Chunghwa reports impact of COVID-19 on Q1 revenues

5 May 2020

Taiwan’s Chunghwa Telecom has published its financial results for the quarter ended 31 March 2020, posting a 6.2% year-on-year drop in turnover as its chairman and CEO, Chi-Mau Shieh, said the company ‘experienced a challenging start to 2020’. For the three-month period under review Chunghwa generated a total turnover of TWD48.15 billion (USD1.6 billion), down from TWD51.33 billion in the first quarter of 2019. Mobile communications revenue in 1Q20 declined by 7.9% to TWD22.54 billion, with the operator saying this was ‘mainly due to the decrease in handset sales revenue and the decrease in mobile service revenue resulted from market competition, VoIP substitution, as well as the impact of COVID-19 on roaming revenue’. Domestic fixed revenue was also down y-o-y, falling 6.7% to TWD14.69 billion, while international fixed turnover slumped 17.6% to TWD2.24 billion. Internet revenues were, however, more stable, standing unchanged y-o-y at TWD7.51 billion.

Chunghwa meanwhile reported EBITDA of TWD19.35 billion for the first quarter of 2020, representing a 1% increase on an annualised basis, though total operating costs and expenses in 1Q20 declined by 8.1%, to TWD37.62 billion, which it attributed primarily to ‘lower cost of goods sold, interconnection costs, and ICT project costs’. Net income for the period under review totalled TWD8.32 billion, down marginally from TWD8.36 million in 1Q19.

In operational terms, Chunghwa reported a mobile subscriber base of 11.01 million as at 31 March 2020, up 4.0% against the same date a year earlier. The telco also highlighted the continued growth in FTTx-based broadband accesses as it continued to execute on a strategy encouraging subscribers to migrate to the technology. At end-March 2020 it had 3.62 million FTTx-based subscribers on its books, equivalent to 82.4% of its total broadband customer base. Further, the operator reported that the number of subscribers signing up for speeds of 100Mbps or higher had increased by 11.4% y-o-y, to 1.62 million. Total broadband accesses were down marginally, however, standing at 4.39 million at the end of the reporting period, compared to 4.41 million at end-March 2019. Finally, in the fixed line voice market Chunghwa claimed to have ‘maintained its leading position’ with a total of 10.09 million subscribers at end-March 2020, although that figure represented a 2.6% drop from the 10.36 million it reported twelve months earlier.

Taiwan, Chunghwa Telecom