TAIPEI, Aug. 6, 2024
/PRNewswire/ -- Chunghwa Telecom Co., Ltd. (TAIEX: 2412, NYSE: CHT)
("Chunghwa" or "the Company") today reported its un-audited
operating results for the second quarter of 2024. 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.)
Second Quarter 2024 Financial Highlights
- Total revenue increased by 1.2% to NT$
54.12 billion.
- Consumer Business Group revenue increased by 2.6% to
NT$ 33.60 billion.
- Enterprise Business Group revenue decreased by 3.7% to
NT$ 16.89 billion.
- International Business Group revenue increased by 21.8% to
NT$ 2.64 billion.
- Total operating costs and expenses increased by 2.4% to
NT$ 42.19 billion.
- Operating income decreased by 2.7% to NT$ 11.93 billion.
- EBITDA decreased by 1.7% to NT$ 21.81
billion.
- Net income attributable to stockholders of the parent decreased
by 1.0% to NT$ 9.82 billion.
- Basic earnings per share (EPS) was NT$1.27.
- Operating income, EBITDA, net income attributable to
stockholders of the parent, and EPS all exceeded our proposed
guidance.
"The year-over-year improvements in the second quarter
underscored the strength of our strategic execution and operational
excellence," stated Mr. Shui-Yi Kuo,
Chairman and CEO of Chunghwa Telecom. "Chunghwa Telecom is
delivering industry-leading, best-in-class service to our
customers. As a result, we have proudly set a new record for total
revenue for the same period since 2018, increasing our mobile
revenue market share and subscriber share in the new market
landscape. Our postpaid mobile ARPU has continued to outperform
peers, demonstrating the highest YoY growth in the Taiwanese
telecom industry for six consecutive quarters. Additionally, our
fixed broadband service has seen a remarkable uptick as the number
of subscribers opting for services of 300Mbps or higher continued
to grow, resulting in revenue increase."
"Regarding our three business groups, the Consumer Business
Group sustained its growth trajectory, primarily due to mobile
revenue growth driven by ongoing 5G migration and an increase in
postpaid subscribers, as well as fixed broadband revenue growth. As
a testament of our successful investment in media content, we saw
our video platform subscriptions exceeded three million in the
first week of broadcasting the Olympic Games, further expanding our
lead in the industry as the largest video platform in Taiwan. Our Enterprise Business Group's
revenue decreased due to the higher base from the large ICT project
revenue recognized last year, offset by increased IDC and
cybersecurity revenues this quarter. A noteworthy highlight is the
10 consecutive quarters of year-over-year growth in our
cybersecurity business driven by growing demand. Furthermore, we
are impressed with the performance of our International Business
Group, where revenue increased by 21.8% year-over-year, mainly
driven by overseas ICT business."
"Targeting the vast AI opportunities, we constructed AI Data
Centers, GPU Cloud, and CHT AI Factory. These efforts support
enterprise and government clients in facilitating AI
transformation. Additionally, to strategically enhance our overall
group's market value, we focused on carving out subsidiaries for
spin-offs and continuously evaluating potential M&A
opportunities. Our subsidiary, CHT Security and International
Integrated Systems Inc., will complete their listing on
Taiwan's Emerging Stock Market
Board by the second half of 2024. Looking ahead, we remain
confident that the consistent execution of our strategies will
enable us to achieve our long-term goals for superior value
creation for all our stakeholders," Mr. Kuo concluded.
Revenue
Chunghwa Telecom's total revenues for the second quarter of 2024
increased by 1.2% to NT$ 54.12
billion.
Consumer Business Group's revenue for the second quarter of 2024
increased by 2.6% YoY to NT$ 33.60
billion. Mobile service revenue increased 3.8% YoY, mainly
due to ongoing 5G migration and increase in postpaid subscriber.
Fixed broadband revenue continued to grow year over year owing to
the successful upsell of speed upgrade. Sales revenue increased
2.4% YoY mainly due to the strong sales of iPhone series. CBG's
income before tax decreased 1.6% YoY, mainly due to the increase of
personnel expenses resulting from the company's salary raises
rolled out this year
Enterprise Business Group's revenue for the second quarter of
2024 decreased 3.7% YoY to NT$ 16.89
billion, due to last year's high base from large ICT
projects and the deferral of revenue that was expected to be
recognized in the second quarter. ICT business revenue remained on
track when excluding those factors. Mobile service revenue slightly
decreased due to the higher base of prepaid card project in the
same period of last year, while 5G migration, international roaming
revenue and text message revenue continued to grow. Fixed-line
revenue slightly decreased year-over-year due to that the decline
in fixed voice revenue offset the growth of broadband access
revenue and data communication revenue. This was the main cause of
the 9.6% year-over-year decrease in EBG's income before tax.
International Business Group's revenue for the second quarter of
2024 increased by 21.8% to NT$ 2.64
billion, while its income before tax increased 8.2% YoY. The
positive growth was mainly due to overseas ICT business growth
driven by clients' global expansion.
Operating Costs and Expenses
Total operating costs and expenses for the second quarter of
2024 increased by 2.4% to NT$ 42.19
billion, mainly due to higher manpower cost and electricity
expenses.
Operating Income and Net Income
Operating income for the second quarter of 2024 decreased by
2.7% to NT$ 11.93 billion. The
operating margin was 22.0%, as compared to 22.9% in the same period
of 2023. Net income attributable to stockholders of the parent
decreased by 1.0% to NT$ 9.82
billion. Basic earnings per share was NT$1.27.
Cash Flow and EBITDA
Cash flow from operating activities, as of June 30th, 2024, increased by 3.0%
year over year to NT$ 29.32 billion,
mainly due to a rise in unearned revenue from ICT projects.
Cash and cash equivalents, as of June
30th, 2024, decreased by 24.2% to NT$ 37.71 billion as compared to that as of
June 30th, 2023.
EBITDA for the second quarter of 2024 was NT$ 21.81 billion, decreasing by 1.7% year over
year. EBITDA margin was 40.31%, as compared to 41.51% in the same
period of 2023.
Business Highlights
Mobile
As of June 30th, 2024,
Chunghwa Telecom had 13.42 million mobile subscribers, representing
a 4.5% year-over-year increase. In the second quarter, total mobile
service revenue increased by 3.5% to NT$
16.73 billion, while mobile post-paid ARPU excluding IoT
SIMs grew 2.0% year over year to NT$
556.
Fixed Broadband/HiNet
As of June 30th, 2024,
the number of broadband subscribers slightly increased by 0.6% to
4.41 million. The number of HiNet broadband subscribers increased
by 1.3% to 3.72 million. In the second quarter, total fixed
broadband revenue grew 4.4% year over year to NT$ 11.39 billion, while ARPU increased 2.0% to
NT$ 790.
Fixed line
As of June 30th, 2024,
the number of fixed-line subscribers was 9.02 million.
Financial Statements
Financial statements and additional operational
data can be found on the Company's website at
http://www.cht.com.tw/en/home/cht/investors/financials/quarterly-earnings
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) ("Chunghwa" or "the
Company") 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 with its big data, information security, cloud
computing and IDC capabilities, and is expanding its business into
innovative technology services such as IoT, AI, etc. Chunghwa has
been actively and continuously implemented environmental, social
and governance (ESG) initiatives with the goal to achieve
sustainability and has won numerous international and domestic
awards and recognitions for its ESG commitments and best practices.
For more information, please visit our website at
www.cht.com.tw
Contact: Angela Tsai
Phone: +886 2 2344 5488
Email: chtir@cht.com.tw
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SOURCE Chunghwa Telecom
