China Telecom Corporation (728) H2 2024 earnings summary

Executive summary

• Operating revenues reached RMB529.4 billion, up 3.1% year-over-year; service revenues rose 3.7% to RMB482.0 billion, both surpassing industry averages.

• Net profit increased 8.4% year-over-year to RMB33.0 billion; basic EPS was RMB0.36.

• Advanced cloud, AI, and quantum technology initiatives, including the launch of the Xirang intelligent computing platform and major breakthroughs in proprietary technologies.

• Maintained industry-leading customer satisfaction, deepened reforms, and prioritized social responsibility and shareholder returns, with increased dividends and CSR recognition.

• Strategic emerging businesses and Industrial Digitalisation drove growth, with cloud, security, and AI services expanding rapidly.

Financial highlights

• Service revenues up 3.7% to RMB482.0 billion; operating revenues up 3.1% to RMB529.4 billion.

• Net profit rose 8.4% to RMB33.0 billion; EBITDA increased 2.9% to RMB140.8 billion.

• Free cash flow surged 70.7% to RMB22.2 billion.

• Dividend per share increased 11.4% to RMB0.2598; payout ratio reached 72%, with a proposed final dividend of RMB0.0927 per share.

• Net profit margin improved by 0.3p.p. to 6.8%; EPS up 8.4%.

Outlook and guidance

• Targets for 2025 include continued healthy growth in service revenues, EBITDA, and net profit.

• Intelligent revenue expected to see rapid growth, with a focus on cloudification, digital transformation, and AI+ initiatives.

• Plans rapid growth in intelligent revenue and further CapEx optimization, with 2025 CapEx planned at RMB83.6 billion, down 10.6%.

• Cash dividend payout ratio to gradually increase to over 75% within three years.