PCCW(00008)2024-09-05 04:14User Growth and Engagement - Viu achieved a milestone of 11.7 million paid users as of June 30, 2024, with over 110 new titles added during the period, driving subscriber growth[14] - ViuTV's digital membership increased by 6% to 3.2 million, driven by engaging content and unique productions[16] - Viu's paid user base reached 11.7 million, adding over 110 new titles[50] - Viu's paid user base reached 11.7 million, an 11% year-on-year increase, with significant growth in Indonesia, Thailand, and the Middle East[61] Financial Performance - For the six months ending June 30, 2024, the company reported a revenue growth of 5% and EBITDA growth of 1% due to increased contributions from its media business and cost efficiencies[19] - Revenue increased by 5% to HKD 17.698 billion[50] - Total revenue for the six months ended June 30, 2024, was HKD 17,698 million, an increase of 5.0% compared to HKD 16,850 million in 2023[110] - The media business generated external revenue of HKD 1,325 million for the six months ended June 30, 2024, up from HKD 1,146 million in the prior year, marking a growth of around 15.7%[110] - The net profit for the six months ended June 30, 2024, decreased to HKD 351 million, down 31.4% from HKD 512 million in 2023[89] Revenue Breakdown - Hong Kong telecommunications revenue (excluding mobile product sales) rose by 3% to HKD 15.683 billion[50] - OTT business revenue increased by 12% to HKD 1.089 billion[50] - Free TV and related business revenue rose by 23% to HKD 480 million[50] - Mobile communication service revenue grew by 5% to HKD 3,990 million, driven by increased roaming revenue and a net increase in postpaid customers[55] - The external revenue from Hong Kong Telecommunications segment was HKD 16,000 million for the six months ended June 30, 2024, compared to HKD 15,335 million in the same period of 2023, reflecting an increase of approximately 4.3%[110] Cost and Expenses - The cost of sales for the same period rose to HKD 8,939 million, reflecting a 7.8% increase from HKD 8,292 million in 2023[89] - The group's operating costs rose by 5% to HKD 30.87 billion, primarily due to increased promotional costs for OTT services aimed at boosting market penetration and paid subscriptions[70] - The total sales cost, excluding the cost of goods sold, rose slightly from HKD 5,739 million in 2023 to HKD 5,776 million in 2024, an increase of 0.6%[113] EBITDA and Profitability - EBITDA increased by 1% to HKD 5.672 billion[50] - EBITDA for the six months ended June 30, 2024, rose by 3% to HKD 6.168 billion, with an EBITDA margin stable at 37%[58] - The EBITDA for Hong Kong Telecom was HKD 6,009 million, with an EBITDA margin of 37%[54] - The company experienced a 10% increase in operating profit, amounting to HKD 1,824 million[51] Dividends and Shareholder Returns - The board declared an interim dividend of HKD 0.0977 per ordinary share for the six months ending June 30, 2024, reflecting a cautious dividend policy aimed at strengthening financial stability[19] - The interim dividend declared for the six months ended June 30, 2024, is HKD 0.0977 per share, unchanged from the previous year[87] Debt and Financing - The total debt as of June 30, 2024, was HKD 563.84 billion, up from HKD 523.29 billion as of December 31, 2023, with a debt-to-asset ratio of 59%[79] - Interest income for the six months ended June 30, 2024, was HKD 68 million, while financing costs rose by 21% to HKD 13.90 billion, leading to a net financing cost increase of 24% to HKD 13.22 billion[73] - The financing costs increased to HKD 1,390 million for the six months ended June 30, 2024, from HKD 1,153 million in the same period of 2023, representing an increase of approximately 20.6%[111] Operational Strategy and Future Outlook - The company is focused on prudent expansion in the video streaming and local television sectors, leveraging the robust foundation of Hong Kong Telecom to drive profit growth[13] - The company plans to continue leveraging its integrated fiber and mobile networks to provide innovative service solutions amid a challenging business environment[54] - The company plans to continue investing in enhancing digital capabilities and expanding the 5G network, considering current market conditions[81] Management and Governance - 唐永博 appointed as Vice Chairman of PCCW in August 2023, bringing extensive telecommunications management experience[29] - Meng Shusen serves as a non-executive director and is currently the Chairman and CEO of China Unicom International, with a strong background in international business[31] - Wei Zhe has over 20 years of experience in investment and operations management, previously serving as CEO of Alibaba Group during its IPO in 2007[32] Share Incentive Plans - The company plans to continue its share incentive program to align the interests of participants with those of shareholders[177] - The share incentive plan includes vesting periods ranging from 1 to 4 years, promoting long-term commitment from participants[177] - The total number of shares awarded under the 2020 plan is 6,141,746 shares, with 3,895,874 shares that have vested[178]