HKT(HK:06823)2021-09-02 08:38Financial Performance - Hong Kong Telecom recorded strong performance for the six months ended June 30, 2021, with adjusted cash flow returning to healthy growth[6]. - Revenue for the first half of 2021 reached HKD 12 billion, reflecting a 5% increase compared to the same period last year[20]. - The company reported a significant increase in revenue, achieving a total of $1.5 billion for the quarter, representing a 15% year-over-year growth[31]. - Total revenue increased by 7% to HKD 15.643 billion, driven by strong demand for broadband and data services, as well as increased adoption of 5G services and mobile phone sales[32]. - The company reported a net profit for the period was HKD 1,908 million, slightly up from HKD 1,905 million in 2020, indicating a marginal growth of 0.2%[84]. - The company has outlined a future outlook with a projected revenue growth of 8% for the next fiscal year, driven by new product launches and market expansion strategies[20]. 5G and Digital Services - The number of 5G customers surpassed 500,000, accounting for approximately 16% of postpaid mobile customers[6]. - The company experienced an increase in average revenue per user (ARPU) and total service revenue due to the continued shift of customers to 5G services[6]. - The company aims to strengthen its 5G business to enhance consumer and business adoption of 5G services, capitalizing on the recovering local economy[17]. - The company expanded its 5G network coverage to popular hiking routes and remote scenic spots, enhancing user experience and service availability[10]. - The company installed fiber optics in 12 villages in Sai Kung to support the government's policy of providing high-speed broadband services to remote areas[10]. Digital Transformation and Innovation - The digital business development accelerated, with significant increases in registered users for the Tap & Go payment platform following its selection for the government's consumption voucher scheme[7]. - Hong Kong Telecom aims to assist the public in adopting a digital lifestyle and promote the transformation of Hong Kong into a smart city[8]. - The company is committed to innovation and leveraging its unique "four networks in one" advantage for cross-selling opportunities[17]. - The company plans to promote digital transformation for businesses, contributing to Hong Kong's development as a smart city[17]. Advertising and Media - The advertising revenue from Now TV significantly increased due to exclusive broadcasts of major sporting events, including the UEFA Euro 2020 and Tokyo 2020 Olympics[6]. - Now TV's advertising revenue saw significant growth during the first half of the year, driven by exclusive broadcasts of the UEFA Euro 2020 and partnerships with popular local celebrities[13]. - The pay-TV business, including Now TV, generated revenue of HKD 1.231 billion and EBITDA of HKD 0.212 billion, benefiting from exclusive sports content[37]. Economic Outlook - The overall economic recovery in Hong Kong is expected to continue as vaccination rates improve, supporting business growth and stable returns for shareholders[8]. - The company is closely monitoring uncertainties that may affect economic progress, including the reopening of borders with mainland China[8]. - Current economic indicators show a positive recovery in Hong Kong's economy, benefiting the company's diversified business portfolio and strong financial position[17]. Customer Growth and Satisfaction - The number of accounts for Tap & Go increased to 3.5 million, with a significant rise in registered merchants for smart POS[17]. - The DrGo platform has expanded its user base to over 200,000, offering services such as hypertension management and mental health consultations[17]. - Customer satisfaction ratings have improved, with a reported increase of 12% in positive feedback from users[23]. Strategic Initiatives and Investments - Investment in new technology development has increased by 15%, focusing on enhancing digital services and infrastructure[20]. - The company plans to expand its market presence in Southeast Asia, targeting a 20% increase in market share over the next three years[20]. - A strategic acquisition of a local telecom firm is expected to be finalized by Q3 2021, which will enhance service offerings and customer base[20]. - The company is committed to sustainability initiatives, with plans to reduce carbon emissions by 25% by 2025[20]. Financial Management and Cost Control - Operating expenses have been managed effectively, resulting in a 3% reduction compared to the previous quarter[20]. - The board has approved a dividend payout of HKD 0.50 per share, maintaining a stable return for shareholders[20]. - The company has initiated a cost-reduction strategy expected to save HKD 200 million annually[24]. Shareholder Value and Returns - The interim distribution per unit is set at HKD 0.307[38]. - The company has initiated a share buyback program, reflecting its commitment to returning value to shareholders[95]. - The board has approved a dividend of $0.50 per share, reflecting a commitment to returning value to shareholders[31].