Cellular operator SmarTone Telecommunications Holdings says it is getting close to overtaking Hongkong Telecom CSL's traditional dominance of the mobile telephone market. SmarTone yesterday said it had won more than 340,000 subscribers. CSL last month said it had 350,000. The claim, in what is an increasingly competitive market, accompanied the release of SmarTone's first interim results since listing in October last year. Attributable profit rose 67 per cent to $318.7 million in the six months to December, up from $191.2 million in the previous corresponding period. Turnover rose 102 per cent to $1.41 billion. As outlined in its prospectus, no interim dividend was declared. Earnings per share rose to 66.4 cents from 39.85 cents. Chief executive Hubert Ng Ching-wah, who was managing director at Hongkong Telecom CSL before defecting to SmarTone in April, said nearly half of all the new subscribers in the second half of last year opted for SmarTone. 'We plan to spend $1 billion expanding capacity this year,' he said. 'I'm hoping we will need to expand to accommodate more than 400,000 customers by July.' The market is far from being a two-horse race, with Hutchison Telecom chasing hard with about 320,000 customers. 'We have outperformed our targets in terms of subscribers, transmission sites, revenue per subscriber and profit,' Mr Ng said. Average monthly revenue per subscriber - a key factor in cellular profitability - rose in the final quarter of the year to $595, compared with $581 in the previous three months. Mr Ng said this was because customers were showing increasing interest in using value-added services such as the ability to roam with their telephones into China. Despite the belief among many industry observers that monthly revenues would fall with increasing competition, Mr Ng said the company would be able to sustain this level or improve it as more customers used extra services. He said SmarTone would become more aggressive and intended to target high-usage groups. High-volume business customers formed the core of Hongkong Telecom's CSL subscriber base. The competition is hotting up quickly. Two more personal communications service (PCS) networks are due to launch this month in addition to People's Telephone PCS service which started in January. Hutchison last week relaunched its network with big price cuts designed to appeal to younger customers. Fears about the effect of this heightened competition on future profit growth have made SmarTone's shares poor performers since their listing.