China Mobile Q2 net soars 23% to $2bn

BEIJING: China Mobile, the world’s largest cellular operator by market value, had a 23% gain in second-quarter profit after adding a record number of subscribers. Net income rose to 15.8bn yuan ($1.98bn) from 12.8 bn yuan a year earlier. Sales increased to 82.1 bn yuan from 59.6 bn yuan. The figures were derived by subtracting first-quarter results from first-half earnings reported today by the Beijing-based company.

The company, which overtook Vodafone Group as the world’s largest mobile carrier by market value last month, added a record 13.1m customers in the period. Chief executive Wang Jianzhou also raised revenue by offering a wider range of services such as movie and video downloads.

The company plans to pay an interim dividend of 62 HK cents, compared with 45 HK cents a year earlier, and a special interim dividend of 9 HK cents. China Mobile also plans to pay a full-year special dividend.

For the full year, China Mobile set a dividend payout ratio, the percentage of earnings paid to shareholders, at 42%, compared with 39% a year earlier. Usage per subscriber per month rose to 367 minutes from 363 minutes a year earlier and 359 minutes in the first quarter, the company said.

First-half earnings before interest, taxes, depreciation and goodwill amortisation gained 25% to 78.3bn yuan, it said. China Mobile increased users after receiving regulatory approvals.

approval from the telecommunication regulator to cut rates and offer cheaper monthly packages for cell-phone customers in Beijing starting May.

The company also reduced international roaming charges in the provinces of Sichuan and Zhejiang. China Mobile, which offers global system for mobile communications, or GSM, services, gained 25.8m subscribers in the first six months of the year for a total of 273.8m, about two-thirds of the nation’s mobile-phone users. That’s more than Vodafone’s 186.8m users and Docomo’s 51.9m combined by the end of July.

China Unicom., the country’s second-largest mobile operator, offers services using both the GSM and code division multiple access standards. Unicom had a total of 135.1 million users at the end of June. Chief executive Wang, 57, is boosting revenue from value-added businesses such as short message services, ringtone downloads and wireless services such as emails and games.

In the first half, revenue from value-added businesses rose 37% to 30.9bn yuan from 22.6bn yuan a year earlier. Contribution from these businesses made up 22.6% of total revenue, up from 19.7% a year earlier., China Mobile said.
Revenue from short message services rose to 15.1bn yuan, from 11.6bn yuan a year earlier.