HKBN sees green shoots in sea of red

First-half profit and large enterprise order book are signs of turnaround, says Hong Kong telco HKBN.

Robert Clark, Contributing Editor, Special to Light Reading

May 2, 2024

2 Min Read
Hong Kong buildings

HKBN's first half was saturated in red ink, but the Hong Kong telco says the business has begun turning around.

CFO Derek Yue said the small profit was an improvement over last year's full-year loss. "The trend and the trajectory of improvement has been seen," he told an earnings briefing.

The company is betting on its new 25Gbit/s broadband service and the conversion of its enterprise order backlog as prime growth drivers in the next year. The interim numbers make for gloomy reading once more for investors, with net profit down 93% and revenue, EBITDA (earnings before interest, taxes, depreciation and amortization) and cashflow all declining.

The market immediately marked the stock down another 16%, and although it has since recovered slightly, it is 30% below its level at the start of the year and 82% lower than five years ago.

Net income was 1.5 million Hong Kong dollars (US$191,880), with EBITDA HK$1.15 billion ($147 million), off 4%.

Capex down a third

Revenue fell 13% to HK$5.8 billion ($741.9 million), with lower sales in every segment – enterprise solutions, enterprise products, residential and consumer hardware. The biggest decline was in the handset segment, which sunk 36% as customers postponed their upgrades.

Yue said higher interest rates had also taken their toll, with borrowing costs up HK$124 million ($15.9 million) and free cash flow down 66%. In these conditions, the company carried out some energetic cost-cutting, slashing capex by a third and network costs by 18%. It also cut headcount by 14%.

HKBN had grown its business through its citywide fiber rollout but is now transitioning to full ICT provider. 

After rolling up several competitors the enterprise services and products segments are now HKBN's major business, contributing 56% of revenue in the first half. The company said enterprise order bookings were up 20%, with a revenue backlog reaching HK$4.7 billion.

CEO William Yeung said it is also looking to its 25Gbit/s home broadband service, the first in Hong Kong, to drive ARPU growth.

"We are very upbeat on our outlook. Basically we believe revenue, EBITDA and adjusted free cashflow will all improve because of the strong fundamentals," he said.

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About the Author(s)

Robert Clark

Contributing Editor, Special to Light Reading

Robert Clark is an independent technology editor and researcher based in Hong Kong. In addition to contributing to Light Reading, he also has his own blog,  Electric Speech ( 

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