China fixed-line operator, China Telecom (ticker: CHA), announced (WSJ subscription required) its
net profit doubled in 2004 to $3.38 billion (assuming use of the company's restated financial numbers for 2003). Here are the details:
2004 Financial Results:
(all percentage changes and comparisons are year on year, unless stated otherwise)
- Revenue rose 6.4% to $19.5 billion.
- Internet service revenue was $1.7 billion.
telephone and Internet services subscribers were the key drivers of revenue
- Net profit doubled to $3.4 billion.
- Analysts had forecast net profits between $2.9 billion and $3.1 billion.
- The company restated its figures for 2003 to reflect
the revaluation of the 10 provincial networks that it acquired from its
parent in April of last year.
Removing the impact of asset
revaluation, which China Telecom conducts every three years, analysts
said the company's results would have shown high-single-digit year-on-year
Local telephone-service customers
increased 16% to 186.65 million, which includes 42.2 million users of
its wireless local access service, known as "Little Smart".
- Broadband subscriber base grew 91% to 13.84 million.
Capital expenditures are expected to drop slightly to $6.8 billion.
- Capital expenditure covers the upgrade of its network and preparations
for 3G networks.
CHA will reduce its capital expenditure on wireless local
It will focus more on developing its
broadband and internet-based networks.
It expects value-added services, such as short
text messages, and broadband to grow.
As of the end of February 2005, China had:
- 344 million mobile users.
- 320 million fixed-line
- Mobile penetration rate of 26%.
For more on China Telecom and other Chinese telecom companies, see here from the China Stock Blog.