China Telecom books 2% growth in 2019 service revenue

25 Mar 2020

Full-service provider China Telecom has recorded a 0.4% dip in annual operating revenue to CNY375.7 billion (USD53.1 billion) for the full year to end-December 2019, but service revenue grew by 2.0% year-on-year to CNY357.6 billion, fuelled by subscriber growth in the mobile, fixed broadband and IPTV segments. EBITDA for the year grew by 12.5% to CNY117.2 billion, whilst net profit dipped by 3.3% to CNY20.5 billion.

China Telecom recorded a total of 335.57 million mobile subscribers at the end of 2019, compared to 303.00 million twelve months earlier, of which 281.24 million were 4G users (242.43 million) and 4.61 million were 5G subscribers. The number of IoT connected devices, meanwhile, grew from 106.93 million to 157.41 million. Fixed broadband subscriptions also saw growth with the telco counting 153.13 million users at 31 December 2019, a net increase of 7.34 million y-o-y. However, ARPUs were compressed by government instructions to reduce tariffs along with price competition: blended mobile ARPU fell 9.3% y-o-y to CNY45.8 per month whilst broadband ARPU dropped by 14.0% to CNY38.1.

Regarding the nascent 5G segment, Telecom reported a total of 4.61 million 5G package subscribers at the end of December 2019, with that figure rising to 10.73 million by end-February 2020. At the latter date, 5G ARPU was CNY91.9 per month and the monthly average data use per customer stood at around 13.2GB. The company is aiming to sign up between 60 million and 80 million 5G users by the end of 2020, by which date it hopes to have deployed more than 300,000 5G base transceiver stations (BTS) to cover all prefecture level or above cities nationwide. To achieve this, the company is setting aside more than half of its planned CAPEX for 2020 for 5G network construction and development – equating to around CNY45.3 billion, compared to a 5G spend of around CNY9.3 billion in 2019 (12% of its 2019 CAPEX).

China, China Telecom Corporation