China Unicom

Telecoms investment surge boosts Beijing firm

PUBLISHED : Wednesday, 15 February, 2012, 12:00am
UPDATED : Wednesday, 15 February, 2012, 12:00am


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A new wave of investments by mainland telecommunications network operators is expected to boost sales this year for AsiaInfo-Linkage, the biggest information-technology services and software provider to the domestic telecoms industry.

The Beijing-based company's upbeat outlook followed its report yesterday that fourth-quarter net income fell 32 per cent to US$10.5 million, down from US$15.5 million a year earlier, due largely to higher employee compensation and increased hiring of engineers.

Revenue in the quarter to December rose 14.6 per cent to US$131.1 million from US$114.4 million the previous year. Total sales last year grew 40.1 per cent to US$481 million.

'This year, China's telecoms carriers will continue to invest heavily in traditional management services like billing, customer relationship management and business intelligence, while also seeking to enhance their application platform and network infrastructure,' said Steve Zhang, the president and chief executive at Nasdaq-listed AsiaInfo-Linkage. 'We anticipate contract wins related to these growth areas in 2012. At the same time, we will continue to invest in overseas expansion and in our cable business.'

Zhang said the company's three core customers - China Mobile, China Unicom and China Telecom - 'look to differentiate themselves [against one another], gain loyal subscribers and monetise [convert into revenue] their data traffic'.

AsiaInfo-Linkage expects its revenue this first quarter to range between US$119 million and US$121 million.

The company did not provide a full-year's earnings guidance for 2012 because a special committee formed by its board is considering a buyout proposal it received last month from Power Joy (Cayman), a subsidiary of state-owned private equity fund CITIC Capital China Partners II.