HKT (6823), the largest local telecommunications network operator, yesterday said its interim net profit grew 3 percent to HK$2.4 billion, but revenue fell 5 percent to HK$15.6 billion.
Basic earnings per share stapled unit was 31.57 HK cents. It declared an interim distribution per share stapled unit of 28.12 HK cents.
HKT said revenue from telecommunications services was stable at HK$10.3 billion, but revenue from mobile business fell 11 percent to HK$5.5 billion, as handset sales revenue slumped 42 percent, due to lack of marquee handset offerings.
It said the number of its mobile subscribers was 7 percent lower at end- June at 4.2 million. But post-paid exit average revenue per user rose to HK$230 from HK$228 as of June 30.
HKT said the number of prepaid subscribers fell 24 percent to about 1.05 million as it reduced its focus on certain low margin prepaid segments.
Due to fierce competition in the mobile market, subscription fees for mobile phone services have dropped to a record low. HKT group managing director Alex Arena said the situation is unsustainable and the group will focus more on customer service.
"It's not about the price, but more on services, with customers having a person to talk to," he added.
HKT spent about 10 percent more on customer acquisition cost in the first half of the year, Arena said, adding the phone model that is being sold is significant. The higher the subsidy is, the higher the monthly fee is and this helps drive up the income of the group's mobile business, he added.
Late last month, Hutchison Telecommunications (0215) sold its fixed-line network business for US$1.9 billion (HK$14.82 billion). Arena declined to comment on the deal, but said HKT has the advantages of combined mobile and fixed-line services.