TAIPEI, Taiwan, April 28, 2016 /PRNewswire/ -- Chunghwa
Telecom Co., Ltd. (TAIEX: 2412, NYSE: CHT) ("Chunghwa" or "the
Company") today reported its un-audited operating results for the
first quarter of 2016. All figures were prepared in accordance with
Taiwan-International Financial Reporting Standards ("T-IFRSs") on a
consolidated basis.
(Comparisons throughout the press release, unless otherwise
stated, are made with regard to the prior year period)
First Quarter 2016 Financial Highlights
- Total revenue increased by 0.8% to NT$56.94 billion
- Mobile communications revenue increased by 0.6% to NT$28.16 billion
- Mobile value-added services (VAS) revenue increased by 7.6% to
NT$10.31 billion, with mobile
Internet revenue, the largest contributor to VAS revenue,
increasing by 8.7%
- Smart device sales revenue decreased by 2.1% to NT$7.89 billion
- Internet revenue increased by 4.7% to NT$6.70 billion
- Domestic fixed communications revenue increased by 1.5% to
NT$17.80 billion
- International fixed communications revenue decreased by 10.2%
to NT$3.49 billion
- Total operating costs and expenses decreased by 3.4% to
NT$43.15 billion
- Net income attributable to stockholders of the parent increased
by 11.9% to NT$11.66 billion
- Basic earnings per share (EPS) was NT$1.50
Dr. Rick L. Tsai, Chairman and
CEO of Chunghwa Telecom stated, "Chunghwa Telecom continues to make
solid strides in growing our 4G, ICT and enterprise businesses, as
well as maintaining control of our operational costs and expenses,
as evidenced by our financial and operating results in the first
quarter of 2016. First, we were able to boost our profitability at
a faster pace than our peers, with EPS increasing by 11.9% year
over year. Second, on the mobile side, we grew mobile internet
revenue by 8.7% year over year, and accumulated 5.21 million 4G
subscribers by the end of the first quarter, propelling our market
share to reach 38.6%. In addition, we led the way in deploying our
2.6G frequency band on March 24, and
on top of that we also launched the new Big 4G promotion plans to
cater to demands of a wide spectrum of customers from high-to
low-end. We believe these initiatives will help us to improve data
speeds and attract additional mobile internet customers."
Revenue
Chunghwa Telecom's total revenues for the first quarter of 2016
increased by 0.8% to NT$56.94
billion.
Mobile communications revenue for the first quarter 2016
increased by 0.6% to NT$28.16
billion. This was mainly due to the continual growth of
mobile VAS revenue which was partially offset by the decrease in
mobile voice revenue and smart device sales. The decrease in mobile
voice revenue was mainly due to increased market competition and
VoIP substitution.
Internet business revenue for the first quarter of 2016
increased by 4.7% year-over-year to NT$6.70
billion. The increase was primarily attributable to higher
data communications revenue and application value-added service
revenue.
Domestic fixed revenue for the first quarter of 2016 increased
by 1.5% year-over-year to NT$17.80
billion, mainly due to the increase of the ICT project
revenue which offset the decrease of local and DLD service revenue.
Local and DLD service revenue decreased by 4.7% and 6.8%,
respectively, mainly due to increased mobile and VoIP substitution.
Broadband access revenue decreased by 0.7% to NT$4.83 billion.
International fixed revenue decreased by 10.2% to NT$3.49 billion mainly due to lower international
long distance revenue because of increased market competition,
which offset the increase of international data revenue.
Operating Costs and Expenses
Total operating costs and expenses for the first quarter of 2016
decreased by 3.4% year over year to NT$43.15
billion, mainly due to the lower interconnection expenses,
cost of goods sold and depreciation expenses.
Operating Income and Net Income
Income from operations for the first quarter of 2016 increased
by 17.0% to NT$13.78 billion. The
operating margin was 24.2%, compared to 20.9% in the same period of
2015. Net income attributable to stockholders of the parent
increased by 11.9% to NT$11.66
billion. Basic earnings per share was NT$1.50.
Cash Flow and EBITDA
Cash flow from operating activities for the first quarter of
2016 decreased by 44.9% to NT$6.49
billion, which mainly resulted from the cash contributions
to the pension fund as required under the Labor Law in Taiwan.
Cash and cash equivalents as of March
31st, 2016 increased by 12.2% to NT$34.54 billion as compared to that as of
March 31st, 2015.
EBITDA for the first quarter of 2016 increased by 7.8% to
NT$21.92 billion and EBITDA margin
was 38.5% compared to 36.0% in the same period of 2015.
Business and Operational Highlights
Broadband/HiNet
The Company continued to execute its strategy of encouraging
FTTx migration. As of March
31st, 2016, the number of FTTx subscribers
reached 3.41 million, accounting for 75.8% of the Company's total
broadband users. Moreover, the number of subscribers signing up for
speeds of 100Mbps or higher increased by 15.7% year over year,
reaching more than 1.08 million.
HiNet broadband subscribers decreased by 0.5% year-over-year,
totaling 3.77 million as of March
31st, 2016.
Mobile
As of March 31st,
2016, Chunghwa had 11.04 million mobile subscribers,
representing a 1.5% year-over-year decrease. The Company also had
6.28 million mobile Internet subscribers, representing a 17.3%
year-over-year increase.
As of March 31st, 2016,
the company accumulated 5.21 million 4G subscribers.
Fixed line
As of March 31st, 2016,
the Company maintained its leading position in the fixed-line
market, with a total of 11.11 million subscribers.
Financial Statements
Financial statements and additional operational data can be
found on the Company's website at
http://www.cht.com.tw/en/ir/stockit-earningsit.html.
NOTE CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. These
statements constitute "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and as defined in the U.S. Private Securities Litigation Reform Act
of 1995. These forward-looking statements can be identified by
terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements.
Statements that are not historical facts, including statements
about Chunghwa's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. A number of important factors
could cause actual results to differ materially from those
contained in any forward-looking statement. Investors are cautioned
that actual events and results could differ materially from those
statements as a result of a number of factors including, but not
limited to the risks outlined in Chunghwa's filings with the U.S.
Securities and Exchange Commission on Forms F-1, F-3, 6-K and 20-F,
in each case as amended. The forward-looking statements in this
press release reflect the current belief of Chunghwa as of the date
of this press release and Chunghwa undertakes no obligation to
update these forward-looking statements for events or circumstances
that occur subsequent to such date, except as required under
applicable law.
This press release is not an offer of securities for sale in
the United States. Securities may
not be offered or sold in the United
States absent registration or an exemption from
registration. Any public offering of securities to be made in
the United States will be made by
means of a prospectus that may be obtained from the issuer or
selling security holder and that will contain detailed information
about the company and management, as well as financial
statements.
NON-GAAP FINANCIAL MEASURES
To supplement the Company's consolidated financial statements
presented in accordance with International Financial Reporting
Standards pursuant to the requirements of the Financial Supervisory
Commission, or T-IFRSs, Chunghwa Telecom also provides EBITDA,
which is a "non-GAAP financial measure". EBITDA is defined as
consolidated net income (loss) excluding (i) depreciation and
amortization, (ii) total net comprehensive financing cost (which is
comprised of net interest expense, exchange gain or loss, monetary
position gain or loss and other financing costs and derivative
transactions), (iii) other income, net, (iv) income tax, (v)
(income) loss from discontinued operations.
In managing the Company's business, Chunghwa Telecom relies on
EBITDA as a means of assessing its operating performance because it
excludes the effect of (i) depreciation and amortization, which
represents a non-cash charge to earnings, (ii) certain financing
costs, which are significantly affected by external factors,
including interest rates, foreign currency exchange rates and
inflation rates, which have little or no bearing on our operating
performance, (iii) income tax (iv) other expenses or income not
related to the operation of the business.
CAUTIONS ON USE OF NON-GAAP FINANCIAL MEASURES
In addition to the consolidated financial results prepared under
T-IFRSs, Chunghwa Telecom also provide non-GAAP financial measures,
including "EBITDA". The Company believes that the non-GAAP
financial measures provide investors with another method for
assessing its operating results in a manner that is focused on the
performance of its ongoing operations.
Chunghwa Telecom's management believes investors will benefit
from greater transparency in referring to these non-GAAP financial
measures when assessing the Company's operating results, as well as
when forecasting and analyzing future periods. However, the Company
recognizes that:
- these non-GAAP financial measures are limited in their
usefulness and should be considered only as a supplement to the
Company's T-IFRSs financial measures;
- these non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, the Company's T-IFRSs
financial measures;
- these non-GAAP financial measures should not be considered to
be superior to the Company's T-IFRSs financial measures; and
- these non-GAAP financial measures were not prepared in
accordance with T-IFRSs and investors should not assume that the
non-GAAP financial measures presented in this earnings release were
prepared under a comprehensive set of rules or
principle.
Further, these non-GAAP financial measures may be unique to
Chunghwa Telecom, as they may be different from non-GAAP financial
measures used by other companies. As such, this presentation of
non-GAAP financial measures may not enhance the comparability of
the Company's results to the results of other companies. Readers
are cautioned not to view non-GAAP results as a substitute for
results under T-IFRSs, or as being comparable to results reported
or forecasted by other companies.
About Chunghwa Telecom
Chunghwa Telecom (TAIEX 2412, NYSE: CHT) is Taiwan's largest integrated telecommunications
services company that provides fixed-line, mobile, broadband, and
internet services. The Company also provides information and
communication technology services to corporate customers. In recent
years, Chunghwa has been actively involved in corporate social
responsibility and has won domestic and international awards and
recognition. For more information, please visit our website at
http://www.cht.com.tw.
Contact:
Fu-fu Shen
Phone: +886-2-2344-5488
Email: chtir@cht.com.tw
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SOURCE Chunghwa Telecom Co., Ltd.