CHINA MOBILE(00941)2023-09-04 09:05Stock Options and Fair Value - The weighted average fair value of stock options granted was HKD 4.00 per share for the first grant and HKD 3.28 per share for the second grant[1]. - The average exercise price of stock options as of June 30, 2023, was HKD 52.60, with a total of 859,601,819 stock options outstanding[13]. - The average remaining contractual life of unexercised stock options as of June 30, 2023, was 8.5 years, down from 9.0 years as of December 31, 2022[14]. - The total number of stock options exercisable as of June 30, 2023, was 166,515,356[14]. - The stock option incentive plan approved in May 2020 allows for the issuance of up to 2,047,548,289 shares, representing approximately 9.58% of the company's total share capital as of August 10, 2023[72]. - The company has a remaining plan authorization of 1,159,948,571 stock options as of June 30, 2023[78]. - The company has not granted any stock options during the six months ended June 30, 2023[77]. - The weighted average exercise price for stock options exercised from January 13, 2023, to June 30, 2023, was HKD 55.00, with an average closing price of HKD 64.10 prior to the exercise date[80]. - The stock options will be exercisable in three tranches, with the first tranche (40%) opening 24 months after the grant date[78]. Financial Performance - The company's operating revenue for the first half of 2023 was RMB 530.7 billion, an increase of 6.8% compared to the same period last year[48]. - Communication service revenue reached RMB 452.2 billion, growing by 6.1% year-on-year[48]. - The company's net profit attributable to shareholders was RMB 76.2 billion, reflecting an 8.4% increase from the previous year[52]. - EBITDA for the first half of 2023 was RMB 183.5 billion, up 5.5% year-on-year, with an EBITDA margin of 34.6%[52]. - Operating expenses amounted to RMB 450.4 billion, a 6.6% increase year-on-year, accounting for 84.9% of operating revenue[49]. - Employee compensation and related costs rose to RMB 70.4 billion, a 10.2% increase compared to the previous year[49]. - The cost of sales for products was RMB 77.3 billion, increasing by 12.2% year-on-year, representing 14.6% of operating revenue[50]. - The company reported a free cash flow of RMB 79.1 billion for the six months ending June 30, 2023, with cash and bank balances totaling RMB 281.4 billion[56]. - The company aims to continue its prudent financial policy and maintain healthy cash flow generation capabilities[56]. Assets and Liabilities - As of June 30, 2023, the company's total assets amounted to RMB 1,991.6 billion, total liabilities were RMB 654.7 billion, resulting in a debt-to-asset ratio of 32.9%[54]. - The total equity attributable to shareholders increased to RMB 1,332,768 million from RMB 1,297,348 million, showing a growth of approximately 2.7%[170]. - Cash and cash equivalents reached RMB 204,928 million, up from RMB 167,106 million, representing an increase of about 22.6%[168]. - Accounts receivable surged to RMB 68,564 million from RMB 40,245 million, reflecting a significant increase of approximately 70.2%[168]. - The total amount of accounts payable as of June 30, 2023, was RMB 170,341 million, an increase from RMB 156,536 million as of December 31, 2022, representing a rise of approximately 8.8%[159]. - The company’s non-current liabilities decreased slightly to RMB 96,801 million from RMB 100,778 million, a decline of about 4.0%[170]. Capital Expenditure and Investments - In the first half of 2023, the company's capital expenditure reached RMB 81.4 billion, accounting for 18.0% of telecommunications service revenue, with RMB 42.3 billion allocated to 5G-related capital expenditure[53]. - The company has signed contracts for capital expenditures not yet recognized in the financial data, indicating ongoing investment in infrastructure[41]. - The company plans to utilize the raised funds in accordance with previously disclosed plans without significant changes or delays[58]. - As of June 30, 2023, the company had invested approximately RMB 42.9 billion of the raised funds, with RMB 8.46 billion remaining to be invested[58]. Revenue Growth and Market Performance - Revenue from communication facility construction services increased to RMB 771 million, up from RMB 701 million year-over-year, representing a growth of approximately 10%[17]. - Total revenue from integrated services decreased to RMB 167 million, down from RMB 179 million, reflecting a decline of about 6.7%[17]. - Technology support service fees decreased to RMB 152 million from RMB 191 million, a decline of approximately 20.4%[17]. - The personal market revenue reached RMB 259.4 billion, a year-on-year increase of 1.3%, with mobile customers totaling 985 million, net adding 10.38 million[119]. - The enterprise market revenue was RMB 104.4 billion, growing 14.6% year-on-year, with mobile cloud revenue at RMB 42.2 billion, up 80.5%[124]. - Emerging market revenue reached RMB 23.5 billion, a year-on-year increase of 18.4%, with international business revenue at RMB 10.1 billion, growing 25.9%[125]. Dividends and Shareholder Returns - The company declared an interim dividend of HKD 2.43 per share for the six months ended June 30, 2023[89]. - The company aims to distribute over 70% of its annual profit in cash to shareholders, enhancing shareholder value[115]. - The interim dividend per share declared was HKD 2.43, compared to HKD 2.20 in the previous year, reflecting an increase of about 10.5%[110]. - The company will withhold 10% corporate income tax on the interim dividend distributed to non-resident corporate shareholders[90]. Corporate Governance and Compliance - The company has fully complied with the Corporate Governance Code as per the Hong Kong Listing Rules during the six months ended June 30, 2023[86]. - The company did not purchase, sell, or redeem any of its listed securities during the six months ended June 30, 2023[83]. - The company’s auditor has issued a report on the financial statements without any reservations[197]. - The interim financial data is prepared in accordance with international accounting standards and complies with applicable disclosure requirements[193]. Strategic Initiatives and Future Outlook - The company is advancing its digital transformation strategy to stimulate high-quality development and create new growth momentum[57]. - The company is actively pursuing 6G research and has proposed a systematic 6G network architecture, showcasing its commitment to future technology[140]. - The company is enhancing its ESG management practices, focusing on sustainable development and social contributions, which have garnered high social recognition[144]. - The company is expanding its strategic partnerships with local governments and enterprises to promote digital economy innovation and cross-industry collaboration[142].