Hong Kong fixed-line phone operator PCCW (ticker: PCW) reported (WSJ subscription required) a
net profit of $210 million for 2004, compared to a loss of $782
million in 2003. Revenue was bolstered by PCW's property and broadband services. But the company's core phone business continued to decline.
(all percentage changes and comparisons are year on year, unless stated otherwise)
- Revenue increased 1.5% to $2.94 billion.
- Revenue from telecom services fell 8.1%; revenue from property sales was $692 million.
- Net profit was $210 million, compared with a loss of $782 million.
- Net profit results were in-line with consensus expectations.
- The company proposed a dividend of $0.012.
The company said it cut its net debt
by 10% to $3.36 billion.
- Strong results arose from the company's property operations, broadband
Internet and broadband television businesses.
PCW is losing about 6,000 phone lines a
month, compared with more than 25,000 per month in the middle of 2003.
- The company is continuing discussions with China Netcom (ticker: CN), which recently acquired a 20% stake in PCW.
- PCW intends to acquire a
stake of no more than 49% in Netcom's broadband unit.
- The companies will jointly roll out broadband
service in six southern China cities, including Hangzhou, Ningbo,
Wenzhou, Yangzhou, Chongqing and Chengdu.
- PCW and CN will also
develop a yellow pages business by developing a multimedia platform to
promote business in both mainland China and Hong Kong through print,
Web-based and mobile short text messages.
- PCW and China Netcom will also collaborate on real-estate deals.
At end of 2004,
361,000 customers had installed PCW's broadband-TV service, called Now
53% of TV customers were paying for premium channels.
remaining 47% received basic Now TV free when they signed up and paid for a
PCW broadband-Internet service, called Netvigator.
- The company said its fixed-line market share is about 68%, down from 73% at the end of 2003, and 82% at the end of 2002.
PCW's stock market performance: