(Indicate by
check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.)
(Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule
101(b)(1): )
(Indicate by check mark if the registrant is
submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): )
(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information
to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
(If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule
12g3-2(b):82- .)
Certain statements contained in this Form 6-K may be viewed as forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These forward-looking statements are, by their nature, subject to significant risks and uncertainties, and include, without
limitation, statements relating to:
The words anticipate, believe, could, estimate, expect, intend,
may, plan, seek, will, would and similar expressions, as they relate to us, are intended to identify a number of these forward-looking statements.
These forward-looking statements are subject to risks, uncertainties and assumptions, some of which are beyond our control. In addition, these
forward-looking statements reflect our current views with respect to future events and are not a guarantee of future performance. We are under no obligation to update these forward-looking statements and do not intend to do so. Actual results may
differ materially from the information contained in the forward-looking statements as a result of a number of factors, including, without limitation, the following:
Please also see the Risk Factors section of the Companys latest Annual Report on Form 20-F, as filed with the Securities and
Exchange Commission.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.
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CHINA TELECOM CORPORATION LIMITED
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Date: August 24, 2016
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By:
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/s/ Yang Jie
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Name:
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Yang Jie
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Title:
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Chairman and Chief Executive Officer
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4
Exhibit 1.1
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no
representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.
China Telecom Corporation Limited
(A joint stock limited company incorporated in the Peoples Republic of China with limited liability)
(Stock Code: 728)
ANNOUNCEMENT OF INTERIM RESULTS
FOR THE SIX MONTHS ENDED 30 JUNE 2016
HIGHLIGHTS
|
|
Operating revenues amounted to RMB176,828 million, increased by 7.2% over the same period last year and achieved industry-leading growth. Service revenues amounted to RMB155,222 million, up by 5.6% over the same period
last year
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|
|
EBITDA was RMB50,555 million, declined by 0.4% over the same period last year. EBITDA margin was 32.6%
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Profit attributable to equity holders of the Company was RMB11,673 million, increased by 6.3% over the same period last year. Basic earnings per share were RMB0.14
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The number of mobile subscribers reached 207 million, representing a net addition of 9.04 million from the end of last year, of which: the number of 4G terminal users reached 90.10 million, with a net
addition of 31.64 million from the end of last year. Handset Internet data traffic increased by 135% over the same period last year
|
|
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The number of wireline broadband subscribers reached 118 million, representing a net addition of 4.94 million from the end of last year. Of which, total Fibre-to-the-Home (FTTH) subscribers was
88.34 million, representing a net addition of 17.35 million from the end of last year while the average bandwidth of wireline broadband subscribers reached 37 Mbps
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e-Surfing HD (IPTV) subscribers reached 50.16 million, representing a net addition of 9.78 million from the end of last year
|
A-1
CHAIRMANS STATEMENT
In the first half of 2016, with a unitary goal cohering as a whole, the Company adhered to the established development strategy to persist in excellent
execution. Firmly seizing opportunities and taking steps in reform and innovation, the Company accomplished brilliant results. With accelerated expansion of operation scale, our business structure was continually optimised while our competitive
capabilities were remarkably strengthened. The vitality of our employees was fully demonstrated. Through proactively grasping the arising opportunities and adapting to the changing trends in a timely manner, the Company firmly established a new
strategy on transformation and upgrades, aimed at providing superb customer experience in an era of intellectual services and facilitating the Companys evolution into a leading integrated intelligent information services operator.
OVERALL RESULTS
In the first half of 2016, the Company
had excellent performance in its overall results. Operating revenues amounted to RMB176.8 billion, representing an increase of 7.2% over the same period last year, achieving industry-leading growth. Service revenues
1
amounted to RMB155.2 billion, representing an increase of 5.6% over the same period last year with continual rapid optimisation in revenue structure. EBITDA
2
was RMB50.6 billion while EBITDA margin
2
was 33%. Profit attributable to the equity holders of the Company was RMB11.7 billion, representing an
increase of 6.3% over the same period last year. Basic earnings per share were RMB0.14. Capital expenditure was RMB40.7 billion while free cash flow
3
was RMB6.1 billion.
Taking into consideration the Companys profitability, cash flow level and the capital requirements for future development, the Board of Directors has
decided not to pay an interim dividend this year in order to maintain adequate funding flexibility. The Board of Directors will proactively consider the expectation of shareholders return and evaluate the final dividend proposal when reviewing
the full year results and will propose to the shareholders general meeting accordingly.
Scale Breakthrough with Favourable Trends
In the first half of the year, the Company comprehensively implemented aggressive marketing strategy and emphasised the operating focuses,
2+5
4
. With persistent promotion of in-depth integration and enhancement in efficiently-centralised operation, the Company expanded open cooperation and fully leveraged the
differentiated edges, resulting in notable improvements in competitive strengths.
1
|
Service revenues were calculated based on operating revenues minus sales of mobile terminals, sales of wireline equipment and other non-service revenues.
|
2
|
EBITDA was calculated based on operating revenues minus operating expenses plus depreciation and amortisation while EBITDA margin was calculated based on EBITDA divided by service revenues.
|
3
|
Free cash flow was calculated from EBITDA minus capital expenditure and income tax.
|
4
|
2+5 refers to two fundamental businesses namely 4G and fibre broadband plus five emerging areas namely e-Surfing HD, BestPay, Internet of Things, cloud and Big Data and Internet+.
|
A-2
Comprehensive upgrade in 4G capabilities to drive industry-leading growth in mobile business.
By fully
leveraging the competitive advantages in 4G network and multi-mode handsets, the Company increased efforts in integration and the effect of 4G driving the scale development of mobile business was evident. The net increase of 4G terminal
users was 31.64 million, accounting for 18% market share in industrys net additions. The total number of 4G terminal users reached 90.10 million, accounting for 15.2% market share. The net increase of mobile subscribers was
9.04 million, accounting for 32% market share in industrys net additions. The total number of mobile subscribers reached approximately 210 million, representing 15.9% market share. 4G users accounted for 44% of total mobile
subscribers, representing an increase of 14 percentage points from the end of last year. The monthly average data traffic per 4G user reached 889 MB while the aggregate handset Internet data traffic increased by 135% compared to the same period last
year. The mobile handset Internet access revenue increased by 42% over the same period last year, accounting for 47% of the mobile service revenues. The mobile service revenues increased by 8.3% over the same period last year, outperforming the
industry growth.
Sustained expansion of fibre broadband edges to further strengthen our leading position in broadband service.
The Company
proactively implemented the national strategy of Broadband China and insisted on expediting bandwidth upgrade in broadband. Persistently driven by 100 Mbps products with trial run of 1,000 Mbps products, the Company comprehensively
integrated and optimised our services quality, resulting in remarkable achievements in development. The wireline broadband service revenue increased by 3.3% over the same period last year, driving the wireline service revenues achieved healthy
growth. The net addition of Fibre-to-the-Home (FTTH) subscribers was 17.35 million, reaching a total of 88.34 million. The net addition of wireline broadband subscribers was 4.94 million, reaching a total of approximately 120 million. FTTH
subscribers accounted for 75% of the total wireline broadband subscribers, an increase of 12 percentage points from the end of last year. The market share of wireline broadband business within the service area of the Companys wireline
operations was 62% whereas the market share of FTTH subscribers was approximately 66%, continuing to maintain the leading position in wireline broadband market.
Rapid expansion in emerging areas and accelerated cultivation of new growth engines.
Leveraging the e-Surfing HD platform and smart home gateway, and
riding on our competitive advantages in subscribers scale, the Company endeavoured to build a Smart Family system. The net addition of e-Surfing HD subscribers was 9.78 million, representing an increase of 129% as compared with the
subscriber growth number recorded in the same period last year. The total number of e-Surfing HD subscribers exceeded 50 million while the revenue increased by 33% over the same period last year. The number of active BestPay
subscribers exceeded 8 million and BestPay positioned the second in third-party ranking of mobile payment industry apps
5
, while total transaction amount was approximately RMB380
billion. The whole-network efficient-centralisation of Internet of Things (IoT) business was launched in April with a focus on key breakthroughs in areas such as smart transport, smart logistics, wearable devices and Internet of vehicles. In the
first half of the year, the net addition of IoT connections exceeded 3 million. The Company will expedite the construction of an advanced IoT platform through self-R&D and cooperation. Fully leveraging the integration of cloud and network
together with the existing data resources advantages, the Company accelerated efficiently-centralised development of cloud and Big Data businesses. The revenues from cloud services increased by 41% over the same period last year while the revenues
from Big Data increased by nearly 3 times. We actively explored and developed the Internet+ market with a focus on three key areas including government administration, education and healthcare and hence the quantity of orders from key
government and enterprise customers increased by nearly 30% over the second half of last year. The development trend of emerging areas progressed well with vast potentials in the future prospect.
5
|
Data source: Top 20 mobile payment apps in June 2016 by Analysys.cn.
|
A-3
Excellent execution with notable advantages
In the first half of the year, the Company examined and assessed the market trends, planned meticulously and executed efficiently to establish new and
all-rounded competitive advantages while striving to promote changes towards a more favourable direction for the Company in the competitive landscape.
Extensive in-depth integration.
Exploiting the competitive strengths in full-service operation, the Company promoted in-depth integration and
innovative development in various areas including business, network, platform and services, resulting in mutual promotion and interactions amongst respective businesses while effectively driving concurrent enhancements in scale and value. The
high-value users subscribing to 4G, fibre broadband and e-Surfing HD services accounted for 45%
6
of total subscribers, facilitating the steady growth in operating revenues. Integration has become
the Companys strong and powerful competitive edge.
Leading superior network.
4G and fibre broadband formed and shaped competitive
network advantages featuring broad coverage, fast network speed and high stability. In highly profitable 4G service areas, the Company fully leveraged the strengths of international mainstream FDD technology, spectrum resources and co-sharing of
telecommunications towers as well as appropriately utilised carrier aggregation technologies. The integrated experience of the Companys 4G network has become users preferred choice. Meanwhile, the Company has been approved to refarm the
800 MHz frequency bandwidth and planned to build a nationwide high quality 800 MHz LTE network in year 2017 at low costs to achieve 4G network coverage in rural areas and in-depth coverage in cities. We will lay down the foundations for the VoLTE
and NB-IoT networks so as to foster rapid accomplishment of industry-leading 4G network quality. Through the acceleration of fibre network coverage, end-to-end bandwidth upgrade and interconnection of data centres, the Company effectively secured a
high speed and high quality network browsing experience for our customers. In the first half of the year, the average bandwidth of wireline broadband subscribers reached 37 Mbps, representing 20% higher than the industry average. This further
strengthened the Companys leading market position in the fibre broadband industry, where we led the high-bandwidth development trends.
6
|
Up to the first half of 2016, the total number of users subscribing to access lines in service, mobile, wireline broadband and e-Surfing HD of the Company reached approximately 510 million.
|
A-4
Flexible and innovative marketing strategies.
The Company endeavoured to promote multi- mode
handsets as market mainstream, effectively expanding our sales radius and significantly improving our terminal competitiveness. Data traffic operations were further promoted and the cooperation with heavy data usage products such as video content
was further reinforced, continuously enhancing data traffic scale and value. The Company continuously implemented the Speed Upgrade and Tariff Reduction, gradually cancelled the long-distance and roaming charges, proactively innovated
the billing model and became the pioneer in China to explore and introduce on trial basis the All-charge-as-data billing, which effectively simplified customers choices and profoundly enhanced service attractiveness. The Company
actively implemented Internet-orientation of channels, enhancing high collaborative operations of online and physical channels. The coverage and sales capabilities of physical channels were significantly improved while online channels have become
the main sales channel for services such as data traffic packages and online top-up. The proportion of users derived from online channels continued to increase.
Remarkable achievements in cooperation.
The Company took the initiative in innovation of development model, extensively consolidated competitive
resources, cooperated with strong partners, resulting in a win-win outcome. Fully leveraging the co-sharing of telecommunications towers resources, the Company has been at the forefront of offering a superior 4G network experience rapidly. With the
promotion of in-depth cooperation with other parties in the industry and enhancements in the co-building and co-sharing of networks, the Company successfully promoted multi-mode handsets as a national standard. In the first half of the
year, the proportion of multi-mode handsets sold in the industry reached 34%, enabling the Company to swiftly achieve the decisive breakthrough in developmental bottleneck. In emerging areas such as Smart Family, mobile
payment, Internet+, cloud and Big Data, and IoT, the Company proactively carried out crossover cooperation and cultivated a highly efficient and synergetic industrial ecosystem by focusing on product services, network platforms, sales
channels and resource integration. Our differentiated competitive strengths were effectively enhanced.
Convenient and highly-efficient services.
The Company has always persisted in consumer- oriented focus with continual enhancement of customer experience. In order to achieve the integration of marketing and maintenance as a whole, the Company introduced service modes such as instant
installation process at sales and pay after installation. The online and physical channels were well coordinated, effectively expanding service channels. The Company comprehensively promoted premier services and the capabilities of
the entire process service were continuously improved. In the first half of the year, the Company was ranked first in the industry in customer satisfaction for both mobile Internet and wireline Internet services.
Persistent and unwavering reform.
The Company adhered to the reforms of mechanism and system, and continued the in-depth promotion of subdivision of
performance evaluation units. The Company increased efforts in promoting frontline entrepreneurial platform to persistently stimulate the vitality of employees, resulting in continual enhancement in the morale of development. The results of
frontline performance contract units remarkably improved. By strengthening the market-oriented corporate resources allocation, together with the establishment and gradual optimisation of top-down integrated service support system and
effective collaboration of front-end and back-end operations, the efficiency and effectiveness of the Companys overall operation was significantly improved. The Internet+ talent development programme was established with a focus on
nurturing a team of new talents including both professional and technical personnel, hence strengthening the Companys ability to attract talents. Vigorously promoting the transformation of achievements in innovation, the Company became the
first batch of the states model in mass entrepreneurship and innovation.
A-5
Continual optimisation of operation management.
Through precision management and efficiently-centralised
operations, the quality and efficiency of our operations were significantly improved. The Company persistently promoted automation of network maintenance and further improved IT operational efficiency by leveraging support systems such as MSS,
resulting in continuous enhancement in efficient centralisation of networks and IT operations. Through proactively deploying the co-building and co-sharing of networks, continually improving the financial management, strengthening the scope and
depth of centralised procurement, and improvement in investment and cost efficiency, our corporate value was continually enhanced.
Comprehensive
transformation and upgrades
Starting from the end of 2004, the Company unwaveringly persisted in pursuing strategic transformation and upgrades, and
has surmounted tough difficulties to pave a new path for promoting China Telecoms development through transformation. At the end of 2004, the Company first put forth strategic transformation (Transformation 1.0)
7
, achieving a change from telecommunications to information services. By the end of 2010, the Company proposed in-depth transformation (Transformation
2.0)
8
and explicitly defined the clear positioning of Three New Roles in order to adapt to the latest trend of mobile Internet and to proactively explore emerging business areas. The
history has proved and confirmed that each and every tranformation and upgrade in more than ten years in the past represented China Telecom always accurately grasps the prevailing development trends as every transformation and upgrade resulted in
remarkable achievements. This also demonstrated that forward-looking strategic planning and trend-leading role are both vital to overall corporate development.
At present, we are about to enter into an advanced stage of information civilisation of mankind, the era of intellectual service. The Company officially
established a comprehensive transformation and upgrades plan (Transformation 3.0) at the end of June 2016 and positioned itself as a leading integrated intelligent information services operator. Intelligent information services built on
digitalisation and networkisation as fundamentals; widely used intellectualisation technologies such as cloud computing, Big Data, Mobile Internet, IoT, artificial intelligence as main drivers; in-depth integration between cloud and network
including Software-Defined Networking (SDN), Network Functions Virtualisation (NFV), hardware generalisation and platform-based capabilities development as the priority; deepened exploration and value realisation of corporate internal and external
data resources as the norm; and diversified intelligent terminals as the carrier, altogether enables the Company to accomplish crossover development in different areas.
7
|
Transformation 1.0 defined the corporate as Telecom Full Service Provider, Internet Applications Aggregator and Leading Enterprise ICT Service Provider.
|
8
|
Transformation 2.0 adjusted the corporates positioning as the Leader of Intelligent Pipeline, the Provider of Integrated Platforms and the Participant of Content & Application Development.
|
A-6
The Company will focus and link through the main theme of intelligence and will promote the reconstitution of
network, business, operations and management based on the three main directions namely network intelligentisation, service ecologicalisation and operation intellectualisation. Integrated intelligent information services featuring connection on
demand, automatic response, realistic virtual experience and high price-to-performance ratio will be provided to customers.
Network intelligentisation:
Being guided by CTNet2025
9
, the
Company will promote network reconstitution, deepen open-source technology applications to accomplish the open integration of network and IT, moving forward towards the combination of development and operations as a whole. The Company will be able
to provide customers with state-of-the-art network experience with embedded visible, self-selective and self- served characteristics.
Service ecologicalisation:
The Company will further emphasise the key operating focus, 2+5.
Through open cooperation, integrated innovation and promotion of business reconstitution, the Company will endeavour to build up the five key business ecosystems, namely Intelligent Connection, Smart Family, Internet Finance, new style ICT
applications, and IoT in order to achieve co-existence, co-innovation and win-win outcomes.
Operation intellectualisation:
Being driven by Big Data applications, through enhancement of six key capabilities in network fundamentals,
network operations, data operation, channel sales, customer service and talent development in order to promote the reconstitution of operations and management to support smart operations.
Recently, the Company has commenced the implementation of Transformation 3.0. With the completion of the top-level design on network reconstitution, the
Company published the CTNet2025 white paper and launched the first series of network reconstitution projects encompassing various areas such as network framework, fundamental scientific R&D, network engineering and product development.
Surrounding the prevailing 2+5 operating focuses, ecological alliances in the industry comprising Smart Family, IoT and Big Data, etc. have been gradually formed. The Company launched the system and evaluation performance
index of Smart Family. With BestPay payment system as the core, the Company accelerated the development of emerging areas including consumer finance and proactively nurtured the industry ecosystem. Through an in-depth
exploration and extensive applications coverage of Big Data, the Company will pragmatically promote operation intellectualisation through precision marketing, precision management, dedicated services and lean operations.
As an excellent corporate citizen
We are committed to
maintaining a high level of corporate governance, attaching great importance to risk management and control. We strive to enhance corporate transparency and value to ensure our healthy and orderly growth. Our persistent efforts in corporate
governance have been widely recognised by the capital markets. We have been accredited with a number of awards and recognition for the year to date, including being voted as the Most Honoured Companies in Asia by
Institutional
Investor
for six consecutive years. The Company was also awarded the Platinum Award Best Telecommunications Company in Asia by
FinanceAsia
which honoured institutions and corporations in Asia consistently providing
quality, excellent and innovative services to their customers over the past 20 years.
9
|
CTNet2025 refers to
China Telecoms CTNet2025 Network Structure White Paper
.
|
A-7
We persisted in operating with integrity and proactively fulfilled our corporate social responsibility while
maintaining a fair and orderly environment for market competition and facilitating the healthy development of the entire value chain. Meanwhile, we actively promoted green operations, through further strengthening energy conservation and emissions
reduction to improve the efficiency of resource utilisation. We vigorously promoted broadband penetration in rural areas in order to bridge the information gap between urban and rural areas. We received high recognition and appreciation from society
through our efforts in combating catastrophic flooding in Southern China.
Endeavour to become bigger, better and stronger
Currently, the implementation of the national strategy of Cyberpower coupled with the promotion of supply-side structural reform will foster an
advanced level equilibrium of supply and demand. This positive policy environment creates favourable conditions for the sustainable and healthy development of the industry. The Company will seize new development opportunities for transformation and
upgrades.
In the second half of the year, the Company will proactively respond to the increasingly intensified market competition and changes in external
environment. Oriented by market share dominance, the Company will expedite the scale development of two fundamental businesses, effectively collaborate on the operations of five major emerging areas while also endeavouring to enhance the six key
capabilities in order to accelerate the transformation of our resource edges and capabilities into competitive strengths. With reform and innovation as the driving force, the Company will promote the development strategy with talent development as
the priority, optimise the market-oriented incentive mechanism, bolster vitality and improve efficiency in order to lay down a solid foundation for accelerated transformation and upgrades. At the same time, the Company will comprehensively promote
reconstitution of four major areas including business, network, operations and management in order to accelerate the implementation of the new strategy on transformation and upgrades. The Company will strive to become a leading integrated
intelligent information services operator, facilitate development towards the national strategy of Cyberpower and also serve society and the general public as a whole, while continuously creating new value for shareholders.
Finally, on behalf of the Board of Directors, I would like to take this opportunity to express my sincere appreciation to all our shareholders and customers
for their support. I would also like to express my sincere thanks to all our employees for their hard work and contributions. Furthermore, I would like to extend my sincere gratitude towards Mr. Zhang Jiping and Mr. Zhu Wei for their
excellent contributions during their tenure of office as the Directors of the Company.
Yang Jie
Chairman and Chief Executive Officer
Beijing, China
23 August 2016
A-8
GROUP RESULT
China Telecom Corporation Limited (the Company) is pleased to announce the unaudited consolidated results of the Company and its subsidiaries (the
Group) for the six months ended 30 June 2016 extracted from the unaudited interim financial statements of the Group as set out in its 2016 Interim Report.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED)
for the six-month period ended 30 June 2016
(Amounts in millions, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
Note
|
|
|
2016
RMB
|
|
|
2015
RMB
|
|
Operating revenues
|
|
|
3
|
|
|
|
176,828
|
|
|
|
164,953
|
|
Operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortisation
|
|
|
|
|
|
|
(33,447
|
)
|
|
|
(33,585
|
)
|
Network operations and support
|
|
|
|
|
|
|
(43,951
|
)
|
|
|
(37,224
|
)
|
Selling, general and administrative
|
|
|
|
|
|
|
(27,319
|
)
|
|
|
(25,062
|
)
|
Personnel expenses
|
|
|
|
|
|
|
(28,909
|
)
|
|
|
(28,079
|
)
|
Other operating expenses
|
|
|
|
|
|
|
(26,094
|
)
|
|
|
(23,849
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating expenses
|
|
|
|
|
|
|
(159,720
|
)
|
|
|
(147,799
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit
|
|
|
|
|
|
|
17,108
|
|
|
|
17,154
|
|
Net finance costs
|
|
|
4
|
|
|
|
(1,728
|
)
|
|
|
(2,160
|
)
|
Investment income
|
|
|
|
|
|
|
9
|
|
|
|
6
|
|
Share of profits/(losses) of associates
|
|
|
|
|
|
|
80
|
|
|
|
(456
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit before taxation
|
|
|
|
|
|
|
15,469
|
|
|
|
14,544
|
|
Income tax
|
|
|
5
|
|
|
|
(3,747
|
)
|
|
|
(3,536
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
|
11,722
|
|
|
|
11,008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A-9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
Note
|
|
|
2016
RMB
|
|
|
2015
RMB
|
|
Other comprehensive income for the period:
|
|
|
|
|
|
|
|
|
|
|
|
|
Items that may be reclassified subsequently to profit or loss:
|
|
|
|
|
|
|
|
|
|
|
|
|
Change in fair value of available-for-sale equity securities
|
|
|
|
|
|
|
(342
|
)
|
|
|
967
|
|
Deferred tax on change in fair value of available-for-sale equity securities
|
|
|
|
|
|
|
86
|
|
|
|
(242
|
)
|
Exchange difference on translation of financial statements of subsidiaries outside mainland
China
|
|
|
|
|
|
|
37
|
|
|
|
(11
|
)
|
Share of other comprehensive income of associates
|
|
|
|
|
|
|
6
|
|
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income for the period, net of tax
|
|
|
|
|
|
|
(213
|
)
|
|
|
715
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
|
|
|
11,509
|
|
|
|
11,723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity holders of the Company
|
|
|
|
|
|
|
11,673
|
|
|
|
10,980
|
|
Non-controlling interests
|
|
|
|
|
|
|
49
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit for the period
|
|
|
|
|
|
|
11,722
|
|
|
|
11,008
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income attributable to:
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity holders of the Company
|
|
|
|
|
|
|
11,460
|
|
|
|
11,695
|
|
Non-controlling interests
|
|
|
|
|
|
|
49
|
|
|
|
28
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the period
|
|
|
|
|
|
|
11,509
|
|
|
|
11,723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
|
6
|
|
|
|
0.14
|
|
|
|
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares (in millions)
|
|
|
|
|
|
|
80,932
|
|
|
|
80,932
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A-10
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (UNAUDITED)
at 30 June 2016
(Amounts in millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
Note
|
|
30 June
2016
RMB
|
|
|
31 December
2015
RMB
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
|
|
|
|
|
Property, plant and equipment, net
|
|
|
|
|
365,571
|
|
|
|
373,981
|
|
Construction in progress
|
|
|
|
|
84,206
|
|
|
|
69,103
|
|
Lease prepayments
|
|
|
|
|
23,252
|
|
|
|
23,609
|
|
Goodwill
|
|
|
|
|
29,921
|
|
|
|
29,920
|
|
Intangible assets
|
|
|
|
|
10,337
|
|
|
|
10,739
|
|
Interests in associates
|
|
|
|
|
34,559
|
|
|
|
34,473
|
|
Investments
|
|
|
|
|
1,415
|
|
|
|
1,624
|
|
Deferred tax assets
|
|
8
|
|
|
4,701
|
|
|
|
4,655
|
|
Other assets
|
|
|
|
|
3,250
|
|
|
|
3,349
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-current assets
|
|
|
|
|
557,212
|
|
|
|
551,453
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets
|
|
|
|
|
|
|
|
|
|
|
Inventories
|
|
|
|
|
5,166
|
|
|
|
6,281
|
|
Income tax recoverable
|
|
|
|
|
18
|
|
|
|
105
|
|
Accounts receivable, net
|
|
9
|
|
|
29,077
|
|
|
|
21,105
|
|
Prepayments and other current assets
|
|
|
|
|
18,524
|
|
|
|
16,229
|
|
Short-term bank deposits
|
|
|
|
|
2,836
|
|
|
|
2,519
|
|
Cash and cash equivalents
|
|
|
|
|
30,076
|
|
|
|
31,869
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets
|
|
|
|
|
85,697
|
|
|
|
78,108
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
642,909
|
|
|
|
629,561
|
|
|
|
|
|
|
|
|
|
|
|
|
A-11
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note
|
|
|
30 June
2016
RMB
|
|
|
31 December
2015
RMB
|
|
LIABILITIES AND EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term debt
|
|
|
|
|
|
|
35,312
|
|
|
|
51,636
|
|
Current portion of long-term debt
|
|
|
|
|
|
|
153
|
|
|
|
84
|
|
Accounts payable
|
|
|
10
|
|
|
|
126,112
|
|
|
|
118,055
|
|
Accrued expenses and other payables
|
|
|
|
|
|
|
92,172
|
|
|
|
82,934
|
|
Income tax payable
|
|
|
|
|
|
|
955
|
|
|
|
2,154
|
|
Current portion of finance lease obligations
|
|
|
|
|
|
|
23
|
|
|
|
38
|
|
Current portion of deferred revenues
|
|
|
|
|
|
|
1,158
|
|
|
|
1,028
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities
|
|
|
|
|
|
|
255,885
|
|
|
|
255,929
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net current liabilities
|
|
|
|
|
|
|
(170,188
|
)
|
|
|
(177,821
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets less current liabilities
|
|
|
|
|
|
|
387,024
|
|
|
|
373,632
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term debt and payable
|
|
|
|
|
|
|
70,570
|
|
|
|
64,830
|
|
Finance lease obligations
|
|
|
|
|
|
|
99
|
|
|
|
81
|
|
Deferred revenues
|
|
|
|
|
|
|
2,345
|
|
|
|
1,454
|
|
Deferred tax liabilities
|
|
|
8
|
|
|
|
3,741
|
|
|
|
2,061
|
|
Other non-current liabilities
|
|
|
|
|
|
|
469
|
|
|
|
455
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-current liabilities
|
|
|
|
|
|
|
77,224
|
|
|
|
68,881
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities
|
|
|
|
|
|
|
333,109
|
|
|
|
324,810
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital
|
|
|
|
|
|
|
80,932
|
|
|
|
80,932
|
|
Reserves
|
|
|
|
|
|
|
227,857
|
|
|
|
222,852
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity attributable to equity holders of the Company
|
|
|
|
|
|
|
308,789
|
|
|
|
303,784
|
|
Non-controlling interests
|
|
|
|
|
|
|
1,011
|
|
|
|
967
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity
|
|
|
|
|
|
|
309,800
|
|
|
|
304,751
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities and equity
|
|
|
|
|
|
|
642,909
|
|
|
|
629,561
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A-12
Notes:
These interim financial statements have been prepared in
accordance with International Accounting Standard 34, (IAS 34)
Interim Financial Reporting
issued by the International Accounting Standards Board and the applicable disclosure requirements of Appendix 16 to the Rules
Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. These interim financial statements, which were authorised for issuance by the Board of Directors on 23 August 2016, reflect the unaudited financial position of the
Group as at 30 June 2016 and the unaudited results of operations and cash flows of the Group for the six-month period then ended, which are not necessarily indicative of the results of operations and cash flows expected for the year ending
31 December 2016.
These interim financial statements are prepared on the historical cost basis as modified by the revaluation of
certain available-for-sale equity securities at fair value.
Except as described below, these interim financial statements have been
prepared in accordance with the same accounting policies adopted in the 2015 annual financial statements of the Group.
In the current
interim period, the Group has applied, for the first time, the following amendments to International Financial Reporting Standards (IFRSs) issued by the International Accounting Standards Board that are mandatorily effective for the
current period:
Amendments to IFRS 11, Accounting for Acquisitions of Interests in Joint Operations
Amendments to IAS 1, Disclosure Initiative
Amendments to IAS 16 and IAS 38, Clarification of Acceptable Methods of Depreciation and Amortisation
Amendments to IFRSs, Annual Improvements to IFRSs 2012-2014 Cycle
Amendments to IAS 16 and IAS 41, Agriculture: Bearer Plants
Amendments to IFRS 10, IFRS 12 and IAS 28, Investment Entities: Applying the Consolidation Exception
The application of the above amendments to IFRSs has had no material effect on the Groups interim financial statements.
These interim financial statements are unaudited, but have been reviewed by the Audit Committee of the Company. These interim financial
statements have also been reviewed by the Companys international independent auditor in accordance with Hong Kong Standard on Review Engagements 2410, Review of Interim Financial Information Performed by the Independent Auditor of the
Entity, issued by the Hong Kong Institute of Certified Public Accountants.
A-13
An operating segment is a component of an entity that engages in
business activities from which revenues are earned and expenses are incurred, and is identified on the basis of the internal financial reports that are regularly reviewed by the chief operating decision maker in order to allocate resources and
assess performance of the segment. For the periods presented, management has determined that the Group has one operating segment as the Group is only engaged in the integrated telecommunications business. The Groups assets located outside
mainland China and operating revenues derived from activities outside mainland China are less than 10% of the Groups assets and operating revenues, respectively. No geographical area information has been presented as such amount is immaterial.
No single external customer accounts for 10 percent or more of the Groups operating revenues.
Operating revenues represent revenues from the provision of
telecommunications services. The components of the Groups operating revenues are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
Note
|
|
|
2016
RMB millions
|
|
|
2015
RMB millions
|
|
Wireline voice
|
|
|
(i)
|
|
|
|
13,580
|
|
|
|
15,268
|
|
Mobile voice
|
|
|
(ii)
|
|
|
|
22,839
|
|
|
|
24,889
|
|
Internet
|
|
|
(iii)
|
|
|
|
73,017
|
|
|
|
62,274
|
|
Value-added services
|
|
|
(iv)
|
|
|
|
20,839
|
|
|
|
20,128
|
|
Integrated information application services
|
|
|
(v)
|
|
|
|
13,987
|
|
|
|
13,966
|
|
Telecommunications network resource services and lease of network equipment
|
|
|
(vi)
|
|
|
|
8,928
|
|
|
|
8,667
|
|
Others
|
|
|
(vii)
|
|
|
|
23,638
|
|
|
|
19,761
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
176,828
|
|
|
|
164,953
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note:
(i)
|
Represent the aggregate amount of monthly fees, local usage fees, domestic long distance usage fees, international, Hong Kong, Macau and Taiwan long distance usage fees, interconnections fees and installation fees
charged to customers for the provision of wireline telephony services.
|
(ii)
|
Represent the aggregate amount of monthly fees, local usage fees, domestic long distance usage fees, international, Hong Kong, Macau and Taiwan long distance usage fees and interconnections fees charged to customers for
the provision of mobile telephony services.
|
(iii)
|
Represent amounts charged to customers for the provision of Internet access services.
|
(iv)
|
Represent the aggregate amount of fees charged to customers for the provision of value-added services, which comprise primarily caller ID services, short messaging services, Colour Ring Tone, Internet data centre and
Virtual Private Network services and etc.
|
A-14
(v)
|
Represent primarily the aggregate amount of fees charged to customers for Best Tone information services and IT services and applications.
|
(vi)
|
Represent primarily the aggregate amount of fees charged to customers for the provision of telecommunications network resource services and lease income from other domestic telecommunications operators and enterprise
customers for the usage of the Groups telecommunications networks and equipment.
|
(vii)
|
Represent primarily revenue from sale, and repair and maintenance of equipment as well as the resale of mobile services (MVNO).
|
Net finance costs comprise:
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
2016
RMB millions
|
|
|
2015
RMB millions
|
|
Interest expense incurred
|
|
|
2,110
|
|
|
|
2,517
|
|
Less: Interest expense capitalised*
|
|
|
(211
|
)
|
|
|
(155
|
)
|
|
|
|
|
|
|
|
|
|
Net interest expense
|
|
|
1,899
|
|
|
|
2,362
|
|
Interest income
|
|
|
(170
|
)
|
|
|
(164
|
)
|
Foreign exchange losses
|
|
|
38
|
|
|
|
11
|
|
Foreign exchange gains
|
|
|
(39
|
)
|
|
|
(49
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
1,728
|
|
|
|
2,160
|
|
|
|
|
|
|
|
|
|
|
* Interest expense was capitalised in construction in progress at the following rates per
annum
|
|
|
3.3%-5.0
|
%
|
|
|
3.8%-5.7
|
%
|
|
|
|
|
|
|
|
|
|
Income tax in the profit or loss comprises:
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
2016
RMB millions
|
|
|
2015
RMB millions
|
|
Provision for PRC income tax
|
|
|
1,967
|
|
|
|
3,922
|
|
Provision for income tax in other tax jurisdictions
|
|
|
60
|
|
|
|
28
|
|
Deferred taxation
|
|
|
1,720
|
|
|
|
(414
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
3,747
|
|
|
|
3,536
|
|
|
|
|
|
|
|
|
|
|
A-15
A reconciliation of the expected tax expense with the actual tax expense is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six-month period ended
30 June
|
|
|
|
Note
|
|
|
2016
RMB millions
|
|
|
2015
RMB millions
|
|
Profit before taxation
|
|
|
|
|
|
|
15,469
|
|
|
|
14,544
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expected income tax expense at statutory tax rate of 25%
|
|
|
(i)
|
|
|
|
3,867
|
|
|
|
3,636
|
|
Differential tax rate on PRC subsidiaries and branches income
|
|
|
(i)
|
|
|
|
(211
|
)
|
|
|
(185
|
)
|
Differential tax rate on other subsidiaries income
|
|
|
(ii)
|
|
|
|
(20
|
)
|
|
|
(16
|
)
|
Non-deductible expenses
|
|
|
(iii)
|
|
|
|
182
|
|
|
|
141
|
|
Non-taxable income
|
|
|
(iv)
|
|
|
|
(36
|
)
|
|
|
(39
|
)
|
Others
|
|
|
(v)
|
|
|
|
(35
|
)
|
|
|
(1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Actual income tax expense
|
|
|
|
|
|
|
3,747
|
|
|
|
3,536
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note:
(i)
|
Except for certain subsidiaries and branches which are mainly taxed at preferential rate of 15%, the provision for mainland China income tax is based on a statutory rate of 25% of the assessable income of the Company,
its mainland China subsidiaries and branches as determined in accordance with the relevant income tax rules and regulations of the PRC.
|
(ii)
|
Income tax provisions of the Companys subsidiaries in Hong Kong and Macau Special Administrative Regions of the PRC, and in other countries are based on the subsidiaries assessable income and income tax
rates applicable in the respective tax jurisdictions which range from 12% to 38%.
|
(iii)
|
Amounts represent miscellaneous expenses in excess of statutory deductible limits for tax purposes.
|
(iv)
|
Amounts represent miscellaneous income which are not subject to income tax.
|
(v)
|
Amounts primarily represent tax deduction on prior year research and development expenses, losses on disposal of property, plant and equipment approved by tax authorities and other tax benefits.
|
6.
|
BASIC EARNINGS PER SHARE
|
The calculation of basic earnings per share for the six-month
period ended 30 June 2016 and 2015 is based on the profit attributable to equity holders of the Company of RMB11,673 million and RMB10,980 million, respectively, divided by 80,932,368,321 shares.
The amount of diluted earnings per share is not presented as there were no dilutive potential ordinary shares in existence for the periods
presented.
A-16
Pursuant to the shareholders approval at the Annual General Meeting
held on 25 May 2016, a final dividend of RMB0.080182 (equivalent to HK$0.095) per share totaling RMB6,489 million in respect of the year ended 31 December 2015 was declared and paid on 15 July 2016.
Pursuant to the shareholders approval at the Annual General Meeting held on 27 May 2015, a final dividend of RMB0.076120 (equivalent
to HK$0.095) per share totaling RMB6,160 million in respect of the year ended 31 December 2014 was declared and paid on 17 July 2015.
The Board of Directors has resolved not to pay an interim dividend.
8.
|
DEFERRED TAX ASSETS AND LIABILITIES
|
The components of deferred tax assets and deferred
tax liabilities recognised in the consolidated statement of financial position and the movements are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets
|
|
|
Liabilities
|
|
|
Net Balance
|
|
|
|
30 June
2016
RMB
millions
|
|
|
31 December
2015
RMB
millions
|
|
|
30 June
2016
RMB
millions
|
|
|
31 December
2015
RMB
millions
|
|
|
30 June
2016
RMB
millions
|
|
|
31 December
2015
RMB
millions
|
|
Provisions and impairment losses, primarily for doubtful debts
|
|
|
1,590
|
|
|
|
1,291
|
|
|
|
|
|
|
|
|
|
|
|
1,590
|
|
|
|
1,291
|
|
Property, plant and equipment and others
|
|
|
2,957
|
|
|
|
3,174
|
|
|
|
(3,394
|
)
|
|
|
(1,605
|
)
|
|
|
(437
|
)
|
|
|
1,569
|
|
Deferred revenues and installation costs
|
|
|
154
|
|
|
|
190
|
|
|
|
(107
|
)
|
|
|
(130
|
)
|
|
|
47
|
|
|
|
60
|
|
Available-for-sale equity securities
|
|
|
|
|
|
|
|
|
|
|
(240
|
)
|
|
|
(326
|
)
|
|
|
(240
|
)
|
|
|
(326
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets/(liabilities)
|
|
|
4,701
|
|
|
|
4,655
|
|
|
|
(3,741
|
)
|
|
|
(2,061
|
)
|
|
|
960
|
|
|
|
2,594
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance at
1 January 2016
RMB millions
|
|
|
Recognised in
consolidated
statement of
comprehensive
income
RMB millions
|
|
|
Balance at
30 June 2016
RMB millions
|
|
Provisions and impairment losses, primarily for doubtful debts
|
|
|
1,291
|
|
|
|
299
|
|
|
|
1,590
|
|
Property, plant and equipment and others
|
|
|
1,569
|
|
|
|
(2,006
|
)
|
|
|
(437
|
)
|
Deferred revenues and installation costs
|
|
|
60
|
|
|
|
(13
|
)
|
|
|
47
|
|
Available-for-sale equity securities
|
|
|
(326
|
)
|
|
|
86
|
|
|
|
(240
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net deferred tax assets
|
|
|
2,594
|
|
|
|
(1,634
|
)
|
|
|
960
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
A-17
9.
|
ACCOUNTS RECEIVABLE, NET
|
Accounts receivable, net, are analysed as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 June 2016
|
|
|
31 December 2015
|
|
|
|
Note
|
|
|
RMB millions
|
|
|
RMB millions
|
|
Third parties
|
|
|
|
|
|
|
31,161
|
|
|
|
22,766
|
|
China Telecom Group
|
|
|
(i)
|
|
|
|
905
|
|
|
|
492
|
|
China Tower Corporation Limited
|
|
|
|
|
|
|
6
|
|
|
|
|
|
Other telecommunications operators in the PRC
|
|
|
|
|
|
|
1,204
|
|
|
|
782
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
33,276
|
|
|
|
24,040
|
|
Less: Allowance for doubtful debts
|
|
|
|
|
|
|
(4,199
|
)
|
|
|
(2,935
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
29,077
|
|
|
|
21,105
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Note:
(i)
|
China Telecommunications Corporation together with its subsidiaries other than the Group are referred to as China Telecom Group.
|
Ageing analysis of accounts receivable from telephone and Internet subscribers based on the billing dates is as follows:
|
|
|
|
|
|
|
|
|
|
|
30 June 2016
RMB millions
|
|
|
31 December 2015
RMB millions
|
|
Current, within 1 month
|
|
|
10,818
|
|
|
|
10,001
|
|
1 to 3 months
|
|
|
3,273
|
|
|
|
2,181
|
|
4 to 12 months
|
|
|
2,279
|
|
|
|
1,821
|
|
More than 12 months
|
|
|
1,574
|
|
|
|
731
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,944
|
|
|
|
14,734
|
|
Less: Allowance for doubtful debts
|
|
|
(3,548
|
)
|
|
|
(2,393
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
14,396
|
|
|
|
12,341
|
|
|
|
|
|
|
|
|
|
|
A-18
Ageing analysis of accounts receivable from other telecommunications operators and enterprise
customers based on dates of rendering of services is as follows:
|
|
|
|
|
|
|
|
|
|
|
30 June 2016
RMB millions
|
|
|
31 December 2015
RMB millions
|
|
Current, within 1 month
|
|
|
5,191
|
|
|
|
3,648
|
|
1 to 3 months
|
|
|
3,962
|
|
|
|
1,618
|
|
4 to 12 months
|
|
|
4,063
|
|
|
|
2,199
|
|
More than 12 months
|
|
|
2,116
|
|
|
|
1,841
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,332
|
|
|
|
9,306
|
|
Less: Allowance for doubtful debts
|
|
|
(651
|
)
|
|
|
(542
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
14,681
|
|
|
|
8,764
|
|
|
|
|
|
|
|
|
|
|
Accounts payable are analysed as follows:
|
|
|
|
|
|
|
|
|
|
|
30 June 2016
RMB millions
|
|
|
31 December 2015
RMB millions
|
|
Third parties
|
|
|
95,753
|
|
|
|
95,305
|
|
China Telecom Group
|
|
|
19,576
|
|
|
|
18,702
|
|
China Tower Corporation Limited
|
|
|
9,915
|
|
|
|
3,272
|
|
Other telecommunications operators in the PRC
|
|
|
868
|
|
|
|
776
|
|
|
|
|
|
|
|
|
|
|
|
|
|
126,112
|
|
|
|
118,055
|
|
|
|
|
|
|
|
|
|
|
Amounts due to China Telecom Group are payable in accordance with contractual terms which are similar to those
terms offered by third parties.
Ageing analysis of accounts payable based on the due dates is as follows:
|
|
|
|
|
|
|
|
|
|
|
30 June 2016
RMB millions
|
|
|
31 December 2015
RMB millions
|
|
Due within 1 month or on demand
|
|
|
26,964
|
|
|
|
21,486
|
|
Due after 1 month but within 3 months
|
|
|
19,991
|
|
|
|
18,624
|
|
Due after 3 months but within 6 months
|
|
|
22,667
|
|
|
|
19,430
|
|
Due after 6 months
|
|
|
56,490
|
|
|
|
58,515
|
|
|
|
|
|
|
|
|
|
|
|
|
|
126,112
|
|
|
|
118,055
|
|
|
|
|
|
|
|
|
|
|
A-19
MANAGEMENT DISCUSSION AND ANALYSIS
According to paragraph 40 of Appendix 16 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited (the Listing
Rules), save as disclosed herein, the Company confirms that the current company information in relation to those matters set out in paragraph 32 of Appendix 16 has not changed materially from the information disclosed in the Companys
2015 Annual Report.
PURCHASE, SALE OR REDEMPTION OF SECURITIES
During the six-month period ended 30 June 2016, neither the Company nor any of its subsidiaries has purchased, sold or redeemed any of the Companys
listed securities.
DIRECTORS AND SUPERVISORS INTERESTS AND SHORT POSITIONS IN SHARES, UNDERLYING SHARES AND DEBENTURES
As at 30 June 2016, none of the Directors or Supervisors of the Company had any interests or short positions in any shares, underlying shares of equity
derivatives or debentures of the Company or its associated corporations (as defined in Part XV of the Securities and Futures Ordinance (Chapter 571 of the laws of Hong Kong) (the SFO)) as recorded in the register required to be
maintained under Section 352 of the SFO or as otherwise notified to the Company and The Stock Exchange of Hong Kong Limited pursuant to the Model Code for Securities Transactions by Directors of Listed Issuers (the Model Code).
As at 30 June 2016, the Company has not granted its Directors or Supervisors, or their respective spouses or children below the age of 18 any rights to
subscribe for the shares or debentures of the Company or any of its associated corporations and none of them has ever exercised any such right to subscribe for the shares or debentures.
CHANGE OF DIRECTORS AND SUPERVISORS SINCE THE DATE OF THE 2015 ANNUA
L
REPORT
The changes in the information relating to the Directors and Supervisors since the date of the Companys 2015 Annual Report are set out below:
On 25 April 2016, the Executive Director of the Company, Mr. Yang Jie was appointed as the Chairman and Chief Executive Officer of the Company. On
the same day, he no longer held the offices of the President and Chief Operating Officer of the Company.
A-20
On 25 April 2016, the Executive Director of the Company, Mr. Yang Xiaowei was appointed as the
President and Chief Operating Officer of the Company. On the same day, he no longer held the office of the Executive Vice President of the Company.
On
10 May 2016, Mr. Zhu Wei resigned from his position as a Non-Executive Director of the Company due to change in work arrangement.
On
19 August 2016, Mr. Zhang Jiping retired from his positions as an Executive Director and Executive Vice President of the Company due to his age.
Save as stated above, there is no other information of the Directors or Supervisors of the Company required to be disclosed pursuant to Rule 13.51B(1)
of the Listing Rules. The updated biographical details of the Directors and Supervisors are available on the website of the Company (
www.chinatelecom-h.com
).
AUDIT COMMITTEE
The audit committee has reviewed with
management and the Companys international auditor, Deloitte Touche Tohmatsu, the accounting principles and practices adopted by the Group and discussed internal control and financial reporting matters including the review of the Companys
Interim Report for the six months ended 30 June 2016.
COMPLIANCE WITH THE CORPORATE GOVERNANCE CODE
The Company attaches great importance to corporate governance. We continued to make efforts in improving the Companys internal control mechanisms,
strengthening information disclosure and enhancing the Companys transparency, developing corporate governance practices and protecting shareholders interests to the maximum degree.
The roles of Chairman and Chief Executive Officer of the Company were performed by the same individual, for the six-month period ended 30 June 2016. In
the Companys opinion, through supervision of the Board of Directors and Independent Non-Executive Directors, and effective control of the Companys internal check and balance mechanism, the same individual performing the roles of Chairman
and Chief Executive Officer can achieve the goal of improving the Companys efficiency in decision-making and execution and effectively capture business opportunities. Many international leading corporations also have a similar arrangement.
A-21
Save as stated above, the Company has been in compliance with all the code provisions under the Corporate
Governance Code as set out in Appendix 14 of the Listing Rules throughout the six-month period ended 30 June 2016.
COMPLIANCE WITH THE MODEL CODE
FOR SECURITIES TRANSACTIONS BY DIRECTORS AND SUPERVISORS
The Company has adopted the Model Code as set out in Appendix 10 of the Listing Rules to
govern securities transactions by Directors and Supervisors. Further to the specific enquiries made by the Company to Directors and Supervisors, they have confirmed their compliance with the Model Code throughout the period from 1 January 2016
to 30 June 2016.
INTERIM REPORT
The
Interim Report for the six months ended 30 June 2016 will be despatched to shareholders and made available on the website of The Stock Exchange of Hong Kong Limited (
www.hkexnews.hk
) and the website of the Company
(
www.chinatelecom-h.com
) in due course.
FORWARD-LOOKING STATEMENTS
Certain statements contained in this announcement may be viewed as forward-looking statements within the meaning of Section 27A of the U.S.
Securities Act of 1933 (as amended) and Section 21E of the U.S. Securities Exchange Act of 1934 (as amended). Such forward-looking statements are subject to known and unknown risks, uncertainties and other factors, which may cause the actual
performance, financial condition or results of operations of the Company to be materially different from any future performance, financial condition or results of operations implied by such forward-looking statements. In addition, we do not intend
to update these forward-looking statements. Further information regarding these risks, uncertainties and other factors is included in the Companys most recent Annual Report on Form 20-F filed with the U.S. Securities and Exchange Commission
(the SEC) and in the Companys other filings with the SEC.
As at the date of this announcement, the Board of Directors of the Company
consists of Mr. Yang Jie (as the chairman and chief executive officer); Mr. Yang Xiaowei (as the president and chief operating officer); Mr. Sun Kangmin and Mr. Ke Ruiwen (all as the executive vice presidents); Mr. Tse Hau
Yin, Aloysius, Madam Cha May Lung, Laura, Mr. Xu Erming and Madam Wang Hsuehming (all as the independent non-executive directors).
A-22