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At the interim results presentation, William Yeung, our Co-Owner and Executive Vice-chairman (right), and NiQ Lai, our Co-Owner and Group CEO (left), shared how HKBN is transforming to seize growth opportunities.
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Dear Friends of HKBN
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Despite COVID-19, HKBN Delivers Solid Growth for the 6 months ended 28 Feb 2021
Business Integrations and Infinite-play Strategy Buttress Resilience & Growth
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Despite the prolonged COVID-19 pandemic, today we announced solid operational and financial growth results for the six months ended 28 February 2021 (“1H2021”). Through a series of mergers and acquisitions in 2019 and integrations afterward, HKBN has evolved from a traditional telecom company in Hong Kong into a leading information and communications technology (ICT) provider across Asia. By offering innovative solutions to the market, we see these difficult times as an opportunity to assist the business transformation of enterprise customers, beyond merely selling connectivity services.
Since the start of COVID-19, we have received government subsidies from the regions we operate in and have substantially passed all of these to our Talents. This set of interim results are inclusive of those pass throughs:
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Revenue and EBITDA continued to grow year-on-year (“yoy”) at 40% and 2%, respectively, to HK$6,230 million and HK$1,312 million, while Adjusted Free Cash Flow (“AFF”) dropped by 11% yoy to HK$391 million mainly due to the one time premium paid on senior notes redemption. Core AFF after excluding premium paid on senior notes redemption increased by 7% yoy to HK$505 million.
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Revenue increased by 40% yoy to HK$6,230 million, which was mainly contributed by six months of operating results of HKBN JOS*.
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Reported EBITDA increased by 2% to HK$1,312 million, mainly contributed by the smooth integrations with WTT# and HKBN JOS which brought us operational efficiencies.
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The Board has recommended the payment of an interim dividend of 39 HK cents per share (1H2020: 37 HK cents per share), resulting in a 5% yoy increase.
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* HKBN JOS represents HKBN JOS Holdings (C.I.) Limited and its subsidiaries, Adura Hong Kong Limited and ADURA CYBER SECURITY SERVICES PTE. LTD.
# WTT represents HKBN Enterprise Solutions Development Ltd and its subsidiaries.
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Enterprise Solutions: integration synergies drove stable customer base and ARPU growth
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The integrations with WTT and HKBN JOS have greatly enhanced our combined group’s capabilities, in terms of extended customer reach, far wider service offerings, thereby empowering us to differentiate our offerings in the enterprise space. Due to HKBN’s new competitiveness, despite the prolonged COVID-19 pandemic, our enterprise business delivered growth in this difficult time with a stable number of enterprise customers at 105,000 by raising our enterprise ARPU from HK$2,775/month in 1H2020 to HK$3,028/month in 1H2021. To weather the storm with our enterprise customers and minimise the financial impact on our company, we offered innovative solutions such as FixIT outsourcing IT service, remote cloud-based HR applications and e-Security to the market. Looking forward, we will transform our enterprise business from pure sales of products & services to relationship management, thinking and acting from our customers’ perspective to solve their business problems.
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Residential Solutions: multi-play price strategy brought upsell opportunities
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During 1H2021, our Residential Solutions revenue slightly dropped by 2% yoy to HK$1,224 million, mainly contributed by the residual impact of our monthly fee waiver for COVID-19 relief in March 2020 and a drop in mobile services revenue. Meanwhile, we see lower customer switching activity and higher upsell opportunities on our OTT and other services. Overall, Residential Solutions continued to show resilience during economic uncertainties. As always, we will continue to extend our integrated multi-play price strategy to deliver unprecedented household savings and service convenience to disrupt the legacy broadband, fixed-voice, content and mobile standalone segments.
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Win-Win partnerships to further penetrate the enterprise and residential markets
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“By forming multi-win partnerships through Barter & Bundle and new shared economy platform HOME+ with like-minded partners, we are bringing different partners together into one bill for each customer. While customers enjoy better value offers riding on our partnerships, we are also in the best position to further penetrate the enterprise and residential markets, in turn, sharing a larger wallet of spending. We believe that HOME+ will be the key component of our infinite-play services to drive ARPU growth,” said our Co-Owner and Executive Vice-chairman William Yeung, and our Co-Owner and Group CEO NiQ Lai.
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For more details on our 1H2021 results, please refer to the links below:
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