TAIPEI, Nov. 2, 2023
/PRNewswire/ -- Chunghwa Telecom Co., Ltd. (TAIEX: 2412, NYSE: CHT)
("Chunghwa" or "the Company") today reported its un-audited
operating results for the third quarter of 2023. All figures
were prepared in accordance with Taiwan-International Financial
Reporting Standards ("T-IFRSs") on a consolidated basis.
(Comparisons throughout the press release, unless otherwise
stated, are made with regard to the prior year
period.)
Third Quarter 2023 Financial Highlights
- Total revenue increased by
0.3% to NT$ 53.66 billion.
- Consumer Business Group
revenue increased by 2.8% to NT$ 33.74
billion.
- Enterprise Business Group
revenue decreased by 4.4% to NT$ 16.62
billion.
- International Business
Group revenue increased by 29.8% to NT$ 2.34
billion.
- Total operating costs and
expenses increased by 2.1% to NT$ 42.19
billion.
- Operating income decreased
by 5.9% to NT$ 11.46 billion.
- EBITDA decreased by 3.3%
to NT$ 21.38 billion.
- Net income attributable to
stockholders of the parent decreased by 2.9% to NT$ 9.09 billion.
- Basic earnings per share
(EPS) was NT$1.18.
- EPS and net income aligned
with our expectation.
"We had another sound quarter with results exhibiting healthy
momentum in various parts of our business," said Mr. Shui-Yi, Kuo,
Chairman and Chief Executive Officer of Chunghwa Telecom. "While
the higher base during the same period last year resulted in a
relative decrease in our performance in the third quarter, we
remain confident in our fundamentals and thereby the long-term
sustainable growth of Chunghwa. We reported resilient performance
across many business segments; for Consumer Business Group, our
mobile business revenue increased 6.9% YoY, maintaining its growth
for 30 consecutive months, while we observed an average 44% uplift
in mobile monthly fees for 4G to 5G migrators. Meanwhile, our
mobile market share in Taiwan kept
growing QoQ and reached 40% in terms of revenue and 37.1% in the
number of subscribers, widening our lead against our peers.
Moreover, our promotion packages of fixed broadband business drove
steady progress in terms of subscribers and ARPU(Average Revenue
Per User). Although our Enterprise Business Group revenue was
heavily impacted by the decline in fixed voice business from
enterprise clients following the pandemic, we are glad to see
revenues of cybersecurity and IDC business from emerging enterprise
applications continued to grow due to increasing demands, in line
with our expectation. The total revenue of International Business
Group delivered a double-digit growth year over year. Furthermore,
we have expanded our footprint globally as we signed
MOUs(memorandum of understanding)with EXATEL, a telco from
Poland and Overbrook Hospital in
Thailand, respectively, aiming to
replicate our success in Taiwan to
global markets."
"During this quarter, Chunghwa Telecom actively invested in KK
Company Technologies to further expand our digital ecosystem for
innovative business models, which enable us to serve our customers
with better video quality," said Mr. Chau-Young, Lin, President of
Chunghwa Telecom. "In addition, we were ahead of our peers
and announced to raise funds to enhance
content business and expect to build the content ecosystem.
At the same time, we aim to collaborate with domestic and
international content creators to strengthen our IPTV(Internet
Protocol Television)and OTT(Over-the-top)services."
"At Chunghwa, we continue advancing toward being an
international benchmark enterprise recognized for sustainable development,
leading the way as a digital ecosystem enabler, and empowering
stakeholders to drive innovation and create value to meet the
evolving needs of our customers and the world, while expanding our
international business and operations to drive growth," Mr.
Shui-Yi, Kuo concluded.
Revenue
Chunghwa Telecom's total revenues for the third quarter of 2023
increased by 0.3% to NT$ 53.66
billion.
Consumer Business Group's total revenue increased by 2.8% to
NT$ 33.74 billion. Mobile service
revenue increased 6.8% YoY, mainly due to stable 5G migration and
increase in postpaid subscriber growth. In addition, international
roaming revenue continued to recover and brought in contribution.
Fixed-line service revenue decreased 0.7% YoY due to voice decline,
while the fixed broadband revenue grew by 2.7% year over year
driven by effective promotion. Sales revenue increased 3% YoY
propelled by the increase in sales volume of iPhone 15 series.
However, CBG's income before tax for the third quarter of 2023
remained flat owing to the higher base of recognition of government
subsidies in the same period last year, as well as the increase of
manpower and electricity expenses and the purchase of renewable
energy.
Enterprise Business Group's income before tax for the third
quarter of 2023 decreased 11.8% YoY, while revenue decreased by
4.4% to NT$ 16.62 billion, mainly due
to the decrease of fixed voice and a higher base of recognition of
government subsidies in the same period last year. Despite ICT
revenue decrease in the third quarter because of a higher base
of a recognition of large smart energy projects, mobile service
revenue increased attributable to 5G upselling and the recovery of
international roaming revenue. Fixed-line revenue slightly
decreased year-over-year mainly due to voice decline, although data
communication revenue and broadband access revenue continued to
grow as expected.
International Business Group's income before tax for the third
quarter of 2023 decreased 3.6% YoY owing to non-operating expenses,
such as the foreign currency valuation loss, and the increase of
electricity expenses. Excluding the impact, IBG continued to
experience positive YoY growth in profit. Total revenue increased
by 29.8% to NT$ 2.34 billion, mainly
driven by the growing emerging business, including IDC and cloud
services from global clients, and recovered roaming revenue.
Operating Costs and Expenses
Total operating costs and expenses for the third quarter of 2023
increased by 2.1% to NT$ 42.19
billion, mainly due to higher electricity expenses and
manpower cost.
Operating Income and Net Income
Income from operations for the third quarter of 2023 decreased
by 5.9% to NT$ 11.46 billion. The
operating margin was 21.4%, as compared to 22.8% in the same period
of 2022. Net income attributable to stockholders of the parent
decreased by 2.9% to NT$ 9.09
billion. Basic earnings per share was NT$1.18.
Cash Flow and EBITDA
Cash flow from operating activities, as of September 30th, 2023, increased by
5.7% year over year to NT$ 49.89
billion.
Cash and cash equivalents, as of September 30th, 2023, decreased by
2.7% to NT$ 32.01 billion as compared
to that as of September
30th, 2022.
EBITDA for the third quarter of 2023 was NT$ 21.38 billion, decreasing by 3.3% year over
year. EBITDA margin was 39.84%, as compared to 41.30% in the same
period of 2022.
Business Highlights
Mobile
As of September 30th,
2023, Chunghwa Telecom had 12.93 million mobile subscribers,
representing a 4.1% year-over-year increase. In the third quarter,
total mobile service revenue increased by 6.9% year-over-year to
NT$ 16.42 billion, while mobile
post-paid ARPU excluding IoT SIMs grew 5.1% year over year to
NT$ 553.
Fixed Broadband/HiNet
As of September 30th,
2023, the number of broadband subscribers slightly increased by
0.1% to 4.39 million. The number of HiNet broadband subscribers
increased by 0.7% to 3.68 million. In the third quarter, total
fixed broadband revenue grew 1.9% year over year to NT$ 10.95 billion, while ARPU increased 1.0% to
NT$ 775.
Fixed line
As of September 30th,
2023, the number of fixed-line subscribers was 9.21 million.
Financial Statements
Financial statements and additional operational data can be
found on the Company's website
at http://www.cht.com.tw/en/home/cht/investors/financials/quarterly-earnings
NOTE CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements. These
statements constitute "forward-looking" statements within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and as defined in the U.S. Private Securities Litigation Reform Act
of 1995. These forward-looking statements can be identified by
terminology such as "will," "expects," "anticipates," "future,"
"intends," "plans," "believes," "estimates" and similar statements.
Statements that are not historical facts, including statements
about Chunghwa's beliefs and expectations, are forward-looking
statements. Forward-looking statements involve inherent risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements. A number of important factors
could cause actual results to differ materially from those
contained in any forward-looking statement. Investors are cautioned
that actual events and results could differ materially from those
statements as a result of a number of factors including, but not
limited to the risks outlined in Chunghwa's filings with the U.S.
Securities and Exchange Commission on Forms F-1, F-3, 6-K and 20-F,
in each case as amended. The forward-looking statements in this
press release reflect the current belief of Chunghwa as of the date
of this press release and Chunghwa undertakes no obligation to
update these forward-looking statements for events or circumstances
that occur subsequent to such date, except as required under
applicable law.
This press release is not an offer of securities for sale in
the United States. Securities may
not be offered or sold in the United
States absent registration or an exemption from
registration. Any public offering of securities to be made in
the United States will be made by
means of a prospectus that may be obtained from the issuer or
selling security holder and that will contain detailed information
about the company and management, as well as financial
statements.
NON-GAAP FINANCIAL MEASURES
To supplement the Company's consolidated financial statements
presented in accordance with International Financial Reporting
Standards pursuant to the requirements of the Financial Supervisory
Commission, or T-IFRSs, Chunghwa Telecom also provides EBITDA,
which is a "non-GAAP financial measure". EBITDA is defined as
consolidated net income excluding (i) depreciation and
amortization, (ii) certain financing costs, (iii) other expenses or
income not related to the operation of the business, (iv) income
tax, (v) (income) loss from discontinued operations.
In managing the Company's business, Chunghwa Telecom relies on
EBITDA as a means of assessing its operating performance because it
excludes the effect of (i) depreciation and amortization, which
represents a non-cash charge to earnings, (ii) certain financing
costs, which are significantly affected by external factors,
including interest rates, foreign currency exchange rates and
inflation rates, which have little or no bearing on our operating
performance, (iii) other expenses or income not related to the
operation of the business, (iv) income tax, (v) (income) loss from
discontinued operations.
CAUTIONS ON USE OF NON-GAAP FINANCIAL MEASURES
In addition to the consolidated financial results prepared under
T-IFRSs, Chunghwa Telecom also provide non-GAAP financial
measures, including "EBITDA". The Company believes that
the non-GAAP financial measures provide investors with another
method for assessing its operating results in a manner that is
focused on the performance of its ongoing operations.
Chunghwa Telecom's management believes investors will benefit
from greater transparency in referring to these non-GAAP financial
measures when assessing the Company's operating results, as well as
when forecasting and analyzing future periods. However, the
Company recognizes that:
- these non-GAAP financial measures are limited in their
usefulness and should be considered only as a supplement to the
Company's T-IFRSs financial measures;
- these non-GAAP financial measures should not be considered in
isolation from, or as a substitute for, the Company's T-IFRSs
financial measures;
- these non-GAAP financial measures should not be considered to
be superior to the Company's T-IFRSs financial measures;
and
- these non-GAAP financial measures were not prepared in
accordance with T-IFRSs and investors should not assume that
the non-GAAP financial measures presented in this earnings release
were prepared under a comprehensive set of rules or principle.
Further, these non-GAAP financial measures may be unique to
Chunghwa Telecom, as they may be different from non-GAAP financial
measures used by other companies. As such, this presentation of
non-GAAP financial measures may not enhance the comparability of
the Company's results to the results of other companies.
Readers are cautioned not to view non-GAAP results as a substitute
for results under T-IFRSs, or as being comparable to results
reported or forecasted by other companies.
About Chunghwa Telecom
Chunghwa Telecom (TAIEX 2412, NYSE: CHT) ("Chunghwa" or "the
Company") is Taiwan's largest
integrated telecommunications services company that provides
fixed-line, mobile, broadband, and internet services. The Company
also provides information and communication technology services to
corporate customers with its big data, information security, cloud
computing and IDC capabilities, and is expanding its business into
innovative technology services such as IoT, AI, etc. Chunghwa has
been actively and continuously implemented environmental, social
and governance (ESG) initiatives with the goal to achieve
sustainability and has won numerous international and domestic
awards and recognitions for its ESG commitments and best practices.
For more information, please visit our website at
www.cht.com.tw
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SOURCE Chunghwa Telecom