Unicom warns of 80% decline in profit

3 Aug 2016

China Unicom, China’s second largest telecoms provider by subscribers, has issued a profit warning, informing shareholders that net profit for H1 2016 is expected to decline by roughly 80% year-on-year. The full service provider attributed the slump to a substantial increase in network, operation and support expenses, specifically: a significant increase in selling and marketing expenses, the addition of a tower usage fee and higher energy charges and property rentals. Unicom added, though, that profit is expected to represent a significant improvement from the net loss attributable to shareholders (excluding the gain on disposal of tower assets) of CNY3.36 billion (USD506.12 million) in the second half of 2015. Indeed, the operator stated the group’s operations were on track in H1 2016, having overcome operational challenges to achieve net growth in its mobile subscriber base, reversing the previous year’s downward trend. Unicom plans to publish its full interim results for H1 2016 on 17 August 2016.

China, China Unicom