 2022, were $361,000,000, an increase from $320,000,000 in the same period of the previous year[27]. - As of December 31, 2022, the group had 1,865 full-time employees, an increase from 1,737 employees as of June 30, 2022[27]. - Total remuneration for key management personnel was HKD 14,011,000 for the six months ended December 31, 2022, compared to HKD 11,176,000 for the same period in 2021[126]. Corporate Governance - The audit committee reviewed the interim financial statements for the six months ending December 31, 2022, and found the accounting policies appropriate and consistent with industry standards[156]. - The company adhered to the corporate governance code principles during the six-month period, with a noted absence of some non-executive directors at the annual general meeting[158]. - All directors confirmed compliance with the standard code of conduct for securities transactions during the six-month period ending December 31, 2022[159]. Community and Employee Engagement - SmarTone is committed to community support through various activities aimed at helping those in need and fostering a harmonious society[51]. - The company offers diverse training and career development opportunities for employees, including cross-departmental exchanges and skill training[52]. - SmarTone promotes work-life balance by creating a relaxed work environment and organizing festive celebrations and care activities for employees[53]. Strategic Initiatives - The company has implemented a trial program for 40,000 customers to interact with staff via WhatsApp, receiving positive feedback and plans to expand the service[11]. - The company has partnered with Sun Hung Kai Properties' membership program "The Point," allowing customers to earn points on all spending for various benefits[11]. - The company is exploring international business development opportunities, particularly in the internet and technology sectors[33].

Financial Performance - Revenue for the fiscal year ended June 30, 2022, was HKD 6,957 million, representing a 4% increase from HKD 6,720 million in 2021[11] - Profit attributable to shareholders decreased by 5% to HKD 423 million, down from HKD 445 million in the previous year[11] - Total revenue increased by 4% to HKD 6,957 million, compared to HKD 6,720 million in 2020/21, driven by growth in 5G services and recovery in roaming income[24] - The company's profit attributable to shareholders for the year was $423 million, a decrease of 5% compared to last year's $445 million, while profit actually grew by 16% year-on-year when excluding government subsidies[20] - Basic earnings per share for 2022 was HKD 0.38, compared to HKD 0.40 in 2021, reflecting a decline of 5%[131] - Total comprehensive income for the year amounted to HKD 421,965,000, compared to HKD 458,040,000 in the previous year, reflecting a decline of 7.8%[151] Assets and Liabilities - Total assets increased by 18% to HKD 12,581 million, compared to HKD 10,650 million in 2021[12] - Total liabilities increased significantly to HKD 7,427,348,000 from HKD 5,553,951,000, marking a rise of 33.7%[156] - The total equity attributable to shareholders was HKD 5,153,784,000, a slight increase from HKD 5,097,108,000 in the previous year[156] - Current assets rose to HKD 3,401,405,000, up from HKD 3,187,936,000, indicating an increase of 6.7%[154] Cash Flow - Net cash inflow from operating activities was HKD 2,036 million, a decrease of 16% from HKD 2,420 million in 2021[14] - The net cash generated from operating activities was HKD 2,036,156,000, down from HKD 2,420,431,000, a decrease of 15.8%[157] - Cash outflows from investing activities totaled HKD 2,621,638,000, compared to HKD 1,135,953,000 in the previous year, indicating a significant increase in investment spending[158] Customer Engagement and Services - SmarTone 5G LAB attracted approximately 400,000 visitors since its opening, showcasing various 5G applications[15] - SmarTone Home 5G broadband service targets three customer segments, including those facing slow internet speeds and those needing additional connectivity for remote work[17] - The proportion of 5G users (excluding virtual network operator customers) increased to approximately 28% as of June 30, 2022, contributing to ARPU growth, although the recovery pace remains slow[20] - Customer satisfaction ratings have improved, with a reported increase of 10% in positive feedback from users[114] Corporate Governance - The board consists of three executive directors, five non-executive directors, and seven independent non-executive directors as of June 30, 2022, ensuring a balanced governance structure[35] - All directors are required to retire at least once every three years and be re-elected by shareholders at the annual general meeting[36] - The company has established a policy for independent non-executive directors who have served more than nine years to be subject to a separate resolution for reappointment[36] - The board meets at least four times a year to discuss overall strategy, operational and financial performance, and significant acquisitions or disposals[38] Risk Management and Compliance - The group maintained an effective risk management and internal control system for the year ending June 30, 2022[54] - The company emphasizes the importance of compliance with legal and regulatory requirements, having adhered to all significant laws and regulations affecting its operations as of June 30, 2022[64] - The audit committee's responsibilities include ensuring the accuracy and fairness of the group's financial reporting and compliance with corporate governance regulations[47] Shareholder Information - The target dividend payout ratio is generally set at 75% of the group's annual profit attributable to shareholders[58] - The total dividend for the year is proposed to be HKD 0.30 per share, consistent with the previous year, which includes an interim dividend of HKD 0.155 and a final dividend of HKD 0.145[64] - The company repurchased a total of 5,364,500 shares during the fiscal year ending June 30, 2022, with 5,196,500 shares canceled before this date[101] Strategic Initiatives - The company plans to continue investing in world-class digital infrastructure to support Hong Kong's development as a technology hub and integration with mainland China and the Greater Bay Area[22] - The company is committed to building a 5G network in underserved areas, completing urgent construction work within two weeks during the peak of the pandemic[129] - The company is investing $50 million in R&D for new technologies aimed at enhancing customer experience[117] Community Engagement - The company provided free SIM cards and additional local data services to frontline healthcare workers during the pandemic, ensuring seamless communication[129] - The company supports community initiatives, including the "Smart Elderly Digital Support Program," providing smartphones and free communication services to seniors[128] - The company has engaged in charitable activities, providing free data cards and 5G broadband services to underprivileged families during the pandemic[130]

Financial Performance - Shareholder profit for the period was HK$251 million, a decrease of 6% compared to HK$267 million in the same period last year[14]. - Service revenue increased by 3%, with mobile service ARPU rising by 4% to HK$210[14]. - The group's profit attributable to shareholders slightly decreased to HK$251 million, compared to HK$267 million in the same period last year[20]. - Service revenue increased by 3% to HK$2,242 million, driven by strong growth in 5G customer base and home broadband services[20]. - Total revenue rose by 17% to HK$3,792 million, primarily due to growth in local service revenue and mobile device sales[20]. - Mobile device and accessory sales increased by 44% to HK$1,549 million, attributed to strong sales of 5G flagship devices[20]. - Operating profit for the period was HKD 390,905, representing a 2.3% increase from HKD 380,015 in the previous year[59]. - Net profit after tax was HKD 252,077, a decrease of 4.8% compared to HKD 264,841 in the same period of 2020[60]. - Total comprehensive income for the period was HKD 249,716, compared to HKD 273,480 in the previous year[62]. - Total revenue for the six months ended December 31, 2021, was HKD 3,791,522, an increase of 16.9% from HKD 3,244,313 in the same period of 2020[59]. 5G Services and Infrastructure - Approximately 20% of SmarTone's postpaid customers are currently using 5G services, which offer a significant premium over 4G plans[14]. - The 5G home broadband service has shown strong customer growth, providing faster and more affordable internet options compared to existing providers[14]. - SmarTone's 5G network now covers 99% of the population in Hong Kong, including all major transport routes and quarantine centers[15]. - The company successfully acquired additional spectrum at a reasonable price, resulting in the highest per-customer spectrum resources among all operators[15]. - Over 90% of trial customers for the 5G home broadband service opted for long-term contracts, indicating strong market acceptance[15]. - SmarTone's 5G LAB has attracted around 400,000 visitors, showcasing the potential of 5G applications in business and daily life[5]. - SmarTone has established 5G networks at ten community isolation treatment facilities to support healthcare workers and isolated citizens[52]. - The company implemented a "5G STEM Classroom" initiative to educate local students on 5G applications[54]. Customer Service and Community Support - SmarTone received multiple awards for its customer service, including "Best Quality Service Retailer - Telecommunications" and "Best Store Technology Application - Silver Award" in 2021[8]. - The company provided additional local data, unlimited local calls, and free services to frontline healthcare workers during the pandemic[52]. - SmarTone's team delivered 5G Wi-Fi routers and free local data cards to healthcare workers in isolation facilities[52]. - The company has expanded its community support initiatives, including providing smartphones and free communication services to elderly individuals[53]. Financial Position and Investments - As of December 31, 2021, the group reported total equity of $5,167 million and total borrowings of $1,546 million, maintaining a strong financial position[23]. - Cash and bank balances stood at $2,101 million as of December 31, 2021, slightly up from $2,095 million on June 30, 2021[23]. - The group generated a net cash inflow from operations of $1,060 million during the period, with major outflows for fixed asset purchases and bank loan repayments[23]. - The company is actively investing in building world-class 5G and digital infrastructure, viewing it as key to Hong Kong's development as a technology hub[18]. - Spectrum costs are expected to exceed HK$400 million for the year, with a total of HK$7 billion paid or provided since 2011[18]. Employee and Management Information - Employee costs rose by 28% to HK$320 million, primarily due to the absence of government wage subsidies during the period[20]. - The group had 1,702 full-time employees as of December 31, 2021, with total employee costs amounting to $320 million for the period[29]. - The company has a strong focus on employee development, offering diverse training and career advancement opportunities[55]. - The total remuneration for key management personnel was HKD 11,176,000 for the six months ended December 31, 2021, down from HKD 18,398,000 in the same period of 2020, representing a decrease of approximately 39%[116]. Corporate Governance - The company has a strong commitment to corporate governance, with members actively participating in various committees and boards within the industry[37]. - The board includes members with extensive experience in finance and management, enhancing the company's governance and strategic direction[37]. - The company continues to maintain a strong governance structure with various committees, including audit and remuneration committees[40][43]. - The audit committee reviewed the interim financial statements for the six months ended December 31, 2021, and found the accounting policies and calculations appropriate and consistent with industry standards[140]. - All directors confirmed full compliance with the standard code of conduct for securities transactions during the six months ended December 31, 2021[144]. Shareholder Information - The company plans to continue paying a mid-term dividend of HK$0.145 per share, maintaining the same level as last year[18]. - The company declared an interim dividend of 14.5 cents per share, consistent with the previous year, amounting to HKD 160,767,000[100]. - The company is controlled by Cellular 8 Holdings Limited, which owns 68.72% of the shares, with the remaining 31.28% widely held[115]. - The company reported a significant decrease in performance guarantees from HKD 2,388,884,000 as of June 30, 2021, to HKD 798,383,000 as of December 31, 2021, indicating a reduction of approximately 67%[114].

Financial Performance - Total revenue for the year ended June 30, 2021, was HKD 6,720 million, a decrease of 4% compared to HKD 6,986 million in 2020[11]. - Profit attributable to shareholders increased by 17% to HKD 445 million, up from HKD 379 million in the previous year[11]. - Basic earnings per share rose by 18% to HKD 0.40, compared to HKD 0.34 in 2020[11]. - Service revenue decreased by 5% to HKD 4,339,000,000, with roaming revenue down 58% due to travel restrictions, partially offset by a 2% increase in local service revenue[27]. - Total revenue declined by 4% to HKD 6,720,000,000, mainly attributed to the drop in roaming income[27]. - EBITDA rose by HK$30,000,000 or 1% to HK$2,460,000,000, while operating profit increased by 30% to HK$674,000,000[29]. - The company’s financial performance for the year ending June 30, 2021, is detailed in the consolidated income statement on page 58[77]. - The company reported a profit of HKD 378,985 for the year, compared to HKD 339,617 in 2020, representing an increase of approximately 11.6%[178]. - The total comprehensive income for the year ended June 30, 2021, was HKD 460,023,000, compared to HKD 458,040,000 for the previous year, reflecting a slight increase[181]. Cash Flow and Assets - Net cash inflow from operating activities was HKD 2,420 million, representing a 20% increase from HKD 2,017 million in 2020[13]. - Cash and bank balances stood at HKD 2,095,000,000 as of June 30, 2021, down from HKD 2,251,000,000 a year earlier[30]. - The group maintained a net cash position of HK$994,000,000 as of June 30, 2021, compared to HK$604,000,000 in the previous year[30]. - The operating cash flow for the year ended June 30, 2021, was HKD 2,637,102, an increase from HKD 2,298,821 in 2020, representing a growth of approximately 14.7%[175]. - The total assets amounted to HKD 10,650 million, with current liabilities of HKD 2,660 million, resulting in net assets of HKD 7,990 million[153]. - The total number of shares held by directors and senior management as of June 30, 2021, includes 5,162,337 shares held by Chairman Guo Binglian, representing 0.46% of the issued voting shares[88]. 5G and Digital Transformation - The company launched a 5G bus service in collaboration with KMB, providing passengers with access to SmarTone's 5G network[15]. - SmarTone Solutions is integrating 5G and the latest technologies into end-to-end enterprise solutions to drive digital transformation[17]. - The company has invested significantly in building a world-class 5G network, achieving 99% population coverage in Hong Kong, with independent testing confirming it as the best 5G network in the region[21]. - The 5G Lab, opened in May 2021, attracted approximately 200,000 visitors in three months, including CEOs from major companies, showcasing the potential of 5G technology[22]. - The company anticipates accelerated customer upgrades to 5G services, which will be a key growth driver, alongside increased demand for enterprise application solutions[25]. - New services such as network security and 5G home broadband are expected to generate additional revenue streams for the company[25]. - The company is collaborating with various operators to develop telemedicine services and Smart Health solutions for elderly care providers, indicating a focus on innovative applications of 5G technology[24]. Governance and Board Structure - The board consists of 2 executive directors, 5 non-executive directors, and 6 independent non-executive directors, ensuring a balanced governance structure[39]. - All directors are required to retire at least once every three years and are subject to re-election by shareholders[40]. - The company held 4 board meetings and 1 annual general meeting during the year ending June 30, 2021, with attendance rates of 100% for most directors[43]. - Independent non-executive directors have confirmed their independence in accordance with listing rules, ensuring compliance with governance standards[39]. - The company has arranged appropriate liability insurance for its directors, which is reviewed annually[39]. - The board meets at least four times a year to discuss overall strategy, operational and financial performance, and significant acquisitions or disposals[42]. - The chairman and president roles are held by different individuals to enhance independence and accountability[41]. - The board comprises members from diverse age groups and backgrounds, ensuring a balanced representation[53]. Risk Management and Compliance - The company maintained an effective risk management and internal control system for the year ended June 30, 2021[55]. - The audit committee is satisfied with the independence and objectivity of PwC as the external auditor for the company[59]. - The company emphasizes the importance of accurate revenue recognition due to inherent risks in the telecommunications industry, identifying it as a significant audit risk[161]. - The auditor identifies and assesses risks of material misstatement in the financial statements and designs audit procedures to address these risks[165]. - The group faces significant risks including intense market competition, reliance on effective IT systems, and compliance with regulatory requirements[72]. - The group has established a risk management framework to address all critical operational risks[72]. Shareholder Returns and Dividends - The company plans to pay a final dividend of HK$0.155 per share, resulting in a total annual dividend of HK$0.30 per share, based on a 75% payout ratio[25]. - The proposed final dividend for the year ending June 30, 2021, is $0.155 per share, an increase from $0.15 per share in 2019/20, resulting in a total dividend of $0.30 per share for the year[78]. - The total dividend declared was HKD 333 million, marginally up from HKD 331 million in the previous year[152]. - The group aims for a target dividend payout ratio of 75% of the annual profit attributable to shareholders[69]. Employee Relations and Development - The group emphasizes employee relations, providing training and development opportunities, and fostering communication[75]. - The company has not made any charitable or other donations during the year, consistent with the previous year[82]. - The company provides training records for directors, ensuring they are informed about their responsibilities and the company's operations[46]. Share Options and Incentives - The company has a stock option plan that allows for the issuance of up to 10% of the total issued shares at the time of adoption, with a maximum of 30% of the total issued shares available for issuance upon exercise of all outstanding options[100]. - The stock options granted to directors and employees are subject to a vesting schedule, with a maximum of 30% exercisable after one year, 60% after two years, and the remainder after three years[106]. - The share incentive plan was adopted on June 29, 2018, with a maximum limit of 10% of the total shares issued as of the adoption date, which is 1,124,269,277 shares[111]. Community Engagement - The company has been actively involved in community engagement through various activities, including the introduction of a "5G STEM Mobile Classroom" for local students[149].