2019-08-23 08:54Financial Performance - Operating revenue for the first half of 2019 was RMB 389.4 billion, a decrease of 0.6% year-on-year[11]. - Communication service revenue reached RMB 351.4 billion, down 1.3% compared to the same period in 2018[11]. - EBITDA for the first half of 2019 was RMB 151.1 billion, an increase of 3.6% year-on-year, with an EBITDA margin of 38.8%[11]. - Shareholder profit was RMB 56.1 billion, representing a year-on-year decline of 14.6%[11]. - The company reported a capital expenditure of RMB 85.2 billion for the first half of 2019[11]. - The company's operating expenses amounted to RMB 329.7 billion, a year-on-year increase of 2.3%, accounting for 84.7% of operating revenue[24]. - The basic and diluted earnings per share for the first half of 2019 were RMB 2.74, compared to RMB 3.21 in the same period last year[29]. - The company reported a profit of RMB 56,063 million for the six months ended June 30, 2019, compared to RMB 65,641 million for the same period in 2018, indicating a decrease of approximately 14.6%[33]. - The interim dividend declared for the six months ended June 30, 2019, was RMB 27,504 million, compared to RMB 31,522 million in 2018, reflecting a decrease of 12.8%[53]. Customer Growth and Market Performance - The company added 9.98 million mobile customers, bringing the total to 935 million[11]. - 4G customer base increased by 21.13 million, reaching 734 million[11]. - The company's 4G customer DOU reached 7.1GB, a year-on-year increase of 132.5%[12]. - The net increase of Magic Box users was 14.33 million, with a penetration rate of 68.7%[12]. - The revenue from the home market and government-enterprise market showed double-digit growth, with DICT revenue reaching RMB 13.6 billion, up 47.3% year-on-year[11]. - Wireless internet business revenue was RMB 201.6 billion, reflecting a decline of 2.1% year-on-year; however, wired broadband revenue grew by 26.6% to RMB 32.9 billion[23]. - Application and information service revenue increased by 12.3% to RMB 41.1 billion, indicating an improving revenue structure[23]. Capital Expenditure and Investments - Capital expenditure for the first half of 2019 was RMB 85.2 billion, with RMB 38.4 billion allocated to 4G network investments[26]. - The total cost of property, plant, and equipment additions for the six months ended June 30, 2019, was RMB 84,841 million, compared to RMB 78,831 million in 2018, marking an increase of 7.7%[58]. - The total capital commitments for telecommunications equipment and others reached RMB 45,415 million, slightly up from RMB 44,174 million, showing a growth of about 2.8%[89]. Financial Position and Cash Flow - As of June 30, 2019, the company's total assets were RMB 1,648.1 billion, with total liabilities of RMB 564.5 billion, resulting in a debt-to-asset ratio of 34.3%[27]. - The free cash flow for the first half of 2019 was RMB 41.0 billion, with cash and bank deposits totaling RMB 327.6 billion as of June 30, 2019[27]. - The net cash inflow from operating activities for the six months ended June 30, 2019, was RMB 126,182 million, an increase from RMB 118,317 million in the same period of 2018, representing a growth of approximately 5%[34]. - The net cash outflow from investing activities decreased significantly to RMB 74,635 million from RMB 128,602 million year-on-year, indicating a reduction of about 42%[34]. - The net cash outflow from financing activities increased to RMB 37,671 million compared to RMB 27,872 million in the previous year, reflecting a rise of approximately 35%[34]. Corporate Governance and Compliance - The company has received recognition for its corporate governance, being awarded as a model for best corporate governance in Asia[20]. - The financial data presented is unaudited but has been reviewed by the audit committee and the external auditor, PwC, ensuring compliance with relevant accounting standards[36]. - The management has indicated no significant changes in financial risk management policies since the last annual report, maintaining stability in operations[38]. - The company fully complied with all code provisions of the Corporate Governance Code during the six months ending June 30, 2019[106]. Future Outlook and Strategic Initiatives - The company plans to build over 50,000 5G base stations nationwide and achieve commercial 5G services in over 50 cities within the year[18]. - The company aims to create a 5G open ecosystem by collaborating with various stakeholders, including internet companies and research institutions[19]. - The company is focused on high-quality development and aims to create a value-based operating system centered around 5G technology[21]. - The company recognizes the need to explore new development models and revenue growth points due to increasing competition and market challenges[21]. Taxation and Dividends - The estimated corporate income tax provision for the six months ended June 30, 2019, was RMB 25,939 million, an increase from RMB 25,294 million for the same period in 2018, representing a growth of 2.6%[51]. - The total tax expense for the six months ended June 30, 2019, was RMB 26,123 million, compared to RMB 25,477 million in 2018, reflecting a year-on-year increase of 2.5%[51]. - A withholding tax of 10% will be deducted from the interim dividend for non-resident corporate shareholders[110].