China Tower makes 2.9b yuan

Business | Avery Chen 12 Aug 2020

China Tower (0788) said its first-half net profit rose 16.9 percent year-on-year to 2.98 billion yuan (HK$3.32 billion), without declaring an interim dividend, while chairman Tong Jilu said the Sino-US trade war will have a limited impact on its business.

The mobile telecommunications tower operator posted a 4.6 percent rise in earnings before interest, taxes, depreciation and amortization to 29.1 billion yuan for the first six months of this year. Earnings per share were 1.7 fen.

Its operating revenue for the first six months rose 4.8 percent to 39.79 billion yuan.

But revenue growth of its tower business, which contributes over 70 percent of total revenue, slowed to 1.6 percent in the first half compared with a 5.1 percent increase in the same period in 2019.

This was due to some installation work and rental agreements being delayed due to the Covid-19 pandemic, and around 97 percent of 5G site construction projects were based on existing resources, Tong said. He projected that revenue from tower business will grow significantly in the second half, driven by increasing demand for 5G constructions.

Chief accountant Gao Chunlei said the group plans to maintain a similar level of capital expenditure for the second half.

In the first half, China Tower's capital expenditure reached 14.30 billion yuan, up more than 60 percent from a year ago.

China Tower managed 2.02 million tower sites as of end-June, up 21,000 from the end of 2019. The number of telecommunications tenants rose by 61,000 to 3.12 million compared to the end of 2019.

Shares of China Tower fell 3.31 percent to HK$1.46 yesterday.

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