CHT sees net income drop in 2Q12 as operating costs rise

30 Aug 2012

Taiwanese multi-service provider Chunghwa Telecom (CHT) has reported a 15.2% year-on-year decline in net income for the second quarter of 2012. The telco posted net profit of TWD11.27 billion (USD379 million) in the three months to end-June 2012, as earnings before interest, tax, depreciation and amortisation (EBTIDA) fell by 3.6% to TWD22.58 billion. CHT pointed to increased operational costs and expenses as part of the reason for the decline in EBITDA, with higher costs atttibuted to handset sales cited as a key factor in such an increase. CHT meanwhile also highlighted that revenues had remained flat against the same period a year earlier, with the telco in 2Q 2012 recording a total turnover of TWD54.19 billion, with mobile revenue accounting for 45.7% of that total. Mobile turnover actually increased by 10.7% y-o-y, mainly CHT said thanks to higher revenues from value added services (VAS) and handset sales related to smartphone promotions. Internet revenues however fell by 4% against 2Q11 to TWD6.0 billion, a decline with the telco said stemmed from tariff reductions.

With CHT continuing to encourage its customers to migrate to its fibre-to-the-x (FTTX) services, at the end of June 2012 the telco recorded 2.61 million fibre broadband customers, up 18.5% y-o-y, and representing 57.2% of its overall high speed internet subscriber base. Mobile voice accesses meanwhile stood at 10.13 million, representing a 2.7% increase against end-June 2011. CHT also said it had two million mobile internet subscribers at the end of 2Q12, a figure which it claims keeps it on track to reach its target of 2.35 million such accesses by end-2012.

Dr Shyue-Ching Lu, CHT’s chairman and CEO, said of the company’s results: ‘In spite of continued regulatory pressure and intense market competition, we were very pleased that we were able to meet our earlier guidance for the first half of 2012.’

Taiwan, Chunghwa Telecom