China Mobile to pay special dividend amid steady revenue, profit growth

World’s largest wireless network operator, with 867 million subscribers as of June 30, marks the 20th anniversary of its public listing in Hong Kong.

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Students looking at their smartphones during a class at the Yiwu Industrial & Commercial College in Yiwu, east China's Zhejiang Province. Hordes of Chinese millennials are speaking directly to the country's 700 million smartphone users, streaming their lives to lucrative effect, fronting brands and launching businesses. They are known as "wanghong" -- literally hot on the web -- and they now represent a multi-billion-dollar industry, becoming so big that it has its own university curriculum. At Yiwu Industrial & Commercial College, classrooms for the 34 mostly female students are typically dance studios, catwalks strafed by flashing lights, and bustling makeup rooms. Photo: AFP

Published: 3:45pm, 10 Aug 2017Updated: 11:28pm, 10 Aug 2017

China Mobile, the world’s largest wireless network operator by subscribers, surprised the market on Thursday by announcing a special dividend after reporting stable interim earnings growth.

Chairman Shang Bing said in a regulatory filing that the China Mobile board will pay a one-off special dividend of HK$3.20 per share to mark the 20th anniversary of its public listing in Hong Kong.

China Mobile was incorporated in Hong Kong on September 3, 1997. It was listed on the New York Stock Exchange on October 22, 1997 and in Hong Kong the following day.

Its special cash dividend, the first for the company since 2008, was in addition to the regular interim dividend of HK$1.62 per share, representing a dividend payout ratio of 46 per cent.

“The announcement of a special dividend is likely a measure to support its share price ahead of a much worse second-half outlook this year, driven by a price war, government-mandated tariff cuts and upward pressure on capital expenditure,” Jefferies equity analyst Edison Lee said.

Shares of China Mobile jumped as much as 5.9 per cent to an intraday high of HK$89.60 in Hong Kong before closing at HK$87, up 2.8 per cent.

Mobile-phone social network users and penetration in China ■ Mobile-phone social % of social —network users (million) network users 700 600 500 400 300 200 100 2016 2017 2018 2019 2020 2021 87 85 83 81 79 77 75 Source: eMarketer/SCMP

The operator’s first-half net profit rose 3.5 per cent to 62.7 billion yuan (US$9.4 billion), up from 60.6 billion yuan in the same period last year, on the back of a 6.9 per cent growth in telecommunications services revenue.

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