TAIPEI, Jan. 30,
2024 /PRNewswire/ -- Chunghwa Telecom Co., Ltd.
(TAIEX: 2412, NYSE: CHT) ("Chunghwa" or "the Company") today
reported its un-audited operating results for the fourth
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.)
Fourth Quarter 2023 Financial
Highlights
- Total
revenue increased by 4.0% to NT$ 61.86
billion.
- Consumer Business Group
revenue increased by 4.4% to NT$ 36.54
billion.
- Enterprise Business Group
revenue increased by 2.5% to NT$ 21.74
billion.
- International Business Group
revenue increased by 33.4% to NT$ 2.55
billion.
- Total operating costs and
expenses increased by 4.4% to NT$ 50.77
billion.
- Operating income decreased by
4.6% to NT$ 10.45 billion.
- EBITDA decreased by 2.2% to
NT$ 20.38 billion.
- Net income attributable to
stockholders of the parent decreased by 1.7% to NT$ 8.26 billion.
- Basic earnings per share
(EPS) was NT$1.06.
- Excluding one-time
impairments, including impairment loss of investment property and
telecom equipment caused by the phase-out of 3G network, operating
income and net income attributable to stockholders increased by
2.2% and 7.2% year over year respectively.
Full Year 2023 Financial
Highlights
- Total
revenue increased by 3.0% to NT$223.20
billion.
- Consumer Business Group
revenue increased by 3.8% to NT$ 137.09
billion.
- Enterprise Business Group
revenue increased by 1.2% to NT$ 73.00
billion.
- International Business Group
revenue increased by 27.8% to NT$ 9.19
billion.
- Total operating costs and
expenses increased by 3.6% to NT$ 176.21
billion.
- Operating income decreased by
1.0% to NT$ 46.35 billion.
- EBITDA decreased by 0.3% to
NT$ 86.01 billion.
- Net income attributable to
stockholders of the parent increased by 1.2% to NT$ 36.92 billion.
- Basic earnings per share
(EPS) was NT$4.76.
- Total revenue, net income
attributable to stockholders of the parent and EPS
exceeded the high-end target of our full-year guidance.
"Chunghwa Telecom's 2023 financial results exceeded
expectations, with FY2023 revenue and EPS hitting six-year record
highs and achieving four consecutive years of annual growth," said
Mr. Shui-Yi Kuo, Chairman and Chief
Executive Officer of Chunghwa Telecom. "In the fourth quarter of
2023, we are happy to see that in the new 3-player landscape,
Chunghwa Telecom continues to be the largest player in the
industry, holding more than 60% of the domestic industry's market
capitalization and leading mobile revenue and subscriber share of
40.2% and 37.1%, respectively, as of November 2023. Additionally, we lead the market
with over 3 million 5G subscribers. Our mobile business revenue
maintained the growth momentum, with continued growth for 33
consecutive months and a 49% uplift in monthly fee for 5G migration
this quarter. With the most extensive infrastructure, largest
network capacity, highest speed, and best quality 5G network, we
remain confident in further expanding our industry lead."
"During the quarter, all three of our business groups reported
year-over-year revenue growth, delivering solid results. For our
Consumer Business Group, the growth momentum for all core
businesses maintained upward trend. In particular, due to the
popularity of our popular global package, our international roaming
revenue in 2023 surged to exceed pre-COVID-19 levels," said Mr.
Chau-Young, Lin, President of Chunghwa Telecom. "Our Enterprise
Business Group revenue also increased YoY driven by ICT business
and mobile business growth, as revenues from cybersecurity
maintained YoY growth for 8 consecutive quarters thanks to climbing
market demands. Meanwhile, our International Business Group revenue
delivered notable 33% year-over-year growth. Pursuing further
global growth, we are also pleased to announce that we are
establishing a subsidiary in Germany in the first half of 2024 which will
serve as Chunghwa's forerunner for international expansion in
Europe and represents our
commitment to continued growth."
"In 2023, Chunghwa Telecom was recognized by the Dow Jones
Sustainability World Index as No.1 of the world-class
telecommunication sustainability leaders. In addition, we not only
received 'AA' rating from MSCI, but we were also the only company
in the global telecom industry awarded an 'AA' credit rating from
S&P Global Ratings," said Mr. Kuo, "Furthermore, to strengthen
corporate governance, we implemented a 'Compensation Clawback
Policy' to further align the interests of top management and
shareholders."
"Our history shows that our business is resilient across
economic and market cycles, and our teams continue to deliver solid
results. The significant momentum in all business offers us the
opportunity to further expand. We remain very optimistic about our
outlook to lead the industry in all aspects while creating value
for our shareholders," Mr. Shui-Yi
Kuo concluded.
Revenue
Chunghwa Telecom's total revenues for the
fourth quarter of 2024 increased by 4.0% to NT$ 61.86
billion.
Consumer Business Group's total revenue increased by 4.4% to
NT$ 36.54 billion. Mobile service
revenue increased 5.3% 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 revenue decreased by 0.3% YoY due to the expected
decrease of fixed voice revenue, while the fixed broadband revenue
grew by 3.3% year over year driven by effective package. Sales
revenue increased 6.2% YoY propelled by the increase in sales
volume of iPhone 15 series. CBG's income before tax for the fourth
quarter of 2023 decreased 0.2% owing to the asset impairment loss
accompanied with the phase-out of 3G network. However, excluding
the one-time factor, income before tax increased by 3.6% year over
year.
Enterprise Business Group's revenue increased by 2.5% to
NT$ 21.74 billion, mainly due to the
revenue increase of mobile service, ICT business and sales revenue.
In the fourth quarter, mobile service revenue continued to increase
attributable to 5G upselling and the recovery of international
roaming revenue. ICT revenue demonstrated an upward trend driven by
the growth of cybersecurity and AIoT business. Fixed-line revenue
decreased year-over-year mainly due to voice decline, although data
communication revenue and broadband access revenue continued to
grow as expected. EBG's income before tax for the fourth quarter of
2023 decreased 6.2% YoY, mainly due to fixed voice decline and the
asset impairment loss because of the phase-out of 3G network.
Excluding the one-time impairment, income before tax decreased by
4.8% year over year.
International Business Group's revenue and income before tax for
the fourth quarter of 2023 both increased by 33.4% and 38.7%YoY
respectively. Total revenue was NT$ 2.55
billion, mainly driven by the growing emerging business,
including IDC and cloud services from global clients and overseas
ICT projects from clients' global expansion.
Total revenue for the full year of 2023 increased by 3.0% to
NT$223.20 billion, mainly due to
growing core business including mobile, ICT, and broadband
services.
Operating Costs and Expenses
Total operating
costs and expenses for the fourth quarter of 2023 increased by 4.4%
to NT$ 50.77 billion, mainly due
to increasing cost of goods, ICT project cost driven by the growing
ICT business, as well as the higher electricity expenses and
manpower cost.
Total operating costs and expenses for 2023 increased by 3.6% to
NT$ 176.21 billion.
Operating Income and Net Income
Income from operations
for the fourth quarter of 2023 decreased by 4.6% to NT$ 10.45 billion. The operating margin was
16.9%, as compared to 18.4% in the same period of 2022. Net income
attributable to stockholders of the parent decreased by 1.7% to
NT$ 8.26 billion. Basic earnings per
share was NT$1.06. However, excluding
one-time impairments, including impairment loss of investment
property and telecom equipment caused by the phase-out of 3G
network, income from operation and net income attributable to
stockholders increased by 2.2% and 7.2% year over year
respectively.
Income from operations for 2023 decreased by 1.0% to
NT$ 46.35 billion but increased by
0.6% when excluding one-time impairments aforementioned. The
operating margin was 20.8%, compared to 21.6% for 2022. Net
income attributable to stockholders of the parent increased by 1.2%
to NT$ 36.92 billion. Basic earnings
per share was NT$4.76.
Cash Flow and EBITDA
Cash flow from operating
activities, as of December
31st, 2023, decreased by 1.8% year over year to
NT$ 74.56 billion.
Cash and cash equivalents, as of December
31st, 2023, decreased by 32.6% to NT$ 33.85 billion as compared to that as of
December 31st, 2022.
EBITDA for the fourth quarter of 2023 was NT$ 20.38 billion, decreasing by 2.2% year over
year. EBITDA margin was 33.0%, as compared to 35.0% in the same
period of 2022.
EBITDA for 2023 decreased by 0.3 % to NT$
86.01 billion, and EBITDA margin was 38.5%, compared to
39.8% for 2022.
Business Highlights
Mobile
As of December
31st, 2023, Chunghwa Telecom had 13.14 million
mobile subscribers, representing a 4.1% year-over-year increase. In
the fourth quarter, total mobile service revenue increased by 5.8%
year-over-year to NT$ 16.59 billion,
while mobile post-paid ARPU excluding IoT SIMs grew 4.3% year over
year to NT$ 556.
Fixed Broadband/HiNet
As of December 31st, 2023, the number of
broadband subscribers slightly increased by 0.4% to 4.40 million.
The number of HiNet broadband subscribers increased by 0.8% to 3.69
million. In the fourth quarter, total fixed broadband revenue grew
2.6% year over year to NT$ 11.12
billion, while ARPU increased 1.1% to NT$ 780.
Fixed line
As of December
31st, 2023, the number of fixed-line subscribers
was 9.15 million.
(in NT$ billion)
|
2023
|
2022
|
YoY%
|
|
Oct.-Dec.
|
Jan.-Dec.
|
Oct.-Dec.
|
Jan.-Dec.
|
Oct.-Dec.
|
Jan.-Dec.
|
Revenue
|
61.86
|
223.20
|
59.50
|
216.74
|
4.0
|
3.0
|
Operating costs and
expenses
|
50.77
|
176.21
|
48.64
|
170.01
|
4.4
|
3.6
|
Other income and
expense (Note 1)
|
(0.64)
|
(0.64)
|
0.10
|
0.09
|
(743.1)
|
(783.1)
|
Operating
income
|
10.45
|
46.35
|
10.96
|
46.82
|
(4.6)
|
(1.0)
|
Income before
tax
|
10.43
|
46.99
|
10.85
|
47.23
|
(3.8)
|
(0.5)
|
Net income attributable
to stockholders of the parent
|
8.26
|
36.92
|
8.40
|
36.48
|
(1.7)
|
1.2
|
EBITDA
|
20.38
|
86.01
|
20.84
|
86.25
|
(2.2)
|
(0.3)
|
EPS(NT$)
|
1.06
|
4.76
|
1.08
|
4.70
|
(1.7)
|
1.2
|
2024 Guidance
For 2024, the Company expects
total revenue to increase by NT$ 5.34~NT$6.99 billion, or
2.4%~3.1%, to NT$228.54~NT$230.19 billion as compared to the
un-audited consolidated total revenue of 2023. Operating costs and
expenses for 2024 are expected to increase by NT$ 7.09~NT$ 8.06
billion, or 4.0%~4.6%, to NT$183.30~NT$184.27 billion as compared
to the prior year. Income from operations is expected to decrease
by NT$ 1.12 billion, to an increase
by NT$0.15 billion, or -2.4%~0.3% to
NT$45.23~NT$46.50 billion, year over year. Income before income tax
and net income attributable to stockholders of the parent are
expected to be NT$45.90~NT$47.58 billion and NT$35.66~NT$37.20
billion, respectively. Basic earnings per share is expected to be
NT$4.60~NT$4.80.
Acquisition of Property, Plant and Equipment in 2024 is expected
to increase by NT$3.04 billion to
34.02 billion as compared to the prior year, owing to the
investments in 5G deployment to maintain competitive edge, the
expansion of internet data center, new construction of submarine
cable, and the elimination of energy-intensive equipment to realize
ESG practices.
(NT$ billion except
EPS)
|
2024(F)
|
2023
(un-audited)
|
change
|
YoY(%)
|
Revenue
|
228.54~230.19
|
223.20
|
5.34~6.99
|
2.4%~3.1%
|
Operating Costs and
Expenses
|
183.30~184.27
|
176.21
|
7.09~8.06
|
4.0%~4.6%
|
Other Income and
Expense
|
(0.01)~0.58
|
(0.64)
|
0.63~1.22
|
(193.2%)~(98.8%)
|
Income from
Operations
|
45.23~46.50
|
46.35
|
(1.12)~0.15
|
(2.4%)~0.3%
|
Non-operating
Income
|
0.67~1.08
|
0.64
|
0.03~0.44
|
5.6%~68.1%
|
Income before Income
Tax
|
45.90~47.58
|
46.99
|
(1.09)~0.59
|
(2.3%)~1.3%
|
Net Income Attributable
to Stockholders of The Parent
|
35.66~37.20
|
36.92
|
(1.26)~0.28
|
(3.4%)~0.8%
|
EPS(NT$)
|
4.60~4.80
|
4.76
|
(0.16)~0.04
|
(3.4%)~0.8%
|
EBITDA
|
85.67~86.95
|
86.01
|
(0.34)~0.94
|
(0.4%)~1.1%
|
EBITDA
Margin
|
37.5%~37.8%
|
38.5 %
|
(1.0%)~(0.7%)
|
|
Acquisition of Material
Assets
|
36.82
|
32.97
|
3.85
|
11.7 %
|
Acquisition of
Property,
Plant and Equipment
and Intangible Assets
|
34.02
|
30.98
|
3.04
|
9.8 %
|
Others
|
2.80
|
1.99
|
0.81
|
40.5 %
|
Disposal of Material
Assets
|
-
|
0.02
|
(0.02)
|
(100 %)
|
Note 1: "Other income and expenses" includes gains (losses) on
disposal of property, plant and equipment (PP&E) and
investment property, and impairment loss on PP&E and investment
property.
Note 2: The calculation of growth rates is based on NT$
thousand.
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
Contact:
Angela Tsai
Phone: +886
2 2344 5488
Email:
chtir@cht.com.tw
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SOURCE Chunghwa Telecom