City Telecom (including Hong Kong Broadband Network) has announced interim results for its fiscal first six months ended 29 February 2008. According to its press release, consolidated revenues grew by 10.9% year-on-year to HKD623.8 million (USD80 million) due to strong growth in its Fixed Telecommunications Network Services (FTNS) business. FTNS revenue increased by 19.1% year-on-year to HKD474.9 million, with subscription growth of 43,000 to a total of 726,000 (broadband, voice and IPTV services) during the six-month period, contributing 76.1% of the group’s turnover. The broadband and fixed local access growth more than compensated for a decline in City’s international direct dial (IDD) revenues by 8.9% year-on-year to HKD148.9 million. The drop in IDD sales was a result of intensive competition from traditional IDD services and VoIP-based competition, as well as from the group’s proactive migration of IDD customers to its own FTNS ‘2b’ VoIP service. However, the company reported that the IDD decline had slowed to a moderate level over the past 18 months. IDD traffic volume fell by 9.1% from 329 million minutes in 1H FY07 to 299 million minutes in 1H FY08. Consolidated EBITDA in the most recent six-month period decreased by 0.6% year-on-year to HKD187.1 million, whilst EBITDA margin decreased from 33.5% to 30.0%, mainly due to an increase in advertising expenditure on ‘brand enhancement’.