Tax, costs drag down Chunghwa Telecom earnings in Q3

02 Nov 2006

Chunghwa Telecom's third-quarter net profit fell 13% from the year-earlier period on higher expenses and lower tax credits, a Dow Jones report, said.

The Dow Jones report said in the January-September period, net profit was NT$34.17 billion ($1.02 billion), down 10% from NT$38.17 billion ($1.15 billion) in the year-earlier period.

The company didn't provide quarterly figures, but subtracting the net profit figure given by the company in its first-half results, third-quarter net profit was NT$11.98 billion ($360 million), which is down from NT$13.84 billion ($416 million) in the third quarter of 2005, the Dow Jones report said.

'Net profit fell because of costs related to mobile phone promotion packages and performance-based bonuses, which began after privatization,' Shen Fu-fu, Chunghwa Telecom investor relations director, was quoted by Dow Jones as saying

Third-quarter costs and expenses totaled NT$31.67 billion ($953 million), up 7.1% from NT$29.57 billion ($892 million), the Dow Jones report further said.

Chunghwa Telecom previously said net profit would decline in 2006 due to rising costs, including performance-related bonuses, third-generation amortization, and marketing expenses, the report added.

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