China Telecom Reports Q3

Operating revenue was RMB44,945 million

October 22, 2008

2 Min Read

SHENZHEN, China -- For the third quarter of 2008, despite facing the challenges from the intense market competition and the increased diversity in communication means, the Group had successfully maintained its solid fundamentals. The Group grasped the opportunities brought by informatisation to tackle various challenges, and promoted the scale development of transformation businesses to drive revenue growth. Additionally, capitalizing on the customer brands operation and effective packaged sales of voice and transformation businesses, the Group endeavored to foster customer loyalty and mitigate the loss in voice revenue, progressively transforming voice usage value to integrated information services.

Due to the intense market competition, the Group continued to record negative growth in its local access lines in service for the third quarter. The Group emphasized the principle of profitable development of its voice business. The Group concentrated its sales resources and tilted its resource allocation towards the key customer segments of government and enterprise as well as mid-to-high-end household while strictly controlling sales initiatives for the low-end customers. Businesses like Internet and data services, value-added and integrated information application services continued its robust growth momentum. The broadband subscribers reached 42.18 million, representing a net increase of 2.23 million. Excluding the amortization of upfront connection fees of RMB497 million, operating revenues for the third quarter of 2008 was RMB44,945 million, representing an increase of 0.7% over the corresponding period of last year. The profit attributable to equity holders of the Company reached RMB5,624 million, representing an increase of 1.3% over the corresponding period of last year. EBITDA was RMB21,893 million, representing a decrease of 1.9% over the corresponding period of last year. EBITDA margin was 48.7%, sustained at a relatively high level. Due to the impact from the unexpected serious natural disasters such as snowstorms and earthquake in the first half of this year, the overall EBITDA and profit attributable to equity holders of the Group in the first three quarters of 2008 decreased by 1.9% and 2.3% respectively over the corresponding period of last year.

Following the approval by shareholders' meeting, on 1 October, the Group has commenced the completion of the CDMA business acquisition, and also launched the mobile services operation by leasing the CDMA network assets acquired by our parent company. The Group will leverage transformation to drive full services offering. We aim to effectively converge the mobile elements with the integrated information services and implement differentiation development strategy with a focus on mid-to-high-end urban customers. Taking advantage of our customer resources, direct sales channels and multi-service operations,we will incorporate mobile elements into the brand operations to provide our customers with differentiated integrated information services based on Mobile Internet and Fixed-Mobile Convergence (FMC), to further enhance our core competitiveness. China Telecom would strive to achieve a thriving future and create more value for our shareholders.

China Telecom USA

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