Hong Kong’s i-Cable reports wider loss due to lower ad budgets, keen competition
Internet and television service provider i-Cable Communications reported a wider loss in the first half of the year, as Hong Kong’s weak consumer business environment cut advertising revenues.
Its net loss for the six months to the end of June widened to HK$135 million, or 6.7 HK cents per share, from a loss of HK$121 million a year earlier, according to a company announcement filed to the stock exchange on Tuesday.
i-Cable, a subsidiary of Hong Kong property developer The Wharf (Holdings), said its television revenue decreased by 8 per cent to HK$526 million on lower pay-TV subscriptions and advertising income, while its internet and multimedia revenue dropped by 3 per cent to HK$168 million.
i-Cable’s share price lost 1.19 per cent to 83 HK cents on Monday. The stock has risen 68 per cent this year. The Hong Kong stock market was closed on Tuesday due to a typhoon.
“The Hong Kong economy slowed further in the first half of 2016 and the local advertising market was weak due to sluggish consumer business,” the company said in the results announcement.
“The group’s financial performance was affected by the decline of advertising and subscription revenues despite our efforts on cost control.”
The Hong Kong government issued a licence to i-Cable in May to run its free-to-air network Fantastic Television up to 2028, making it the third free TV service provider after TVB and PCCW.
Fantastic TV is scheduled to launch a Cantonese channel by May 2017, which the company says will enhance its overall competitiveness.
Competition in Hong Kong’s television industry has intensified since PCCW’s Viu TV rolled out its Cantonese channel in April, shortly after ATV went off air, ending its 59-year run as the oldest Chinese-language broadcaster.
TV operators also face threats from online content providers including Beijing-based LeEco and Netflix, which entered the Hong Kong market in January.