PCCW announced last week its second annual profit decline in the past three years, but a steady increase in core revenue may signal that better days are ahead for the communications giant.
The company's core businesses of telecommunications services, television content, mobile subscriptions and data outsourcing altogether recorded nearly an 8 per cent increase in revenue last year. And the earnings before interest and assorted deductions for those segments were less than 1 per cent off the mark from what they were in 2007.
Overall net profit slid sharply last year, however, dropping 15.37 per cent to HK$1.27 billion from HK$1.5 billion the previous year. But the company was saddled with HK$464 million in one-off losses stemming from revaluations and impairments on investments. Only HK$3 million of such losses were taken in 2007.
'Going forward, they will not suffer these losses,' said Francis Lun Sheung-nim, a general manager at Fulbright Securities.
'Actually for the [media and telecom unit], the future is not that bad because they went through the worst of the restructuring and they are actually gaining market share at the expense of Hutchison Telecom and New World Telecom.'
On the brink of going private just a few days ago, PCCW will retain its listing for the foreseeable future after the Court of Appeal unanimously overturned a decision that had given approval to the buyout bid. Analysts are now scrambling to interpret the latest twist in the company's affairs and assess its future financial prospects.
PCCW may have a strong edge on the local competition.
