Release Date: October 31, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- EBITDA increased by 12% in the second half and 6% year-on-year, excluding handset revenue.
- AFF increased by 27% year-on-year, with dividends representing around a 10% yield.
- Enterprise revenue increased by 1%, with a 15% increase in backlog or booking.
- Successful integration of SI and telecom business, leading to better services and products.
- Strong cash flow with a cash conversion rate of 96-97% and a 20% increase in cash on hand.
Negative Points
- Overall revenue was flat or decreased by 1% year-on-year.
- Residential service revenue dropped by 2% due to defocusing on two mobile operators as resellers.
- High interest rate environment poses challenges to the overall economy.
- Shareholders' funds fell from $3 billion to $2.5 billion.
- Gearing slightly increased despite improvements in net leverage.
Q & A Highlights
Q: Can you provide insights on when the revenue growth will catch up with the backlog in the enterprise business?
A: William Yeung, CEO, explained that the time from order to revenue will be shorter due to initiatives on cost control and revenue increase. CFO Chung Ting Yue added that the strong EBITDA growth in the second half is due to improved execution and digital transformations.
Q: What is your strategic plan to drive further growth?
A: William Yeung, CEO, stated that HKBN plans to increase product offerings and enhance value for customers with slight fee increases. The company is also upgrading its human resources to improve execution.
Q: Can you discuss the CapEx plans for 2025 and why it dropped significantly?
A: CFO Chung Ting Yue mentioned that the CapEx drop was due to timing differences and strategic vendor payment terms. The company will continue to invest selectively in key areas, returning to normal investment levels.
Q: What is the status of your refinancing efforts, given the upcoming loan maturities?
A: CFO Chung Ting Yue confirmed that refinancing is on track with strong support from relationship banks. The company is confident about the progress and mandate of the refinancing exercise.
Q: How do you balance improving ARPU with maintaining stable revenue in the residential business?
A: William Yeung, CEO, emphasized focusing on core channels and leveraging the gigafast network as a competitive edge. CFO Chung Ting Yue added that moving away from reselling businesses enhances EBITDA growth, even if not immediately visible in top-line revenue.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
