CHT(US:CHT)2024-04-17 10:05Financial Performance - In 2023, Chunghwa Telecom reported revenues of NT$223.2 billion (US$7.3 billion) and a consolidated net income of NT$38.1 billion (US$1.2 billion), with basic earnings per share of NT$4.76 (US$0.16) [80] - Total revenues increased to NT$223.2 billion (US$7.3 billion) in 2023, up from NT$216.7 billion in 2022, representing a growth of 2.3% [272] - Consolidated net income for 2023 was NT$38.1 billion (US$1.2 billion), slightly up from NT$37.9 billion in 2022 [272] - Operating costs increased from NT$136.7 billion in 2022 to NT$141.8 billion in 2023, reflecting a rise of 3.8% [272] - Total operating expenses increased from NT$33.3 billion in 2022 to NT$34.4 billion in 2023, a rise of 3.3% [272] Revenue Breakdown - In 2023, the company generated NT$65.0 billion (US$2.1 billion) in mobile services revenue, accounting for 29.1% of total revenues, driven by an increase in subscriber numbers and recovery in roaming revenues post-pandemic [117] - Revenues from the consumer business accounted for 61.4% of total revenues, showing an increase from 60.9% in 2022, primarily due to growth in mobile services and fixed broadband services [255] - The enterprise business revenues represented 32.7% of total revenues in 2023, a slight decrease from 33.3% in 2022, attributed to a high basis of ICT business revenues recognized from large one-time projects in 2022 [257] - Mobile service revenues increased by 6.4% from NT$51.8 billion in 2022 to NT$55.1 billion (US$1.8 billion) in 2023, driven by postpaid subscriber growth and 5G migration [273] - Fixed-line service revenues slightly decreased by 0.4% from NT$42.8 billion in 2022 to NT$42.6 billion (US$1.4 billion) in 2023 [274] - Revenues from sales increased by 4.7% from NT$35.2 billion in 2022 to NT$36.8 billion (US$1.2 billion) in 2023, attributed to stabilized smartphone supply [274] - Other revenues rose by 11.3% from NT$2.3 billion in 2022 to NT$2.6 billion (US$0.1 billion) in 2023, driven by ICT and home security services [275] Capital Expenditures and Investments - The company made capital expenditures totaling NT$30.7 billion (US$1.0 billion) in 2023 [81] - Capital expenditures focused on modernizing mobile services and developing FTTx networks, with a long-term goal of optimizing investments for innovative products [264] - The company invested NT$2.6 billion in NCB, increasing its equity interest from 41.9% to 46.3% by the end of 2023, focusing on targeting younger demographics and developing innovative fintech services [105] - The company invested in a green and sustainable time deposit in 2023, channeling funds into eco-friendly projects [1] Market Position and Services - As of December 31, 2023, the company held a 56.8% subscriber market share as the largest ISP in Taiwan, with 82.3% of broadband customers also using HiNet as their ISP [136] - The company maintains a 100% payout ratio for 2023 earnings, reflecting its commitment to maximizing stockholder value [110] - Chunghwa Telecom's MOD service is the largest video platform in Taiwan in terms of customer numbers [80] - The company holds over 50% market share in the IDC business, making it the leading IDC service provider in Taiwan [173] - The company operates 443 service centers and 240 SENAO exclusive service stores as of December 31, 2023, to improve customer service and distribution capabilities [165] Customer and Subscriber Metrics - As of December 31, 2023, the company had approximately 11.2 million mobile customers, holding a market share of approximately 37.6% in total mobile customers and 40.0% in mobile services revenues in Taiwan [119] - Total HiNet subscribers increased from 4,012 thousand in 2022 to 4,032 thousand in 2023, while FTTx subscribers rose from 3,479 thousand to 3,526 thousand during the same period [137] - The postpaid ARPU for mobile services increased from NT$525 in 2022 to NT$547 in 2023, reflecting a focus on customer value creation and steady 5G migration [118] - The ARPU for broadband services per month increased from NT$745 in 2021 to NT$774 in 2023, reflecting growing demand for broadband speed upgrades [134] Technological Advancements and Services - Chunghwa Telecom successfully launched 5G services in Taiwan in 2020 and continues to enhance its 4G/5G mobile broadband networks [97] - The company aims to maintain its broadband market share and increase average revenue per user (ARPU) for FTTx internet services [95] - The company constructed approximately 11.8 million FTTx ports, offering high-speed broadband access rates up to 2 Gbps [179] - The company has deployed 1,230 wavelengths for 100 Gbps and 189 wavelengths for 200 Gbps in its OTN network by the end of 2023 [178] Regulatory Environment - The Telecommunications Management Act (TMA) reduces entry barriers to the telecommunications market by changing the concession approval system to a registration system, promoting competition [211] - The TMA categorizes obligations of telecommunications enterprises into general, special, and designated obligations, ensuring transparency and consumer protection [214] - The Fair Trade Act (FTA) empowers the FTC to investigate and impose penalties for anti-competitive conduct, ensuring fair competition in the telecommunications market [224] Sustainability and Corporate Responsibility - The company plans to reduce Scope 1 and 2 Greenhouse Gas emissions by 50% by 2030 compared to 2020 levels, with a commitment to achieve net-zero by 2050 [239] - An internal carbon pricing of NT$1,600 per tonne of CO2e has been adopted to fund carbon reduction initiatives [239] - The company aims to use 100% renewable energy for its data centers by 2030 and for the entire company by 2040, having signed power purchase agreements for solar and wind energy that provided approximately 73 million kWh in 2023 [239] - The company has committed to achieving Net Positive Impact on biodiversity and No Net Deforestation by 2030, with plans to plant 150,000 trees over eight years [240] - The company established the Sustainable Development and Strategy Committee to guide long-term sustainability goals and strategies, reflecting the United Nations' Sustainable Development Goals [237] Employee and Operational Initiatives - Employee salaries will increase by NT$3,000 starting January 1, 2024, resulting in an average salary increase of over 4% [241] - The company has implemented a childcare allowance and paid leave for employees with young children to support work-life balance [241] - The company is the first telecommunications provider in Taiwan to comply with ISO 45001:2018 for occupational health and safety [242] - The company has developed comprehensive anti-fraud measures, including an international fraud calls alerting service to combat scam phone calls [242]