Hutch Expands, Appoints, Profits

Hutchison discusses expansion opportunities with Essar in India; appoints executive director and CEO; reports operating profit up 297.6% to HK$1B

August 3, 2005

4 Min Read

HONG KONG -- Hutchison Telecommunication International Limited ("Hutchison Telecom", "the Company"; HKG: 2332; NYSE: HTX) today announced that it and Essar Teleholdings Limited ("Essar") are in discussions regarding possible expansion opportunities in India.

The parties have been exploring ways for Hutchison Max Telecom Limited ("HMTL"), their joint venture in India, to acquire the operating subsidiaries of BPL Communications Limited being BPL Mobile, which operates in Mumbai, and BPL Cellular, which operates in Maharashtra, Tamil Nadu and Kerala.

In addition, the parties are in advanced discussions for HMTL to acquire Essar Spacetel Limited, which has applied for seven new licences. The licences are for Madhya Pradesh, North East, Himachal Pradesh, Bihar, Orissa, Assam and, Jammu and Kashmir. No definitive agreements have been entered into regarding the above, which if reached, are expected to be subject to applicable regulatory approvals.

In a separate release:

HONG KONG -- Hutchison Telecommunication International Limited ("Hutchison Telecom", "the Company"; HKG: 2332; NYSE: HTX) today announced management appointments to further drive development of its mobile business in high-growth emerging markets and to extend its market leadership position in Hong Kong.

Agnes Nardi will be appointed to the Hutchison Telecom board of directors as an Executive Director. She joins the Company from Hutchison Telecom Hong Kong ("HTHK") where she was Managing Director of the mobile business.

Peter Wong, Chief Executive Officer of the Company's Hong Kong fixed line business, Hutchison Global Communications ("HGC"), will assume the additional responsibility of CEO of HTHK.

The appointments take place with immediate effect.

Dennis Lui, Chief Executive Officer of Hutchison Telecom, said: "I am delighted that Agnes and Peter will bring their considerable talent, experience and energy to continue the drive to develop our business as the leading provider of telecommunication services in Asia and other developing markets."

In a separate release:

HONG KONG, Aug. 3 /Xinhua-PRNewswire/ -- Hutchison Telecommunications International Limited ("Hutchison Telecom", the "Company" or the "Group"; SEHK: 2332; NYSE: HTX) today announced strong growth in the Group's results for the six months ended 30 June 2005.

The Group's underlying operating profit before disposal of investments and others reached HK$1,014 million, a 297.6% increase compared with the first half of 2004, boosted by strong operating results in India and Israel and a reduction of losses in Thailand.

All markets reported growth in customer base, which rose overall by 30.9% to 14.1 million. The vigorous growth in worldwide customer base fuelled the surge in the Group's turnover to HK$10,757 million, an increase of 56.1% compared with the same period a year earlier. During the first half we consolidated our Israel subsidiary, Partner Communications Company Ltd. ("Partner") for the first time. Excluding the impact of the consolidation of Partner, turnover growth was 25.4%.

EBITDA increased 84.8% to HK$2,831 million and EBITDA margins improved to 26.3% from 22.2%. The Group recorded a loss attributable to equity holders of the Company of HK$352 million, or HK$0.08 loss per share, after it took a net loss on disposal of investments and others of HK$295 million, finance costs of HK$612 million and a taxation charge of about HK$318 million.

During the first half of 2005, the Group strengthened its operations with a number of key strategic initiatives to build Hutchison Telecom into a leading provider of telecommunications services in Asia and developing markets elsewhere. These included expansion into Indonesia and Vietnam; reorganisation of the Indian operations; increasing ownership in existing operations in Israel and in the Hong Kong fixed-line business; and the sale of the operations in Paraguay.

The Group is now well-positioned in its markets and today we also announce changes in senior management to capitalise on these opportunities. Peter Wong, Chief Executive Officer of Hutchison Global Communications Holdings Ltd ("HGCH"), will assume responsibility for both the fixed-line and mobile businesses in Hong Kong, whilst Agnes Nardi will take up the new position of Executive Director, to help drive growth opportunities in our developing markets.

Dennis Lui, Chief Executive Officer, Hutchison Telecom, said: "Our focused strategy of investing for growth is clearly reflected in our excellent performance in the first half. I am particularly pleased to see satisfying operational momentum in our key markets of India and Israel."

Mr Lui added: "Going forward, we will continue to drive our strategy of expanding in emerging mobile markets with high growth potential, such as India, Vietnam and Indonesia, while maintaining our leading position in Hong Kong's mobile and fixed-line markets." Tim Pennington, Chief Financial Officer, Hutchison Telecom, said: "Our revenue and profit growth demonstrates the strength of our operations. We will continue to strengthen our competitive position with further investment in growth markets, while continuing to drive initiatives to control costs to further enhance financial performance and organisational efficiency."

Hutchison Telecommunications (Hong Kong) Ltd.

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