PCCW sees strong growth of media business in the second half

Subscriber numbers up on back of broadcast rights, as first-half profit beats expectations

PUBLISHED : Wednesday, 07 August, 2013, 12:00am
UPDATED : Wednesday, 07 August, 2013, 4:42am

PCCW, which saw its consolidated net profit rise 2 per cent in the first half, expects the return of English Premier League football matches on Now TV this month to step up growth in its media business.

George Chan Ching-cheong, PCCW's group managing director, yesterday described Now TV's exclusive broadcast rights to those league matches for three seasons as "a catalyst", which has led to new customers signing up and existing users upgrading to its higher value "Super Sports Pack" programming since the start of the year.

"We expect this momentum to accelerate in the second half of the year as the new English Premier League season kicks off," Chan said.

PCCW, which is controlled by media and telecommunications mogul Richard Li Tzar-kai, yesterday reported that its consolidated net profit reached HK$856 million in the first half, up from HK$836 million a year ago, on the back of solid growth from its core media, information-technology services and telecommunications businesses.

That better-than-expected performance blew away last month's estimate by Barclays of a 12.6 per cent year-on-year fall in consolidated net profit to HK$731 million.

PCCW's core earnings before interest, tax, depreciation and amortisation - a measure of operating profitability - climbed 7 per cent to HK$3.94 billion from HK$3.67 billion.

Core revenue increased 16 per cent to HK$12.82 billion from HK$11.06 billion. Consolidated revenue, which includes turnover from property and investment arm Pacific Century Premium Developments, rose 12 per cent to HK$13.31 billion from HK$11.91 billion.

Earnings per share rose to 11.79 HK cents from 11.51 HK cents. Directors recommended an interim dividend of 6.35 HK cents per ordinary share, compared with 5.51 HK cents in the year-ago period.

HKT Trust and operating arm HKT, the listed telecommunications assets of PCCW, on Monday reported a strong 14 per cent increase in first-half revenue to HK$11.07 billion from HK$9.72 billion a year earlier.

PCCW's media business, led by Now TV, improved its first-half revenue by 3 per cent to HK$1.3 billion from HK$1.26 billion.

Now TV added 39,000 subscribers at the end of June to swell its installed subscriber base to 1.204 million, while arpu (monthly average revenue per user numbers) rose to HK$174 from HK$172 a year earlier.

First-half revenue at PCCW Solutions, the information-technology services division, posted a solid 24 per cent increase to HK$1.39 billion from HK$1.13 billion in the previous year.

Shares of PCCW advanced 0.56 per cent to close at HK$3.58 yesterday.