i-Cable net profits fall 78%

13 Aug 2008

Hong Kong-based triple-play operator i-Cable has reported revenues of HKD1.07 billion (USD137 million) for the first six months of this year, down 10% from a year earlier, as earnings before interest, tax, depreciation and amortisation (EBITDA) decreased by 32% to HKD205 million. Net profit decreased by 78% year-on-year to HKD26 million from HKD116 million in 1H 2007. A HKD15 million adjustment for deferred tax due to the reduction in the Hong Kong profits tax rate resulted in an increase in the group’s income tax expenses for the period.

i-Cable saw a rise in its cable TV subscriber base of just 1%, or 10,000 viewers, to 892,000, in the six months to the end of June 2008. Pay-TV revenues were down 16% to HKD699 million, mainly attributable to dilution from lower yield subscriptions; pay-TV operating profit fell 39% to HKD61 million. The cableco is fighting tough competition from PCCW’s ‘now’ IPTV service, which recently outbid it for the rights to broadcast English Premier League football matches.

At i-Cable’s Internet & Multimedia division, turnover was largely unchanged at HKD295 million in the first half, although broadband subscribers decreased by 26,000 or 9% year-on-year to 280,000, and voice lines in service decreased by 4% to 153,000. Internet & Multimedia operating costs after depreciation decreased by 3% to HKD202 million partly due to lower depreciation charges, and the division’s operating profit increased by 8% to HKD93 million.

Consolidated capital expenditure during the six months amounted to HKD68 million, 4% lower than the same period last year. Major investments included cable network upgrades and expansion, new television production facilities and broadband internet/multimedia equipment.

Hong Kong, i-Cable (formerly HKCT)