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China Mobile Doubles 4G Customer Base in 2016 to 535 mln
Source: https://www.telecompaper.com/
Source Date: Thursday, March 23, 2017
Focus: Institution and HR Management
Country: China
Created: Mar 31, 2017

China Mobile reported growth in annual results and its dividend, thanks to strong demand for mobile data services, which became its biggest source of revenue for the first time. Total revenue rose 6.0 percent to CNY 708.4 billion, and mobile service revenue increased 4.7 percent to CNY 578.2 billion. Wireless data traffic revenue was up 43.5 percent to account for 46.2 percent of total revenue from telecommunications services. 

China Mobile grew annual EBITDA 6.9 percent to CNY 256.7 billion, and net profit was up 0.2 percent to CNY 108.7 billion. Excluding the one-off gain in 2015 on the transfer of tower assets, profit increased by 10.5 percent in 2016. Free cash flow grew by 68.1 percent to CNY 66.4 billion. The dividend will increase by 0.4 percent, to HKD 2.732 per share for 2016, equal to a pay-out ratio of 46 percent of profit.

The operator ended the year with a total 848.90 million mobile customers, up 2.7 percent from 2015. It added 223 million 4G customers during the year, for a total 535 million or 63 percent of the total customer base. Customer growth was supported by the addition of around 400,000 4G base stations, increasing the total number of stations to 1.51 million and covering a population of more than 1.3 billion. The group also started VoLTE services in more than 300 cities. 

In addition, China Mobile continued its expansion in the fixed market, adding 22.59 million wireline broadband customers last year, for a total 77.62 million at year-end. Nearly 77 percent of the customers had 20 Mbps or higher, and 22.80 million took the Mobaihe video service. 

China Mobile invested a total CNY 187.3 billion last year. Its capital expenditure is expected to fall slightly to CNY 176 billion this year. In addition to adding another 260,000 4G base stations, the company plans to invest in building big data and IT resource tools, deploy its own CDN and speed up investment in data centres and IoT platforms to support its growth in the enterprise market. 

The company said it also aims to outperform service revenue growth in the industry in 2017. This comes as China is set to end domestic long-distance and roaming tariffs from October, which China Mobile estimates will take CNY 4 billion off quarterly revenue. The planned reduction in SME internet and international long-distance charges will also reduce revenue by CNY 3 billion.  

The growth this year should come from adding another 100 million 4G customers and maintaining a stable to higher mobile ARPU. 4G ARPU is already twice that of other customers, at CNY 74.4, and they generate 7.5 times as much data, at an average 1 GB per user. Total handset data traffic grew by 128 percent last year to 5,681 PB, and 4G accounted for 94 percent of the amount. 

Wireline net additions are also expected to surpass 20 million this year, and the company aims to add 100 million IoT connections in 2017.
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