HONG KONG, Aug. 12 /PRNewswire-Asia-FirstCall/ --
Key Highlights:
-- Group total mobile customers grew 36.5 % year-on-year to approximately
11.6 million
-- Substantial increase of customer base in Indonesia to 6.4 million
-- Very positive GSM launch in Vietnam with customer acquisitions of
624,000
-- Operating profit at HK$499 million, including one-time gains of HK$236
million
-- Spin-off of Hong Kong and Macau operations released value for
shareholders
Financial Results Highlights:
Six months ended 30 June
2008 2009
HK$ HK$
millions millions
Turnover 7,991 6,411
Operating profit 1,859 499
Profit /(Loss) for the period from continuing
operations 1,684 (221)
Profit from discontinued operations 279 196
Profit/ (Loss) for the period 1,963 (25)
Profit/ (Loss) attributable to equity holders of the
Company 1,165 (285)
Basic earnings/(loss) per share attributable to
equity holders of the Company HK$0.24 HK$(0.06)
Hutchison Telecommunications International Limited ('Hutchison Telecom'; 'the Group'; 'the Company'; SEHK:2332; NYSE: HTX) today announced the financial results for the six months ended 30 June 2009 and quarterly key performance indicators ('KPIs') for the second quarter of 2009. The Group reported good progress in the emerging markets and continued to deliver sound underlying performance both operationally and financially in a challenging macro environment.
The Group's total customer base increased 36.5% to approximately 11.6 million on a like-for-like basis compared with last year, with the net gain mostly contributed by the Indonesian operation. The Israeli operation maintained its 3G customer growth momentum which drove the 3G customer base to over 1.1 million. The Group's operation in Vietnam successfully launched GSM service under the brand name Vietnamobile and started the second quarter with very positive customer acquisitions of approximately 624,000. The Group's strategy of accelerated network rollout produced results during the period. The Indonesian operation launched service in Kalimantan and Sulawesi and continued to deepen the network coverage in Java and Sumatra. The Vietnamese operation increased the number of base stations on-air to approximately 1,500 and is on track to take it to 3,000 by the end of the year.
The Group successfully spun off its Hong Kong and Macau operations in May 2009 to release value for shareholders. The combined share price of the two listed companies was over 50% higher than that of the share price of Hutchison Telecom on the day of the spin-off announcement.
Financially, the Group's first half results were adversely impacted by the depreciation of the New Israeli Shekel ('NIS') against the Hong Kong Dollar ('HKD'). Turnover decreased 19.8% to HK$6,411 million compared to HK$7,991 million in the same period last year. Excluding the impact of weaker NIS, the decrease in underlying turnover was 8.2% reflecting primarily the impact of the economic downturn. Earnings Before Interest, Tax, Depreciation and Amortisation ('EBITDA') decreased 38.9% to HK$1,117 million compared to HK$1,829 million in the same period last year. Excluding the foreign exchange impact of NIS, EBITDA for the period decreased 20.4%. This was mainly due to the ongoing network rollout in Indonesia that almost double the on-air base stations compared to last June. The loss attributable to equity holders of the Company for the period was HK$285 million.
Dennis Lui, Chief Executive Officer of Hutchison Telecom, said: "We are pleased to see a sound half year with strong growth in customers and accelerated network rollout in the Company's key operations of Indonesia and Vietnam. In face of the challenging economic conditions in the markets during the period, we continued to improve operational efficiencies and reduce costs. The Group also successfully released value for shareholders with the spin-off of its Hong Kong and Macau operations."
"We are optimistic that the momentum in Indonesia and Vietnam will carry into the remainder of 2009 and the measures taken in Sri Lanka to strengthen its competitive position will produce an improved performance in the second half," said Mr Lui.
Review of Operations
Indonesia
-- Customer base grew to 6.4 million, more than double on a yearly basis
-- Turnover increased 48.7% to HK$223 million
-- Accelerated network expansion with over 7,300 sites and services
launched in Kalimantan and Sulawesi
The Group's Indonesian operation PT. Hutchison CP Telecommunications ('HCPT') continued to expand its network footprint in the first half of 2009, along with substantial growth in customers. Against fierce competition the customer base grew 101% on a yearly basis to 6.4 million with a record 1.1 million net additions during the quarter. HCPT expanded its population coverage to approximately 70%, covering Kalimantan and Sulawesi and with services launched in new major cities. The operation is on track to increase its network to 9,000 base stations on-air with a population coverage of over 75% by the end of 2009.
HCPT's turnover for the first half of 2009 increased 48.7% to HK$223 million. However, as the network expanded so the network operating costs became higher. Its Loss Before Interest, Taxation, Depreciation and Amortisation ('LBITDA') for the first six months of 2009 increased to HK$764 million, compared to HK$348 million in the same period last year.
HCPT reported stable KPIs compared with the previous quarter. Prepaid Average Revenue Per User ('ARPU') increased modestly to IDR10,316 from IDR9,963 in the previous quarter. During the first half year, as a result of the reduction in promotional on-net minutes offered, blended Minutes of Use ('MOU') stood at 55 minutes, same as the previous quarter. Blended churn remained high at 24.9%.
Israel
-- Continued to deliver very satisfactory financial results; operating
profit was HK$1,473 million
-- Customer base rose to approximately 2,944,000 with double digit growth
year-on-year in 3G base surpassing 1.1 million
The 3G customer growth momentum of Partner Communications Company Ltd. ('Partner') was maintained in the first half of 2009, adding 81,000 to 1,102,000 during the quarter, increasing 7.9% quarterly and 32.1% year-on-year.
With the impact of the foreign exchange movement, Partner reported a decrease in turnover by 19.7% year-on-year to HK$5,610 million for the first six months of 2009. EBITDA decreased 11.7% to HK$2,093 million compared to HK$2,369 million in the same period last year. Excluding the NIS foreign exchange impact, the underlying turnover decreased 6.6% and the underlying EBITDA was comparable with the same period last year. This was due to lower roaming activity and, following the Ministry of Communications' mandate of the reduction from 1 January 2009 of the billing interval from 12 seconds to single second, lower voice revenues. The negative impacts on revenues were however partially offset by the 9.8% growth in SMS, content and data services in NIS terms compared to the same period last year.
On the back of an increase in MOU and non-voice revenue, ARPU increased 4.1% to NIS151 in the second quarter. Churn improved to 1.3% from 1.6% in the first quarter and remained stable when compared to the same quarter last year.
Vietnam
-- Very positive growth rate with a GSM customer base of approximately
624,000
-- Increased base stations to approximately 1,500 in June with
approximately 65% population coverage
-- Target to have 3,000 base stations on-air by end of 2009
The Group's Vietnamese operation Vietnamobile recorded very positive first quarter results since the launch of GSM service in the second quarter of 2009. The operation acquired approximately 624,000 customers mostly in the prepaid segment. ARPU was at VND68,000 and MOU were initially high at 221 minutes due to short term promotions that allowed a high volume of on-net minutes. To date, over 1,800 base stations are on-air with 65% population coverage. LBITDA was HK$125 million in the first half of 2009 and the operating loss for the period was HK$141 million.
Sri Lanka
-- Continue network expansion to increase population coverage to 65% by
end of 2009
The first half of 2009 still saw the performance of Hutchison Telecommunications Lanka (Private) Limited severely hampered by adverse economic conditions and fierce competition. Customers declined significantly and the operation turned from EBITDA positive in the same period last year into a LBITDA of HK$39 million for the first six months of 2009. The operation's customer base at the end of the quarter stood at 536,000 and will continue its network expansion to reach 800 sites and population coverage to 65% by the end of 2009.
Thailand
The Group remains in discussion about a potential exit for its Thailand operation with CAT Telecom Public Company Limited and has decided to exclude the KPIs of its Thailand operation in the quarterly announcement starting from this quarter.
Outlook
While the signs of any recovery in the global economy in the second quarter are unclear, the Group remains optimistic about the second half. The performance of the Group's Indonesian and Vietnamese operations in the first half has been above its expectation and both operations will continue to focus on customer growth, accelerate network rollout and increase market share penetration in the second half of the year.
About Hutchison Telecommunications International Limited
Hutchison Telecommunications International Limited ('Hutchison Telecom' or 'the Group') is a leading provider of telecommunications services. The Group currently offers mobile and fixed-line telecommunications services in Israel, and operates mobile telecommunications services in Indonesia, Vietnam, Sri Lanka and Thailand. It was the first provider of 3G mobile services in Israel. Its brands include "Hutch", "3" and "Orange".
Hutchison Telecom is a listed company with American Depositary Shares quoted on the New York Stock Exchange under the ticker HTX and shares listed on the Stock Exchange of Hong Kong under the stock code 2332. A member of the Hong Kong-based Hutchison Whampoa Group, Hutchison Telecom is committed to providing superior telecommunications services in dynamic markets. For more information about Hutchison Telecom, see http://www.htil.com .
Cautionary Statements
This press release contains forward-looking statements. Statements that are not historical facts, including statements about the beliefs and expectations of Hutchison Telecommunications International Limited ('the Company'), are forward-looking statements. These statements are based on current plans, estimates and projections, and therefore you should not place undue reliance on them. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events. Forward-looking statements involve inherent risks, uncertainties and assumptions. The Company cautions you that if these risks or uncertainties ever materialise or the assumptions prove incorrect, or if a number of important factors occur or do not occur, the Company's actual results may differ materially from those expressed or implied in any forward-looking statement. Additional information as to factors that may cause actual results to differ materially from the Company's forward-looking statements can be found in the Company's filings with the United States Securities and Exchange Commission.
- Financial Tables to Follow -
Unaudited Key Performance Indicators for Second Quarter 2009
Customer Base Q2 2009 Q1 2009
30 June 2009 31 March 2009
Total Postpaid Prepaid Total Postpaid Prepaid
Market ('000) ('000) ('000) ('000) ('000) ('000)
Indonesia 6,434 12 6,422 5,305 12 5,293
Israel 2,944 2,174 770 2,903 2,159 744
Sri Lanka 536 -- 536 722 -- 722
Vietnam 624 1 623 -- -- --
Customer Base Q4 2008 Q3 2008
(Continued) 31 December 2008 30 September 2008
Total Postpaid Prepaid Total Postpaid Prepaid
Market ('000) ('000) ('000) ('000) ('000) ('000)
Indonesia 4,501 11 4,490 3,604 9 3,595
Israel 2,898 2,153 745 2,882 2,145 737
Sri Lanka 887 -- 887 958 -- 958
Vietnam -- -- -- -- -- --
Customer Base Q2 2008
(Continued) 30 June 2008
Total Postpaid Prepaid
Market ('000) ('000) ('000)
Indonesia 3,203 7 3,196
Israel 2,856 2,135 721
Sri Lanka 1,291 -- 1,291
Vietnam -- -- --
Notes:
(1) A customer is defined as a Postpaid Customer or a Prepaid Customer
who has a Subscriber Identity Module (SIM) or Universal Subscriber
Identity Module (USIM) that has access to the network for any purpose,
including voice, data or video services.
(2) Postpaid Customers are defined as those whose mobile
telecommunications service usage is paid in arrears upon receipt of
the mobile telecommunications operator's invoice and who have not been
temporarily or permanently suspended from service.
(3) Prepaid Customers are defined as customers with prepaid SIM cards or
prepaid USIM cards that have been activated but not been used up or
expired at period end.
A new prepaid customer is recognised upon making the first call or
registration/activation.
(4) All numbers quoted on the basis of the total customer base of the
operation irrespective of the Company's ownership percentage.
(5) All numbers quoted as at last day of the quarter.
(6) The data for Israel relate to both 2G and 3G services.
(7) The data for Hong Kong (incl Macau), Ghana and Thailand are excluded.
ARPU(1) Q2 2009 Q1 2009
30 June 2009 31 March 2009
Market Currency Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia IDR('000) 11 202 10 10 183 10
Israel NIS 151 -- -- 145 -- --
Sri Lanka LKR 119 -- 119 148 -- 148
Vietnam VND('000) 68 250 68 -- -- --
ARPU(1) (Continued) Q4 2008 Q3 2008
31 December 2008 30 September 2008
Market Currency Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia IDR('000) 11 134 11 10 134 9
Israel NIS 158 -- -- 166 -- --
Sri Lanka LKR 164 -- 164 181 -- 181
Vietnam VND('000) -- -- -- -- -- --
ARPU(1) (Continued) Q2 2008
30 June 2008
Market Currency Blended Postpaid Prepaid
Indonesia IDR('000) 12 108 12
Israel NIS 158 -- --
Sri Lanka LKR 163 -- 163
Vietnam VND('000) -- -- --
Notes:
(1) The monthly Average Revenue Per User (ARPU) is calculated as the
total Service Revenues for the month divided by the simple average
number of activated customers for the month.
The monthly ARPU for the quarter represents the average of the
monthly ARPU in the quarter.
(2) Service Revenues are defined as the direct recurring service
revenues plus roaming revenues.
(3) The data for Israel relate to both 2G and 3G services.
(4) The data for Hong Kong (incl Macau), Ghana and Thailand are
excluded.
MOU(1) Q2 2009 Q1 2009
30 June 2009 31 March 2009
Market Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia 55 375 54 55 342 55
Israel 364 -- -- 358 -- --
Sri Lanka 77 -- 77 77 -- 77
Vietnam 221 156 221 -- -- --
MOU (1) (Continued) Q4 2008 Q3 2008
31 December 2008 30 September 2008
Market Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia 55 225 55 56 209 56
Israel 357 -- -- 376 -- --
Sri Lanka 74 -- 74 71 -- 71
Vietnam -- -- -- -- -- --
MOU (1) (Continued) Q2 2008
30 June 2008
Market Blended Postpaid Prepaid
Indonesia 82 117 82
Israel 368 -- --
Sri Lanka 54 -- 54
Vietnam -- -- --
Notes:
(1) The monthly Minutes of Use (MOU) is calculated as the total minutes
carried over the network (2G total airtime usage + 3G voice and video
usage, but excluding inbound on-net minutes) for the month divided by
the simple average number of activated customer. The monthly MOU for
the quarter represents the average of the monthly MOU in the quarter
(2) The data for Israel relate to both 2G and 3G services.
(3) The data for Hong Kong (incl Macau), Ghana and Thailand are excluded.
Churn (1) Q2 2009 Q1 2009
30 June 2009 31 March 2009
Market Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia 24.9% 12.8% 25.0% 24.8% 4.8% 24.9%
Israel 1.3% -- -- 1.6% -- --
Sri Lanka 10.8% -- 10.8% 7.1% -- 7.1%
Vietnam 0.3% 10.6% 0.3% -- -- --
Churn (1) (Continued) Q4 2008 Q3 2008
31 December 2008 30 September 2008
Market Blended Postpaid Prepaid Blended Postpaid Prepaid
Indonesia 24.2% 4.1% 24.3% 18.1% 5.3% 18.1%
Israel 1.5% -- -- 1.3% -- --
Sri Lanka 4.4% -- 4.4% 5.0% -- 5.0%
Vietnam -- -- -- -- -- --
Churn (1) (Continued) Q2 2008
30 June 2008
Market Blended Postpaid Prepaid
Indonesia 15.6% 7.9% 15.6%
Israel 1.3% -- --
Sri Lanka 3.8% -- 3.8%
Vietnam -- -- --
Notes:
(1) The monthly churn % is calculated as the average number of
disconnections (net of reconnection and internal migration between
networks) for the month divided by the simple average number of
activated customers for the month. The monthly churn % for the quarter
represents the average of the monthly churn rates in the quarter.
(2) The data for Israel relate to both 2G and 3G services.
(3) The data for Hong Kong (incl Macau), Ghana and Thailand are excluded.
The Board wishes to remind investors that the above key performance indicators are based on the Group's unaudited internal records. Investors are cautioned not to unduly rely on such data.
For enquiries, please contact:
Ada Yeung
Corporate Communications
Hutchison Telecom
Tel: +852-2128-3106
Mobile: +852-6347-0619
Email: adayeung@htil.com.hk
