Dividend Policy and Distribution - The company's 2023 annual dividend is RMB 0.2332 per share (including tax), totaling approximately RMB 21.339 billion, exceeding 70% of the net profit attributable to shareholders for the year[5] - The company plans to increase cash dividends to over 75% of the net profit attributable to shareholders from 2024 onwards for the next three years[5] - The company's total share capital at the end of 2023 is 91,507,138,699 shares, with a proposed final dividend of RMB 0.090 per share (including tax), totaling approximately RMB 8.236 billion[5] - The company's mid-year dividend for 2023 was RMB 0.1432 per share (including tax)[5] - Total dividends for 2023 were RMB 0.2332 per share, a 19.0% increase year-on-year, exceeding 70% of the company's net profit[17] - The dividend payout ratio for 2023 is 70.1% of the net profit attributable to shareholders[193] - The company's total cash dividend for 2023, including interim and final dividends, amounts to RMB 21.34 billion[193] - The final dividend for 2023 is expected to be paid on or before July 26, 2024, after approval at the 2023 annual general meeting[100] Financial Performance - Total operating revenue reached RMB 513.6 billion, a year-on-year increase of 6.7%, with service revenue at RMB 465 billion, up 6.9%[17] - Net profit increased by 10.3% to RMB 30.4 billion, with basic earnings per share at RMB 0.33[17] - Capital expenditure was RMB 98.8 billion, and free cash flow reached RMB 13 billion[17] - The company's operating income for 2023 was RMB 5,135.51 billion, a year-on-year increase of 6.9%[62] - The company's net profit attributable to shareholders was RMB 304.46 billion, a year-on-year increase of 10.3%[62] - The company's EBITDA was RMB 1,368.30 billion, a year-on-year increase of 5.0%, with an EBITDA margin of 29.4%[62] - Operating revenue in 2023 reached RMB 513.551 billion, a 6.7% increase compared to 2022[64][66] - Service revenue in 2023 was RMB 464.965 billion, up 6.9% year-over-year, with mobile communication service revenue at RMB 195.66 billion, a 2.4% increase[64][66][67] - Industrial digitalization service revenue grew significantly by 17.9% to RMB 138.89 billion in 2023[66][67] - Fixed-line and smart home service revenue increased by 3.8% to RMB 123.063 billion in 2023[66][68] - Other service revenue declined by 3.4% to RMB 7.352 billion in 2023[66][69] - Operating expenses in 2023 totaled RMB 476.423 billion, a 6.3% increase compared to 2022, accounting for 92.8% of operating revenue[70][71] - Depreciation and amortization expenses rose by 2.9% to RMB 99.702 billion in 2023[71][72] - Network operation and support costs increased by 8.7% to RMB 160.411 billion in 2023[71][73] - Labor costs grew by 9.5% to RMB 92.805 billion in 2023, reflecting increased investment in tech and innovative talent[71][74] - Net profit attributable to shareholders increased by 10.3% to RMB 30.446 billion in 2023[78] - Capital expenditure for 2023 was RMB 98.838 billion, an increase of 6.8% compared to 2022, driven by investments in 5G network construction, cloud-network integration, and AI computing capabilities[79] - Net cash generated from operating activities in 2023 was RMB 137.508 billion, a year-on-year increase of 0.8%[80][81] - Total assets increased by 3.5% to RMB 835.814 billion at the end of 2023, while total liabilities increased by 4.7% to RMB 388.647 billion, resulting in a debt-to-asset ratio of 46.5%[82] - Total debt decreased by RMB 1.342 billion to RMB 91.42 billion at the end of 2023, with 97.3% of the debt denominated in RMB[84] - The company's actual tax rate in 2023 was 22.4%, lower than the statutory rate of 25.0%, due to tax incentives such as tax-exempt investment income from China Tower and R&D expense deductions[79] - Cash and cash equivalents at the end of 2023 were RMB 81.046 billion, with RMB cash and equivalents accounting for 93.6%[81] - The company's operating capital shortage decreased by RMB 5.092 billion to RMB 135.573 billion at the end of 2023, with unused credit lines of RMB 205.452 billion[83] Business Operations and Market Development - The company's main business includes fixed, mobile, and satellite communication services, as well as internet access and information services[2] - The company's A-shares and H-shares are listed on the Shanghai Stock Exchange and the Hong Kong Stock Exchange, respectively[2] - The company achieved breakthroughs in technological innovation and completed the layout of strategic emerging businesses, with digital information infrastructure continuously upgraded and new quality productivity rapidly forming[16] - The company actively served and integrated into the new development pattern, seizing market development opportunities in the process of promoting Chinese-style modernization[16] - The company implemented the cloud reform and digital transformation strategy comprehensively, leveraging the advantages of cloud-network integration[16] - The company focused on building a service-oriented, technology-oriented, and security-oriented enterprise, with continuous improvements in governance capabilities and levels[16] - The company's market development momentum grew rapidly, and enterprise reforms were pushed forward in depth[16] - Mobile communication service revenue grew by 2.4% to RMB 195.7 billion, with mobile user ARPU at RMB 45.4, up 0.4%[21] - Fixed-line and smart home service revenue increased by 3.8% to RMB 123.1 billion, with smart home business revenue up 12.8% to RMB 19 billion[21] - Mobile user base grew by 16.59 million, reaching 408 million, maintaining industry leadership for six consecutive years[21] - Broadband user base increased by 9.26 million, reaching 190 million, with broadband ARPU at RMB 47.6, up 2.8%[21] - The company's industrial digital business revenue reached RMB 138.9 billion, a year-on-year increase of 17.9%, accounting for 29.9% of service revenue, an increase of 2.8 percentage points compared to the previous year[23] - The number of enterprise customers increased by 11.3% year-on-year, and the number of new 5G industry application projects increased by 106.3%, with a cumulative total of over 31,000 projects[23] - The number of IoT terminal users exceeded 520 million, and the user scale of applications such as Smart Kitchen and Tianyi Emergency exceeded 77 million[23] - Tianyi Cloud revenue reached RMB 97.2 billion, a year-on-year increase of 67.9%, and international business revenue exceeded RMB 13.7 billion[23] - The company's cloud computer user development volume increased by more than 2 times year-on-year, maintaining a nearly 40% share in the Chinese DaaS market[25] - The company's big data API was called 4.6 billion times annually, a year-on-year increase of 45%, and it has formed over 50 "Star Ocean Big Data" products[26] - The company has launched 12 industry-specific large models and has empowered over 600 projects in scenarios such as grassroots governance and smart cities[26] - The company's cloud-based anti-DDoS service (Cloud Dike) maintains the top market share in China and is listed in Gartner's global top service provider selection list[26] - The company has completed the acquisition of QuantumCTek Co., Ltd., enhancing technological and application innovation breakthroughs in the quantum field[28] - The company has launched the world's first commercial service supporting consumer-grade 5G terminal direct satellite two-way voice and SMS, providing emergency and guaranteed communication for industries such as maritime, industrial, and rescue[29] - The company has developed over 110 digital platforms, empowering digital transformation in government, enterprise, education, healthcare, and finance sectors. These platforms have been deployed in more than 20 provinces and 220 cities, providing comprehensive applications such as one-stop government services and urban management[30] - The company's intelligent computing capacity increased by 8.1 EFLOPS in 2023, reaching a total of 11.0 EFLOPS, a growth of 279.3%. Additionally, the general computing capacity increased by 1.0 EFLOPS, reaching 4.1 EFLOPS, a growth of 32.3%[31] - The company and China Unicom have saved over RMB 340 billion in cumulative investment and over RMB 39 billion in annual operating costs through network co-construction and sharing. They have built over 220,000 new 5G base stations, with a total of over 1.21 million 5G base stations in operation[32] - The company has built 250,000 800MHz base stations capable of 4G/5G integrated services by January 2024, significantly improving network coverage and user experience in rural areas[33] - The company's online development ratio for basic business users increased by 11.5 percentage points year-on-year, and the proportion of AI customer service increased by 12.6 percentage points. AI-powered energy-saving measures in data centers and base stations saved approximately 800 million kWh annually[33] - The company has expanded its global cloud network broadband industry association (WBBA) to 77 member units, covering 32 countries across five continents, and released the WBBA Global Cloud Network Broadband Industry Development Report and the Global Cloud Network Development Index[34] - The company has established 53 overseas branches, serving global demand for communication, internet, cloud computing, and digital transformation[35] - The international transmission network backbone scale is nearly 115Tbps, with over 50% directed towards the "Belt and Road" regions[35] - The company has over 6,000 racks in nearly 30 overseas data centers[35] - The company added 15 new global CDN nodes for its Tianyi Cloud service in 2023[35] - The company reduced greenhouse gas emissions by over 13 million tons through energy-saving measures, with a 19.6% year-on-year decrease in greenhouse gas emissions per unit of telecom business volume[37] - The company used over 1.1 billion kWh of green electricity in 2023, a nearly threefold increase year-on-year[37] - The company signed over 3,000 projects for green and low-carbon products and solutions, serving industries such as government, industrial manufacturing, and construction[37] - The company's digital services have achieved a penetration rate of over 60% in administrative villages, contributing to rural digitalization[38] - The company was recognized as "Asia's Most Admired Company" for the 13th consecutive year in the 2023 Institutional Investor survey[39] - The company aims to deepen its cloud-network transformation, focusing on AI development and meeting digital demands across industries with "network + cloud + AI + applications"[40] - Telecom business revenue reached RMB 1.68 trillion, a year-on-year increase of 6.2%[41] - 5G mobile phone users reached 805 million, accounting for nearly half of total mobile phone users[41] - Fixed broadband access users reached 636 million, with 163 million users having access speeds of 1000Mbps or higher[41] - Mobile internet user access traffic reached 301.5 billion GB, a year-on-year increase of 15.2%[42] - Monthly average data usage per user (DOU) reached 16.85GB, a year-on-year increase of 10.9%[42] - 5G application cases exceeded 94,000, covering 71 out of 97 major national economic categories[42] - Cellular IoT terminal users reached 2.332 billion, accounting for nearly 60% of total mobile network terminal connections[41] - The company is accelerating the deployment of AI infrastructure and transitioning to an "AI+" strategy[41] - The company is actively promoting the integration of cloud, network, and intelligence, and building a full optical base for computing power networks[41] - The company is focusing on compliance with new laws and regulations, including the revised Company Law and the Generative AI Service Management Interim Measures[43][44] - Mobile user base reached 408 million, with a net increase of 16.59 million, maintaining industry leadership for six consecutive years[46] - Mobile user ARPU increased to RMB 45.4, up 0.4% year-over-year[46] - Broadband user base reached 190 million, with a net increase of 9.26 million[46] - Broadband comprehensive ARPU increased to RMB 47.6, up 2.8% year-over-year[46] - Industrial digitalization revenue reached RMB 138.9 billion, up 17.9% year-over-year, accounting for 29.9% of service revenue[46] - Tianyi Cloud revenue reached RMB 97.2 billion, up 67.9% year-over-year[46] - Number of 5G base stations exceeded 1.21 million, achieving continuous coverage in towns and above and effective coverage in developed villages[48] - Greenhouse gas emissions reduced by over 13 million tons through co-construction and sharing and energy-saving measures[49] - Green electricity usage exceeded 1.1 billion kWh, up nearly 3 times year-over-year[49] - AIoT platform users exceeded 520 million, with a year-over-year growth of 45% in API calls[51] - The company's operating revenue in 2023 reached RMB 513.6 billion, a year-on-year increase of 6.7%, with service revenue at RMB 465 billion, up 6.9% year-on-year[56] - Mobile communication service revenue in 2023 was RMB 195.7 billion, a year-on-year increase of 2.4%, with mobile value-added and application revenue at RMB 25.8 billion, up 12.4% year-on-year[56] - The company's mobile user base increased by 16.59 million, reaching 408 million users, with mobile user ARPU at RMB 45.4, a year-on-year increase of 0.4%[57] - Fixed-line and smart home service revenue in 2023 was RMB 123.1 billion, a year-on-year increase of 3.8%, with smart home business revenue at RMB 19 billion, up 12.8% year-on-year[57] - Broadband user base increased by 9.26 million, reaching 190 million users, with broadband comprehensive ARPU at RMB 47.6, a year-on-year increase of 2.8%[57] - The company's quantum computing cloud platform "Tianyan" achieved ultra-quantum fusion, and it was the first globally to enable consumer mobile phones to directly connect to satellites for two-way voice calls and SMS services[53] - The company's data security posture awareness system improved accuracy to 98%, and it built a full-scale user anti-fraud risk model, achieving daily risk assessment for 470 million users[55] - The company's distributed cloud operating system TeleCloudOS 4.0 won the first prize of the 2023 China Communications Society Science and Technology Award[53] - The company's cloud computing and intelligent computing capabilities continued to upgrade, with the self-developed cloud operating system TeleCloudOS 4.0 forming a technological leadership[57] - The company's industry-leading quantum secure communication metropolitan area network was established, and it introduced communication/bank blacklist data, enabling minute-level shutdown of newly inserted cards on involved terminals[55] - Tianti Cloud revenue reached RMB 97.2 billion, a year-on-year increase of 67.9%[58] - Tianti Cloud maintained its leading position in the domestic public cloud IaaS and IaaS+PaaS markets, with its market share continuing to rise[58] - The number of new 5G industry application projects increased by 106.3% year-on-year, with a cumulative total of over 31,000 projects[60] - The company's digital business revenue reached RMB 1,389 billion, a year-on-year increase of 17.9%, accounting for 29.9% of service revenue[60] - The company's operating income for 2023 was RMB 5,135.51 billion, a year-on-year increase of 6.9%[62] - The company's net profit attributable to shareholders was RMB 304.46 billion, a year-on-year increase of 10.3%[62] - The company's EBITDA was RMB 1,368.30 billion, a year-on-year increase of 5.0%, with an EBITDA margin of 29.4%[62] - The company's cloud computer user base grew by more than 2 times year-on-year, maintaining a nearly 40% share in the Chinese DaaS market[58] - The company launched the "Xingchen MaaS Platform," which has empowered over 600 projects in various industries[58] - The company's AI intelligent customer service accounted for a 12.6% year-on-year increase in service volume[63] - Operating revenue in 2023 reached RMB 513.551 billion, a 6.7% increase compared to 2022[64][66] - Service revenue in 2023 was RMB 464.965 billion, up 6.9% year-over-year, with mobile communication service revenue at RMB 195.66 billion, a 2.4% increase[64][66][67] - Industrial digitalization service revenue grew significantly by 17.9% to RMB 138.89 billion in 2023[66][67] - Fixed-line and smart home service revenue increased by 3.8% to RMB 123.063 billion in 2023[66][68] - Other service revenue declined by 3.4% to RMB 7.352 billion in 2023[66][69] - Operating expenses in 2023 totaled RMB 476.423 billion, a 6.3% increase compared to 2022, accounting for 92.8% of operating revenue[70][71] - Depreciation and amortization expenses rose by

Financial Performance - The company's operating revenue for Q1 2024 was RMB 135.493 billion, an increase of 3.8% year-on-year, with service revenue reaching RMB 124.347 billion, up 5.0%[1][2][4] - Net profit attributable to shareholders was RMB 8.597 billion, reflecting a growth of 7.7% compared to the same period last year, with basic earnings per share at RMB 0.09[2][4] - The company reported an EBITDA of RMB 35.1 billion, a 3.6% increase year-on-year, with an EBITDA margin of 28.2%[4] - Operating revenue for the three months ended March 31, 2024, was RMB 135,493 million, an increase from RMB 130,588 million in the same period of 2023, representing a growth of 3.1%[10] - Net profit for the period was RMB 8,628 million, compared to RMB 7,972 million in the previous year, reflecting a year-over-year increase of 8.2%[10] User Growth - The total number of mobile users reached 411.65 million, with a net increase of 3.88 million users in Q1 2024[3][4] - The number of 5G package users increased by 10.06 million to 329.2 million, achieving a penetration rate of 79.9%[3][4] - Fixed broadband users totaled 192.22 million, with a net increase of 2.06 million users, while the smart home service revenue grew by 10.4%[5] Revenue Segments - The company's digital industry revenue reached RMB 38.679 billion, marking a 10.6% year-on-year growth[5] Operating Expenses - Operating expenses for Q1 2024 were RMB 124.941 billion, an increase of 3.6% year-on-year, with network operation costs rising by 6.6%[5] - The company’s gross operating expenses for the quarter were RMB 124,941 million, compared to RMB 120,586 million in the same period last year, an increase of 3.7%[10] Assets and Liabilities - Total assets as of March 31, 2024, amounted to RMB 848,806 million, up from RMB 835,814 million at the end of 2023, indicating a growth of 1.2%[9] - Current liabilities totaled RMB 309,402 million, slightly increased from RMB 303,436 million in the previous quarter, showing a rise of 2.3%[8] - The company reported a total equity of RMB 455,646 million, an increase from RMB 447,167 million, representing a growth of 1.1%[9] Cash Flow - Cash and cash equivalents decreased to RMB 71,553 million from RMB 81,046 million, a decline of 11.5%[7] - The net cash generated from operating activities for the three months ended March 31, 2024, was RMB 20,317 million, a decrease of 28.2% from RMB 28,215 million in the same period of 2023[13] - The net cash used in investing activities was RMB (20,293) million, compared to RMB (15,943) million in the same period of 2023, indicating an increase in investment outflows[13] - The net cash used in financing activities was RMB (9,522) million, slightly improved from RMB (9,977) million in the same period of 2023[13] - The cash and cash equivalents as of March 31, 2024, amounted to RMB 71,553 million, down from RMB 74,642 million as of March 31, 2023[13] Depreciation and Interest - Depreciation and amortization for the three months ended March 31, 2024, was RMB 24,548 million, an increase from RMB 23,872 million in the same period of 2023[14] - The company reported a net interest expense of RMB 591 million for the three months ended March 31, 2024, down from RMB 696 million in the same period of 2023[14] Losses and Future Outlook - The company experienced a net loss of RMB 1,321 million from the disposal of long-term assets for the three months ended March 31, 2024, compared to RMB 543 million in the same period of 2023[14] - The company anticipates future growth strategies and operational plans, although these forward-looking statements are subject to risks and uncertainties[16] - The board of directors emphasizes caution for investors when relying on the financial and business data provided, as they are unaudited figures[15]

Investment Rating - The investment rating for China Telecom is "Buy" with a target price of 5.50 HKD [3]. Core Insights - China Telecom reported stable growth in 2023, with total revenue reaching 513.6 billion RMB, a year-on-year increase of 7%. The net profit attributable to shareholders was 30.4 billion RMB, up 10% year-on-year. The company also announced a dividend of 0.2332 RMB per share, achieving a payout ratio of 70%, with plans to increase this to 75% over the next three years [1][2]. Summary by Sections Financial Performance - In 2023, the telecom service revenue was 465 billion RMB, marking a 7% increase and maintaining growth for 11 consecutive years. Mobile communication service revenue reached 195.7 billion RMB, growing by 2%. The mobile user base expanded to 408 million, with a net addition of 16.59 million users, leading the industry for six years [1]. - The average revenue per user (ARPU) for 2023 was 45.4 RMB, a slight increase of 0.4%. Fixed-line and smart home revenue was 123.1 billion RMB, up 4%, with broadband users reaching 190 million and an ARPU of 47.6 RMB, increasing by 3% [1][2]. Digital Transformation - The company's cloud revenue from Tianyi Cloud reached 97.2 billion RMB, a significant increase of 68% year-on-year, with international business revenue exceeding 13.7 billion RMB. The company is enhancing its cloud services with integrated computing platforms, maintaining its leading position in public cloud infrastructure [1][2]. Capital Expenditure and Network Expansion - In 2023, China Telecom's total capital expenditure was 98.8 billion RMB, with 34.8 billion RMB allocated to mobile networks and 35.5 billion RMB to industrial digitalization. The company added 220,000 5G base stations, achieving continuous coverage in towns and effective coverage in developed administrative villages [2]. - The company anticipates a capital expenditure of 96 billion RMB in 2024, a 3% decrease from the previous year, with a focus on mobile network and digitalization investments [2]. Dividend Policy - The company achieved a dividend payout ratio of 70% in 2023, fulfilling its profit distribution commitment made during its A-share issuance. Plans are in place to increase the payout ratio to over 75% within three years, enhancing shareholder returns [2][3].

Investment Rating - The report maintains a "Buy" rating for China Telecom with a target price adjusted to HKD 5.2, reflecting a 27% upside potential from the current stock price of HKD 4.1 [2][3]. Core Views - China Telecom has entered a high-quality development phase focused on improving efficiency and returns, with service revenue expected to maintain good growth over the next three years. The reduction in capital expenditure is anticipated to enhance operating cash flow [2][3]. - The company emphasizes precise cost management and structural optimization, projecting profit growth to outpace revenue growth [2][3]. Summary by Sections Financial Performance - In 2023, China Telecom achieved revenue of CNY 513.6 billion (YoY +6.7%), with service revenue at CNY 465 billion (YoY +6.9%). EBITDA reached CNY 136.8 billion (YoY +5.0%), and net profit was CNY 30.4 billion (YoY +10.3%) [1][3]. - The company plans to increase its dividend payout ratio to over 75% over the next three years, with a dividend of CNY 0.23 per share in 2023 (YoY +19%) [1][3]. Business Segments - Mobile communication service revenue was CNY 195.7 billion (YoY +2.4%), with a mobile ARPU of CNY 45.4 (YoY +0.4%). The number of mobile users reached 408 million, with a net increase of 16.59 million users [1][3]. - The digital industry segment saw revenue of CNY 138.9 billion (YoY +17.9%), with Tianyi Cloud revenue at CNY 97.2 billion (YoY +67.9%), indicating rapid growth and a focus on upgrading to intelligent cloud services [1][3]. Future Outlook - The report anticipates that the capital expenditure for 2024 will be CNY 96 billion, accounting for less than 20% of service revenue, a decrease of 2.9% from the previous year [1][3]. - The company is expected to focus more on the quality of revenue growth in its cloud services, transitioning into a phase of high-quality development [1][2].

Financial Performance - The company's operating revenue for 2023 reached RMB 513.6 billion, a year-on-year increase of 6.7%, with service revenue at RMB 465 billion, up 6.9%, marking 11 consecutive years of growth[3] - EBITDA for 2023 was RMB 136.8 billion, reflecting a 5.0% year-on-year growth, while net profit amounted to RMB 30.4 billion, a 10.3% increase, resulting in basic earnings per share of RMB 0.33[3] - The board proposed a final dividend of RMB 0.090 per share for 2023, leading to a total dividend of RMB 0.2332 per share for the year, a 19.0% increase compared to the previous year, exceeding 70% of the annual profit attributable to shareholders[4] - In 2023, the company's operating revenue reached RMB 513.55 billion, an increase of 6.7% compared to 2022[28] - Service revenue amounted to RMB 464.97 billion, growing by 6.9% year-over-year[30] - The company's net profit attributable to shareholders was RMB 30.45 billion, reflecting a 10.3% increase from the previous year[28] - EBITDA for 2023 was RMB 136.83 billion, with an EBITDA margin of 29.4%[28] - Operating expenses totaled RMB 476.42 billion, increasing by 6.3% and accounting for 92.8% of operating revenue[35] Revenue Breakdown - Mobile communication service revenue reached RMB 195.7 billion, growing 2.4% year-on-year, with mobile value-added and application revenue at RMB 25.8 billion, up 12.4%[3] - Fixed-line and smart home service revenue reached RMB 123.1 billion, a year-on-year increase of 3.8%, with smart home business revenue at RMB 19 billion, up 12.8%[8] - The company's revenue from data and industry services reached RMB 138.9 billion, a year-on-year increase of 17.9%, accounting for 29.9% of service revenue, up 2.8 percentage points from the previous year[9] - Digital industrial services revenue increased significantly to RMB 138,890 million from RMB 117,756 million, a growth of 17.91%[60] Investment and R&D - Research and development expenses increased from RMB 4.7 billion in 2020 to RMB 13.1 billion in 2023, representing a growth of 175.6% over three years[6] - The number of technology-leading talents reached 138 in 2023, a significant increase of 392.9% over three years, while the proportion of R&D personnel rose from 4.2% in 2020 to 11.8%[6] - The company filed over 5,000 invention patent applications in 2023, with self-developed IT systems and business platforms accounting for 45.0% of total systems, an increase of 6.0 percentage points year-on-year[6] Market and Shareholder Value - The market capitalization at the end of 2023 reached 3.2 times that of the end of 2020, demonstrating significant value creation for shareholders[4] - The company aims to increase cash distributions to over 75% of the annual profit attributable to shareholders within three years starting from 2024, enhancing shareholder value[4] User Growth and Service Expansion - The number of mobile users increased by 16.59 million, reaching a total of 408 million users, with an ARPU of RMB 45.4, a 0.4% year-on-year growth[7] - The number of 5G industry application projects increased by 106.3% year-on-year, totaling over 31,000 projects[9] Technological Advancements - The company launched a series of AI models covering four capabilities, enabling over 600 projects in various sectors such as governance and smart cities[11] - The company has achieved a significant enhancement in quantum computing capabilities with the launch of the "Tianyan" quantum computing cloud platform, integrating 13 superposition qubits, which greatly improves processing speed[13] - The company has introduced the world's first operational product "Mobile Direct Satellite" that supports consumer-grade 5G terminal direct connection to satellites for two-way voice and SMS services, enhancing emergency communication capabilities across various industries[14] Environmental and Social Responsibility - The scale of green electricity usage exceeded 1.1 billion kWh, a year-on-year increase of nearly 300%[23] - Greenhouse gas emissions were reduced by over 13 million tons, with a year-on-year decrease of 19.6% in emissions per unit of telecom business volume[22] - The company has signed over 3,000 projects to support ecological protection, pollution prevention, and energy conservation[23] Corporate Governance - The company has maintained compliance with the corporate governance code and has not purchased, sold, or redeemed any of its listed securities during the reporting period[73][75] - The external auditor confirmed that the consolidated performance data for the year ended December 31, 2023, aligns with the audited consolidated financial statements[73] - The company emphasizes its commitment to high levels of corporate governance and effective internal controls to protect the long-term interests of shareholders[74]

Financial Performance - For the first three quarters of 2023, the company's operating revenue reached RMB 384.25 billion, an increase of 6.4% year-on-year, with service revenue also growing by 6.4% to RMB 349.74 billion[1][2][4]. - The company's EBITDA for the same period was RMB 105.65 billion, reflecting a growth of 5.2% compared to the previous year, resulting in an EBITDA margin of 30.2%[1][4][5]. - Net profit attributable to shareholders was RMB 27.10 billion, marking a 10.4% increase year-on-year, with basic earnings per share at RMB 0.30[1][2][4]. - The company reported a net profit of RMB 27,143 million for the nine months ended September 30, 2023, compared to RMB 24,637 million for the same period in 2022, marking an increase of about 10.2%[10]. - Basic and diluted earnings per share for the nine months ended September 30, 2023, were both RMB 0.30, up from RMB 0.27 in the same period of 2022, representing an increase of approximately 11.1%[10]. - The pre-tax profit for the nine months ended September 30, 2023, was RMB 35,014 million, up 10% from RMB 31,831 million in the same period of 2022[12]. User Growth - The total number of mobile users reached approximately 406.1 million, with a net increase of 14.63 million users during the period[3][4]. - The number of 5G package users increased by 39.65 million, totaling approximately 308.1 million users, achieving a penetration rate of 75.8%[3][4]. - Fixed broadband users reached 189.26 million, with a net increase of 83.6 million users, while the average revenue per user (ARPU) for broadband services was RMB 47.8[3][6]. Digitalization and Strategy - The company's digitalization business revenue grew by 16.5% year-on-year, reaching RMB 99.74 billion, driven by cloud, AI, and platform integration[6]. - The company plans to continue implementing its cloud transformation strategy and enhance its core competitiveness in the digital economy[6]. - The company expects to continue its strategic investments in new technologies and market expansion, although specific financial guidance was not provided[13]. - The company emphasizes the importance of cautious investment decisions due to potential risks and uncertainties affecting future performance[13]. Financial Position - Net cash and cash equivalents as of September 30, 2023, amounted to RMB 82,445 million, up from RMB 72,465 million at the end of 2022, indicating a growth of about 13.7%[8]. - Total assets as of September 30, 2023, were RMB 835,598 million, compared to RMB 807,698 million at the end of 2022, reflecting an increase of approximately 3.5%[8]. - Total liabilities as of September 30, 2023, were RMB 391,932 million, an increase from RMB 371,271 million at the end of 2022, indicating a growth of about 5.5%[8]. - The company’s total non-current assets decreased to RMB 652,681 million as of September 30, 2023, from RMB 666,626 million at the end of 2022, a decline of approximately 2.1%[7]. - The company’s total current liabilities increased to RMB 311,267 million as of September 30, 2023, compared to RMB 281,737 million at the end of 2022, reflecting an increase of about 10.5%[8]. - The company’s total equity as of September 30, 2023, was RMB 443,666 million, compared to RMB 436,427 million at the end of 2022, indicating an increase of about 1.6%[8]. Cash Flow and Investments - For the nine months ended September 30, 2023, the net cash generated from operating activities was RMB 112,330 million, a decrease of 3% from RMB 116,018 million in the same period of 2022[11]. - The company’s cash flow from operating activities for the nine months ended September 30, 2023, was RMB 114,597 million, compared to RMB 118,116 million in the same period of 2022[12]. - The net cash used in investing activities was RMB 61,612 million, a decrease of 9% from RMB 68,057 million in the same period of 2022[11]. - The net cash used in financing activities was RMB 40,791 million, a slight decrease from RMB 42,314 million in the same period of 2022[11]. - The company reported an increase in accounts receivable by RMB 32,166 million for the nine months ended September 30, 2023, compared to an increase of RMB 19,654 million in the same period of 2022[12]. - The company’s capital expenditures for the nine months ended September 30, 2023, were RMB 60,564 million, slightly up from RMB 60,251 million in the same period of 2022[11].

Financial Performance - The company reported a profit attributable to shareholders of RMB 20.15 billion for the six months ended June 30, 2023, with a proposed dividend distribution of RMB 13.104 billion, translating to a dividend of RMB 0.1432 per share (before tax) based on a total share capital of 91,507,138,699 shares[6]. - The company plans to allocate 65% of its profit to shareholders, reflecting a commitment to shareholder returns while considering cash flow and profitability[6]. - The company's operating revenue for the first half of 2023 reached RMB 236 billion, representing a year-on-year growth of 6.6%[20]. - The company's revenue for the first half of the year reached RMB 260.7 billion, a year-on-year increase of 7.6%[32]. - Net profit attributable to shareholders was RMB 20.2 billion, reflecting a year-on-year growth of 10.2%, with basic earnings per share at RMB 0.22[32]. - The total comprehensive income attributable to shareholders is RMB 20,421 million, reflecting a strong performance in the first half of 2023[130]. - The basic and diluted earnings per share are both RMB 0.22, consistent with the previous reporting period[130]. - The company maintained a stable dividend policy, with dividends paid amounting to RMB 15,556 million during the period[131]. Revenue Breakdown - The telecommunications business revenue reached RMB 868.8 billion, representing a year-on-year growth of 6.2%[18]. - Emerging business revenue, including IPTV, internet data centers, big data, cloud computing, and IoT, totaled RMB 188 billion, with a year-on-year increase of 19.2%[18]. - Application revenue amounted to RMB 15.4 billion, with a year-on-year increase of 19.4%[20]. - Mobile communication service revenue grew to RMB 101.6 billion, up 2.7% year-on-year, while mobile user ARPU reached RMB 46.2, a 0.4% increase[20]. - The digitalization business generated RMB 68.8 billion, marking a significant year-on-year increase of 16.7%[20]. Capital Expenditure and Investments - Capital expenditure for the first half was RMB 41.6 billion, with free cash flow amounting to RMB 17.6 billion[32]. - The company has committed approximately RMB 378.88 billion of the raised funds to projects related to 5G infrastructure, cloud integration, and technological innovation[70]. - The total amount raised from the A-share issuance was approximately RMB 479.04 billion, netting approximately RMB 475.16 billion after deducting issuance costs[70]. - The company has invested a total of approximately RMB 439.25 billion from the raised funds, with an unused balance of approximately RMB 96.28 billion[70]. Risk Management and Compliance - The company has outlined its development strategies and identified various economic and policy risks that may impact future operations[7]. - The report emphasizes the importance of risk management in the context of international operations and market expansion[7]. - The company aims to strengthen its overseas compliance management and risk assessment to mitigate risks associated with international business expansion[62]. - The company has conducted ongoing assessments of network security vulnerabilities to ensure reliable operations and data safety[61]. Technological Advancements - The company is focused on enhancing its technological capabilities, including advancements in 5G and AI technologies, to drive future growth[9]. - The company is implementing a cloud transformation strategy, focusing on customer-centricity and technological innovation to enhance service quality and security[18]. - The company aims to deepen the integration of digital technology and the real economy through a combination of network, cloud computing, AI, and applications[18]. - The company upgraded its AI algorithm platform, reaching 5,500 self-developed scene algorithms and launched a general visual model with 10 billion parameters[38]. Sustainability and Corporate Social Responsibility - The company emphasizes green development and is advancing low-carbon operations, aligning with national "dual carbon" goals[91]. - The company has reduced carbon emissions by over 5 million tons in the first half of 2023, with a carbon emission intensity decrease of over 10%[94]. - The company has implemented a "1248" dual carbon action plan, focusing on eight major green actions to promote green low-carbon transformation[92]. - The company has created nearly 60,000 "Love Wing Stations" providing various public services, serving a total of 15 million people[46]. Governance and Shareholder Engagement - The board of directors has approved the profit distribution plan during the second meeting of the eighth board session held on August 8, 2023[6]. - The company held two shareholder meetings during the reporting period, with all resolutions passed[82]. - The company published the resolutions on designated websites, ensuring transparency for shareholders[82]. - The company has not granted any share options to its directors, supervisors, or their immediate family members during the six months ending June 30, 2023[65].

Financial Performance - The company's operating revenue for the first half of 2023 was RMB 260.7 billion, a year-on-year increase of 7.6%, with service revenue reaching RMB 236.0 billion, up 6.6%[1] - EBITDA amounted to RMB 73.3 billion, reflecting a 5.0% year-on-year growth, while net profit was RMB 20.2 billion, an increase of 10.2%, resulting in basic earnings per share of RMB 0.22[3] - The company reported operating revenue of RMB 260,664 million for the six months ended June 30, 2023, an increase of 7.6% compared to RMB 242,319 million in the same period of 2022[22] - Operating profit for the same period was RMB 25,508 million, reflecting a growth of 10.4% from RMB 23,113 million year-on-year[23] - The company achieved a net profit of RMB 20,174 million, which is a 9.9% increase compared to RMB 18,353 million in the previous year[23] - The company's revenue for the six months ended June 30, 2023, was RMB 20,442 million, an increase from RMB 18,550 million in the same period of 2022, representing a growth of 10.2%[24] - Shareholders' profit attributable to the company was RMB 20,153 million for the six months ended June 30, 2023, compared to RMB 18,291 million in 2022, reflecting an increase of 10.2%[25] - The basic and diluted earnings per share for the period were both RMB 0.22, up from RMB 0.20 in the previous year[25] - The company reported a total comprehensive income of RMB 20,442 million for the period, compared to RMB 18,550 million in the previous year, marking an increase of 10.2%[25] Revenue Breakdown - Mobile communication service revenue grew to RMB 101.6 billion, a 2.7% increase year-on-year, with mobile value-added and application revenue reaching RMB 15.4 billion, up 19.4%, and 5G package user penetration rate at 73.4%[7] - Fixed-line and smart home service revenue reached RMB 62.0 billion, a 3.6% year-on-year increase, with smart home business revenue at RMB 9.3 billion, up 15.7%, and gigabit broadband penetration rate at 20.3%[7] - The company's industrial digitalization business maintained rapid growth, with revenue of RMB 68.8 billion, a year-on-year increase of 16.7%, and Tianyi Cloud revenue reaching RMB 45.9 billion, up 63.4%[7] - Service revenue reached RMB 235,977 million, up from RMB 221,384 million year-on-year, indicating a growth of about 6.6%[31] - Mobile communication service revenue was RMB 101,607 million, compared to RMB 98,956 million in the previous year, reflecting an increase of approximately 1.7%[31] Dividend and Shareholder Returns - The board decided to continue paying an interim dividend for 2023, distributing 65% of the profit attributable to shareholders, equating to RMB 0.1432 per share[3] - The company aims to increase the cash distribution to shareholders to over 70% of the profit attributable to shareholders for the 2023 fiscal year[4] - The interim dividend for the six months ended June 30, 2023, is set at RMB 0.1432 per share, totaling approximately RMB 13.104 billion[38] - The company plans to distribute an interim dividend of RMB 131.04 billion, which is 65% of the profit attributable to shareholders of RMB 201.53 billion for the first half of 2023[48] - The dividend payment is expected to be made on or before September 28, 2023, to shareholders listed on the H-share register as of August 30, 2023[48] Strategic Focus and Growth Initiatives - The company is focusing on digital transformation and cloud integration strategies, enhancing its digital infrastructure and service capabilities[5] - The company is actively expanding its strategic emerging industries, integrating cloud, AI, and security to enhance digital product and service capabilities[7] - The company has initiated the establishment of a Quantum Information Technology Group to promote the application of cutting-edge quantum technologies[15] - The company aims to enhance its core competitiveness and accelerate the construction of a world-class enterprise through comprehensive reforms and innovation[20] - The company plans to further optimize its strategic layout in emerging industries, focusing on technology innovation and infrastructure upgrades[20] Research and Development - R&D expenses increased by 27.2% year-on-year, with the number of R&D personnel growing by 21.4%[8] - The AI algorithm platform has developed 5,500 self-researched scene algorithms, enhancing AI capabilities across various industries[10] Network and Infrastructure - The company has established over 1.15 million 5G base stations and over 2 million 4G base stations, enhancing network coverage and capacity[15] - The company constructed over 534,000 racks in its IDC, with more than 70% of new racks deployed in hotspot areas[14] - The company’s intelligent computing capacity increased by 62% to 4.7 EFLOPS, while general computing capacity grew by 19% to 3.7 EFLOPS[13] - The number of IoT connections exceeded 470 million, showcasing significant growth in the IoT sector[12] Environmental and Corporate Governance - The company has reduced greenhouse gas emissions by over 5 million tons in the first half of 2023, with a year-on-year reduction in emission intensity of over 10%[18] - The company emphasizes the importance of corporate governance and has maintained compliance with the corporate governance code during the reporting period[46] - The company has been recognized for its corporate governance, winning multiple awards including "Best Corporate Social Responsibility" for four consecutive years[19] Financial Position and Liquidity - Total assets as of June 30, 2023, amounted to RMB 840,386 million, compared to RMB 807,698 million as of December 31, 2022, indicating an increase of 4.0%[26] - The company's cash and cash equivalents were RMB 83,698 million as of June 30, 2023, compared to RMB 72,465 million at the end of 2022, showing a growth of 15.5%[26] - Total liabilities increased to RMB 390,459 million as of June 30, 2023, from RMB 371,271 million at the end of 2022, representing a rise of 5.1%[27] - The net cash flow from operating activities remains positive, contributing to the company's liquidity position[28] - The company has unused credit facilities amounting to RMB 237 billion as of June 30, 2023, which supports its financial stability[28] Accounts Receivable and Payable - The net accounts receivable as of June 30, 2023, amounts to RMB 46.732 billion, an increase from RMB 24.312 billion as of December 31, 2022[39] - The aging analysis of accounts receivable shows that RMB 9.34 billion is due within one month, compared to RMB 6.405 billion in the previous year[40] - The total accounts payable as of June 30, 2023, is RMB 150.431 billion, up from RMB 127.260 billion as of December 31, 2022[42] - The provision for credit losses on accounts receivable decreased to RMB 8.685 billion as of June 30, 2023, from RMB 30.429 billion as of December 31, 2022[39] Forward-Looking Statements - The company emphasizes that forward-looking statements regarding development strategies and future operating plans are subject to known and unknown risks and uncertainties, which may lead to significant differences from actual performance[55] - The board of directors includes key executives such as the Chairman and CEO, and the President and COO, indicating a strong leadership team[55]

Financial Performance and Revenue - Total operating revenue for 2022 reached RMB 481.4 billion, a year-on-year increase of 9.5%, with service revenue at RMB 434.9 billion, up 8.0% year-on-year[19] - EBITDA for 2022 was RMB 130.4 billion, a year-on-year increase of 5.2%, and net profit was RMB 27.6 billion, up 6.3% year-on-year[19] - Mobile service revenue in 2022 was RMB 191 billion, a year-on-year increase of 3.7%, with 5G package user penetration reaching 68.5%[23] - Fixed-line and smart home service revenue in 2022 was RMB 118.5 billion, a year-on-year increase of 4.4%, with gigabit broadband penetration reaching 16.8%[23] - Industrial digitalization revenue in 2022 reached RMB 117.8 billion, a year-on-year increase of 19.7%, with Tianyi Cloud revenue at RMB 57.9 billion, up 107.5% year-on-year[25] - Cybersecurity service revenue in 2022 was RMB 4.7 billion, a year-on-year increase of 23.5%[25] - Operating revenue in 2022 reached RMB 481.448 billion, a 9.5% increase compared to 2021[59][60] - Service revenue in 2022 was RMB 434.928 billion, up 8.0% year-over-year, with a 19.0% growth in industrial digitalization service revenue to RMB 117.756 billion[59][61][64] - Mobile communication service revenue grew 3.7% to RMB 191.026 billion, accounting for 39.7% of total operating revenue[61][62] - Fixed-line and smart home service revenue increased 4.4% to RMB 118.534 billion, representing 24.6% of total operating revenue[61][63] - Revenue from selling goods and other income surged 26.7% to RMB 46.520 billion, driven by strong sales of 5G mobile devices[61][65] - Other service revenue grew 22.7% to RMB 7.612 billion, primarily due to increased rental income from properties[61][67] Dividend and Shareholder Returns - The company proposed a final dividend of RMB 0.076 per share for 2022, totaling RMB 6.955 billion, with a full-year dividend of RMB 0.196 per share, totaling RMB 17.935 billion, representing 65% of the net profit attributable to shareholders[3] - China Telecom plans to increase cash dividends to over 70% of net profit attributable to shareholders within three years after its A-share listing[3] - The company's total dividend for 2022 was RMB 0.196 per share, representing 65% of the net profit attributable to shareholders[19] - The company plans to gradually increase the cash dividend payout ratio to over 70% of net profit attributable to shareholders within three years of its A-share listing[19] - The company's dividend policy aims to balance cash flow and shareholder returns, with adjustments to per-share dividends if share capital changes before the record date[3] - The company prioritizes cash dividends for profit distribution, aiming to balance shareholder returns with sustainable development[96] - The company proposed a final dividend of RMB 0.076 per share for 2022, totaling RMB 6.955 billion, with a full-year dividend of RMB 0.196 per share, totaling RMB 17.935 billion, representing 65% of the annual profit[97] - The total dividend for 2022, including the interim dividend of RMB 0.120 per share (tax inclusive), amounts to RMB 0.196 per share (tax inclusive), totaling RMB 17.935 billion, representing 65% of the company's attributable profit for the year[191] - The cash dividend policy stipulates that the company will distribute no less than 30% of the average distributable profit over any three consecutive years, provided there are no major investment plans or cash outflows[190] User and Market Growth - China Telecom had approximately 391 million mobile users and 181 million fixed broadband users by the end of 2022[1] - Mobile users reached 391 million, with a net increase of 18.75 million[43] - 5G package users reached 268 million, with a penetration rate of 68.5%, an increase of 18.1 percentage points year-on-year[43] - Mobile user ARPU reached RMB 45.2, a year-on-year increase of 0.4%[43] - Broadband users reached 181 million, with a net increase of 11.19 million[43] - Gigabit user penetration rate reached 16.8%, an increase of 9.1 percentage points year-on-year[43] - Broadband comprehensive ARPU reached RMB 46.3, a year-on-year increase of 0.9%[43] - The company's mobile communication service revenue in 2022 was RMB 191 billion, a year-on-year increase of 3.7%, with mobile users reaching 391 million, a net increase of 18.75 million[52] - The company's 5G package users reached 268 million, with a penetration rate of 68.5%, an increase of 18.1 percentage points year-on-year[52] - The company's mobile user ARPU reached RMB 45.2, a year-on-year increase of 0.4%[52] - Fixed network and smart home service revenue reached RMB 118.5 billion, a year-on-year increase of 4.4%, with broadband users reaching 181 million, a net increase of 11.19 million, and gigabit broadband user penetration rate reaching 16.8%, up 9.1 percentage points year-on-year[54] Cloud and Digital Transformation - The company implemented a comprehensive cloud and digital transformation strategy, achieving high-quality development and doubling the revenue of Tianyi Cloud[16] - The company focused on technological innovation, making substantial progress in capability deployment and advancing cloud-network integration to strengthen the digital infrastructure foundation[16] - The company's cloud computing capabilities have significantly improved, with the launch of the "Xirang" platform, which is recognized as one of the top 10 super projects of central enterprises in 2022, and the establishment of the largest quantum metropolitan area network in China, the "Hefei Quantum Metropolitan Area Network"[28] - The company has expanded its cloud computing infrastructure, with over 240 cities covered by the "One City, One Pool" strategy and more than 800 edge computing nodes, adding 1.7 EFLOPS of cloud computing power in 2022, bringing the total cloud computing power to 3.8 EFLOPS[30] - The company has built a nationwide AI computing power network, integrating over 5,000 algorithms and more than 100 scenario-based solutions, and has established more than 700 data centers and over 3,000 edge data centers, with a total of 513,000 IDC racks and a utilization rate exceeding 70%[32] - The company's cloud computing power scale reached 3.8 EFLOPS in 2022, with coverage in over 240 cities[47] - The company has deployed over 800 edge computing nodes and covered over 240 cities with its "one city, one pool" strategy[57] - The company has launched over 5,000 AI algorithms and developed a large-scale urban governance model with over 1 billion parameters[55] - The company has optimized its "2+4+31+X+O" computing power layout, focusing on key regions such as Beijing-Tianjin-Hebei, Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area[57] Network and Infrastructure Development - The company developed nearly 15,000 5G 2B commercial projects in 2022, with over 8,000 new projects added during the year[25] - IoT user scale exceeded 400 million, and Tianyi Video Network users surpassed 46 million[26] - The company has built the largest gigabit optical fiber network, with over 6.3 million 10G PON ports, covering over 250 million household users[58] - The company has jointly built and shared over 1 million 5G base stations and over 1.1 million 4G base stations with China Unicom[58] - The company saved over RMB 270 billion in network construction investment through 4G/5G co-construction and sharing with China Unicom, with over 1 million 5G base stations and 1.1 million 4G base stations co-constructed[48] - The company's 10G PON port number exceeded 6.3 million, and the "Cloud Dike" platform covered over 150 cities[47] - The company has built a "Cloud Dike" platform covering over 150 cities, enhancing network security capabilities[58] - The company has achieved significant energy savings, reducing electricity consumption by over 600 million kWh annually through the application of AI technology in mobile base stations and old equipment rooms[34] - The company has saved over RMB 270 billion in network construction costs and reduced annual operating costs by more than RMB 30 billion through the co-construction and sharing of 4G/5G base stations with China Unicom, with over 1 million 5G base stations and 1.1 million 4G base stations shared[34] - The company reduced greenhouse gas emissions by over 13 million tons in 2022 through co-construction and sharing as well as energy-saving measures, with greenhouse gas emissions per unit of information traffic decreasing by 20.6% year-on-year[37] - The company built the first "zero-carbon data center" in Qinghai and actively promoted green cloud network construction and operation[37] Innovation and R&D - The company's domestic invention patent applications and PCT patent applications have increased by 1.4 times and 2 times, respectively, compared to the same period last year[28] - The company's domestic invention patent and PCT patent applications were 1.4 times and 2 times the same period last year, respectively[49] - The company has established a distributed big data lake and developed a cloud-edge collaborative big data computing model, accelerating the digital transformation of internal products, sales, services, operations, and management[35] - The company has formed a 5G industry innovation alliance with over 400 member units, exploring 5G innovative applications and building a 5G industry ecosystem[36] - The company plans to increase investment in technological innovation and R&D, focusing on 5G commercialization and industrial chain development to enhance market competitiveness[92] - The company will strengthen data security and personal information protection, improving core network technology and supply chain security management[93] Corporate Governance and Leadership - The company's board of directors and senior management underwent several changes in 2022, including the appointment of new executive directors and independent non-executive directors[101][102][103] - The company's supervisory board also saw changes in 2022, with new supervisors being appointed and a new chairman of the supervisory board being elected[104][105] - The company's audit committee, remuneration committee, and nomination committee underwent personnel changes effective from January 6, 2023[103] - The board of directors consists of 9 members, including 4 executive directors, 1 non-executive director, and 4 independent non-executive directors, ensuring diversity and independent judgment[165] - The company implemented a board diversity policy in August 2013, focusing on gender, age, educational background, professional experience, and skills to enhance overall performance and sustainable development[165] - The board currently includes one female director, and the company is committed to maintaining gender diversity in its board composition[165] - The board's diversity in expertise, including telecommunications, accounting, finance, law, and management, promotes balanced decision-making and governance[165] - The nomination committee monitors the implementation of the board diversity policy and reviews it periodically to propose revisions[165] - The company strictly adheres to corporate governance codes to ensure the standardization of board and committee workflows, guaranteeing the accuracy and fairness of financial statements for the fiscal period ending December 31, 2022[166] - The board is responsible for major operational decisions, financial planning, and the appointment of senior management, while management oversees daily operations and implements board resolutions[166] - The company provides ongoing training and professional development for directors, including monthly briefings on key financial and operational data[167] - Directors participated in various training activities, including seminars, forums, and reading/writing on topics such as economics, telecommunications, and corporate governance[168] - The company has adopted the "Standard Code of Conduct for Securities Transactions by Directors of Listed Issuers" to regulate securities transactions by directors and supervisors, with full compliance confirmed for 2022[169] - The board held multiple meetings in 2022, including discussions on financial reports, profit distribution, and the appointment of senior executives[170][171] - The company held a total of 11 board meetings in 2022, including 4 on-site meetings and 7 via teleconference[172] - The Chairman and independent non-executive directors conducted one independent communication session to ensure their opinions were fully expressed[172] - The Audit Committee held 7 meetings during the reporting period and had 2 independent communications with external auditors[175][177] - The company reviewed and approved the 2022 Q3 financial report and the use of idle raised funds for cash management in the 21st board meeting[172] - The company reviewed and approved the 2022 Q1 financial report in the April 20th board meeting[176] - The company reviewed and approved the 2022 semi-annual report and the progress of social responsibility work in the August 15th board meeting[178] - The company reviewed and approved the 2022 Q3 financial report in the October 20th board meeting[178] - The Audit Committee proposed multiple practical and professional improvement suggestions to promote the continuous improvement of the company's management[175] - The company reviewed and approved the 2021 annual financial report and the 2022 annual external auditor appointment in the March 16th board meeting[176] Risk Management and Internal Control - The company highlighted risks including economic and policy environment adaptation, operational risks, network and information security risks, and international business risks[4] - The company's risk management and internal control systems are designed to manage risks related to achieving strategic objectives, with a focus on operational efficiency, governance, and compliance[195] - The company has established a comprehensive internal control system, including a manual, implementation rules, and a list of authorities, which is continuously revised to adapt to changes in the internal control environment and business development needs[195] - The company conducted a comprehensive internal control evaluation in 2022, covering all units including newly established professional companies, achieving 100% coverage[198] - In 2022, the company performed independent internal control evaluations on 5 subsidiaries, completing a three-year full coverage of all subsidiaries[199] - The company revised its internal control manual, authority list, and implementation rules in 2022, adding DICT business management processes and optimizing processes for government and enterprise business, procurement management, and financial analysis[197] - The internal audit department regularly reports audit results to the audit committee and board on a quarterly basis, ensuring effective risk management and internal control systems[197] - The company implemented a closed-loop management system for internal control issues, with most identified defects and issues rectified by the end of 2022[199] - The company strengthened IT internal control construction, improving the efficiency, effectiveness, and security of internal monitoring systems[196] - The company conducted a risk assessment for 2023, identifying key risk points in areas such as economic and policy environment adaptation, business operations, and network security[196] - The company's internal control evaluation system follows the guidelines of the 2201 Internal Audit Specific Standards issued by the China Internal Audit Association[198] - The company's board confirmed that the risk management and internal control systems are robust, appropriate, effective, and sufficient as of December 31, 2022[200] - The company emphasized the importance of network and information security, regularly conducting security checks and improving related management regulations[196] Sustainability and Green Development - The company reduced greenhouse gas emissions by over 13 million tons in 2022 through co-construction and sharing as well as energy-saving measures, with greenhouse gas emissions per unit of information traffic decreasing by 20.6% year-on-year[37] - The company built the first "zero-carbon data center" in Qinghai and actively promoted green cloud network construction and operation[37] - The company will focus on green and low-carbon development, integrating sustainability into its products and services[88] - The company has achieved significant energy savings, reducing electricity consumption by over 600 million kWh annually through the application of AI technology in mobile base stations and old equipment rooms[34] - The company has saved over RMB 270 billion in network construction costs and reduced annual operating costs by more than RMB 30 billion through the co-construction and sharing of 4G/5G base stations with China Unicom, with over 1 million 5G base stations and 1.1 million 4G base stations shared[34] - The company's annual electricity savings exceeded 600 million kWh through the application of AI technology in mobile base stations and old equipment rooms[47] Awards and Recognition - The company received multiple awards in 2022, including "Asia's Most Honored Company" for 12 consecutive years and "China's Most Outstanding Enterprise - Telecommunications Services" in the Asiamoney awards[38] - The company was recognized as "Asia's Most Honored Company" for the 12th consecutive year in the 2022 "Asia's Best Corporate Management Team"评选 by Institutional Investor[133] - The company won multiple awards, including "Best Overall ESG" and "Best Investor Relations," in the 2022 "Asia's Best Corporate Management Team"评选[133] - The company was awarded "China's Most Outstanding IPO" and "China's Most Outstanding Enterprise - Telecom Services" in the 2022 Asiamoney Outstanding Enterprise Awards[133] - The company received the "Best Practice for 2022 Annual Report Performance Briefing" from the China Listed Companies Association[133] Employee and Workforce Management - Total number of employees at the end of the reporting period is 280,683, with 31.68% being female employees and 21.30% being female managers[187] - The company has 49,650 employees in management, finance, and administration, 134,426 in sales and marketing, 74,265 in operations and maintenance, and 22,342 in research and product development[187] - Educational background of employees includes 493 with PhDs, 30,207 with master's degrees, 162,695 with bachelor's degrees, 67,958 with associate degrees, and 19,330 with high school education or below[187] - The company emphasizes equal employment opportunities and fair compensation, implementing equity incentives and profit-sharing mechanisms to motivate core talents[188] - The company focuses on training and development, organizing various leadership and professional training

Financial Performance - The operating revenue for Q1 2023 was RMB 130.588 billion, an increase of 9.2% year-on-year, with service revenue at RMB 118.478 billion, up 7.7%[1] - EBITDA for Q1 2023 reached RMB 33.874 billion, growing by 4.7% compared to the same period last year, with an EBITDA margin of 28.6%[1][5] - Profit attributable to shareholders was RMB 7.984 billion, reflecting a 10.5% increase year-on-year, with basic earnings per share at RMB 0.09, up 12.5%[3][5] - The net profit for Q1 2023 was RMB 7.972 billion, an increase from RMB 7.264 billion in the same period last year[10] - The total comprehensive income was RMB 7,883 million, an increase of 11.7% compared to RMB 7,055 million for the same period in 2022[11] - The net profit attributable to shareholders of the company was RMB 7,984 million, up 10.5% from RMB 7,223 million year-over-year[11] - The basic and diluted earnings per share for the period were both RMB 0.09, compared to RMB 0.08 in the same period last year, reflecting a 12.5% increase[11] User Growth and Service Metrics - The total number of mobile users reached 399.87 million, with a net increase of 7.52 million users in Q1 2023[4] - The number of 5G package users increased by 15.25 million to 282.1 million, achieving a penetration rate of 71.0%[4][5] - Fixed broadband users reached 184 million, with a revenue of RMB 31.136 billion, marking a 5.0% year-on-year growth[5] - The average revenue per user (ARPU) for mobile users was RMB 45.8, while the broadband ARPU reached RMB 47.5[5] - The smart home service revenue grew by 15.9% year-on-year, contributing to the overall growth in broadband services[5] Digital Transformation and Future Growth - The company is focusing on digital transformation and enhancing 5G network coverage to improve user experience and service quality[5] - In Q1 2023, the company's digital industry revenue reached RMB 34.971 billion, representing an 18.9% year-over-year growth[6] - The company aims to enhance its digital capabilities and strengthen core technologies to drive future growth[6] - The company plans to deepen its reform mechanisms and stimulate employee innovation to improve core competitiveness[6] Financial Position and Assets - Total assets at the end of the reporting period were RMB 823.656 billion, a 2.0% increase from the previous year[3] - The company's total assets as of March 31, 2023, were RMB 823.656 billion, up from RMB 807.698 billion at the end of 2022[8] - The total liabilities as of March 31, 2023, were RMB 379.345 billion, compared to RMB 371.271 billion at the end of 2022[8] - The company reported a total of RMB 40.734 billion in net accounts receivable as of March 31, 2023, compared to RMB 24.312 billion at the end of 2022[7] - The company’s cash and cash equivalents stood at RMB 74.642 billion as of March 31, 2023, compared to RMB 72.465 billion at the end of 2022[7] Cash Flow and Expenditures - The net cash generated from operating activities was RMB 28,215 million, an increase of 2.2% from RMB 27,613 million in the previous year[12] - Capital expenditures for the period were RMB 14,504 million, down 7.4% from RMB 15,669 million in the same period last year[12] - The company reported a net cash outflow from investing activities of RMB 15,943 million, an improvement from RMB 17,617 million in the previous year[12] - The net cash used in financing activities was RMB 9,977 million, a decrease of 26.5% compared to RMB 13,559 million in the same period last year[12] - As of March 31, 2023, cash and cash equivalents amounted to RMB 74,642 million, an increase from RMB 69,698 million at the end of the same period last year[12] Cautionary Statements - The company emphasized that the financial and operational data provided are based on management accounts and are unaudited, urging investors to exercise caution[15] - Forward-looking statements regarding development strategies and future business plans are subject to known and unknown risks and uncertainties, which may cause actual results to differ significantly from those implied[15]