FAQs
For the first quarter of 2017, the Company had solid performance in its overall results with steady enhancement in operating revenues and net profits. The operating revenues were RMB91,428 million, representing an increase of 5.8% over the same period of last year; of which the service revenues were RMB82,094 million, representing an increase of 7.5% over the same period of last year. The profit attributable to equity holders of the Company was RMB5,348 million, representing an increase of 4.5% over the same period of last year. EBITDA was RMB24,815 million, representing an increase of 4.2% over the same period of last year. EBITDA margin (calculated based on EBITDA divided by service revenues) was 30.2%.
For the first quarter of 2017, facing the increasingly intensified market competition, the Company increased efforts in “New Convergence” development and firmly seized the terminal benefits from “6-mode multi-mode” to optimise the data traffic operation strategies and persistently accelerate the users to upgrade their service from 3G to 4G, resulting in remarkable enhancement in scale and values of mobile business. The number of mobile subscribers reached approximately 222 million, representing a net addition of 6.53 million; of which the number of 4G terminal users reached 138 million, representing a net addition of 15.77 million.
For the first quarter of 2017, the handset data traffic increased by 115% over the same period of last year and continued to maintain rapid growth. The monthly average data traffic per 4G user reached 1,271 MB while the average mobile service revenue per user per month (ARPU) increased steadily.
The Company continued to deepen the integration of Fibre-to-the-Home (FTTH) and “Smart Family” products and fully promoted the rapid growth of emerging businesses including IDC, cloud, Big Data and e-Surfing HD. For the first quarter of 2017, the wireline services achieved healthy growth momentum in overall development. The wireline broadband subscribers reached 126 million, representing a net addition of 2.70 million; of which FTTH subscribers reached 112 million, representing a net addition of 6.07 million. The net addition of e-Surfing HD subscribers was 6.26 million, reaching a total of 67.59 million.
In 2016, with persistent and unwavering determination in innovation and integration and leveraging the advantages of its own strengths and resources endowment, the Company internally strengthened efficiently-centralised integration while externally expanded open cooperation, resulting in accelerated expansion in growth potential of new emerging businesses. With rapid breakthrough in the scale of e-Surfing HD, the revenues for the year increased by 24% over last year. The net increase of e-Surfing HD subscribers was 20.95 million, reaching a total of 61.33 million. The number of average monthly active users of "BestPay" increased more than 3 times over last year. The gross merchandise value of "BestPay" for the year increased by approximately 30% over last year, exceeding RMB1 trillion. Internet of Things (IoT) business was rapidly developed, achieving efficient centralisation for the entire network. The net increase of IoT connected devices for the year was 13.21 million. Cloud and Big Data business maintained rapid development momentum. The revenues of cloud and Big Data business for the year increased by 55% over last year. The "Internet+" business achieved scale expansion with remarkable strengthening of the influences in the areas including government administration, education, health and medical care and industrial Internet.
Taking into consideration the return to shareholders, the Company's profitability, cash flow level and capital requirements for its future development, the Board of Directors has decided to recommend at the forthcoming shareholders' meeting to appropriately increase the dividend level, that a dividend equivalent to HK$0.105 per share for the year 2016 to be declared.

Total CAPEX in 2016 was RMB96.8 billion, decreased by 11% year-over-year. In 2016, CAPEX continued to tilt towards rapidly expanding 4G & fibre broadband businesses, optimizing CAPEX structure and achieving precision investment to consolidate our network edge and support business growth. As a result of the 800MHz refarm, mobile network spending as a percentage of total CAPEX declined by 4.4 year-over-year. As at end 2016, the number of 4G base stations reached 890k, an increase of 380k in the year, representing an extra of 90k versus our plan at the beginning of the year. The Company's 4G network coverage reached 95% of population , with 4G+ deployment completed in all cities nationwide. Share of Broadband & Internet increased by 3.6pp year-over-year. In response to the strong market demand for high bandwidth access, the Company advanced investment in broadband network appropriately to maintain our network and service edges. To get prepared for future development, the Company increased appropriately the investment in five ecospheres to support and lay network foundation supporting business development. As a result, Information & Application Services as a percentage of total CAPEX increased by 1.8pp year-over-year.

CAPEX for 2017 is budgeted at RMB89 billion, further decrease by 8% year-over-year. Of which the share of 4G and fibre broadband will further reduce to 73%. Meanwhile, the Company will continue to increase CAPEX spending in emerging business appropriately.
As at the end of 2016, China Telecom leased around 610k towers from the Tower Company, representing an addition of 110k for the year. Sharing ratio of the newly leased towers was above 90% while the overall sharing ratio of all leased tower was around 66%.

The Company jointly promoted industry development with China Unicom, successfully promoting 6-mode all-frequencies compatible handsets to become national standard. Jointly announced "Broadband Services White Paper" and "4K TV Smart Set-top Box (STB) White Paper. We cooperated in network co-build and sharing for CAPEX and cost saving: in terms of mobile network, we formulated projects for sharing of about 70k 4G base stations; for transmission network, we have formulated projects for sharing of around 16,000km transmission fibre cables.
In 2016, the Company rose to the challenge and continued the implementation of "Speed Upgrade and Tariff Reduction", in turn encouraged mobile data usage and bandwidth upgrade among subscribers. In 2016, handset data unit price declined by 38% year-over-year, boosted handset data traffic and internet access revenue to surge by 130% and 43% year-over-year respectively; Wireline broadband unit price declined by 50% year-over-year, driving average access bandwidth and wireline broadband revenue increased by 72% and 3.3% year-over-year respectively.

Last updated on 9 May 2017