HKBN flat, but on target

Robert Clark
10 Nov 2010

Hong Kong’s City Telecom International (CTI) posted flat full-year earnings but said it had increased broadband subs by more than a third to stay on track to become the city’s largest ISP by 2016.

The company – the listed vehicle of Hong Kong Broadband Network (HKBN) – announced Tuesday net income of HK$216.9 million ($27.9m), up 1.9% from 2009, and 2.1% higher ebitda of HK$479 million.

Sales grew 6.5% year-on-year to HK$1.57 billion.

The Hong Kong and Nasdaq-listed operator – currently the city’s second largest ISP –estimated it had snared 93% of new broadband subs, helped by one of the world’s best broadband bargains of 100Mbps symmetrical for HK$99 a month.

It boosted subs numbers by 34.5% to 526,000 over the year, giving it roughly 25% market share. It also boosted fiber network coverage by 150,000 to 1.77 million homes passed.

Chairman Ricky Wong said CTI had grown “mainly by taking market share in a saturated market.”

He expected ARPU to rise through a new 1Gbps broadband service, priced at HK$199 a month, and raising the price of its basic package by 71% to HK$169.

After a year of subs growth, the company’s focus would shift in 2011 from “'subscriber maximization’ to ‘profit maximization’.”

Wong also said CTI was also keen to bid for a local free to air TV license.

“The market is changing drastically, and we see exciting opportunities to leverage our fiber infrastructure as well as our accumulated wealth of intellectual momentum having been in the IP-TV business since 2003.

City Telecom’s Nasdaq stock rose 1.37% overnight and then 0.29% in after-hours trading, closing at $13.32.

MORE ARTICLES ON: CTI, Earnings, HKBN, Hong Kong

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