CHINA TOWER (788) H1 2024 earnings summary

Executive summary

• Operating revenue for H1 2024 reached RMB48,247 million, up 3.8% year-over-year, with net profit attributable to owners at RMB5,330 million, up 10.1% year-over-year, and EBITDA at RMB33,045 million, up 3.2% year-over-year.

• Cash flow from operating activities surged to RMB32,830 million, and free cash flow reached RMB19,101 million, both showing significant year-over-year improvement.

• Advanced the One Core and Two Wings strategy, driving steady business development and rapid growth in Smart Tower and Energy businesses.

• Interim dividend of RMB0.01090 per share (pre-tax) proposed for the first time; full-year payout ratio to be at least 75% of annual distributable net profit.

• Enhanced digital transformation and ESG initiatives, with significant patent growth and carbon emissions reduction.

Financial highlights

• Operating revenue: RMB48,247 million (+3.8% YoY); TSP business: RMB42,121 million (+3.0% YoY); Smart Tower: RMB3,982 million (+17.6% YoY); Energy: RMB2,023 million (+2.4% YoY).

• Net profit: RMB5,330 million (+10.1% YoY); EBITDA: RMB33,045 million (+3.2% YoY); EBITDA margin: 68.5%; net profit margin: 11.0%.

• Operating expenses: RMB40,101 million (+2.7% YoY); depreciation and amortization: RMB24,899 million (+1.2% YoY).

• Net cash from operating activities: RMB32,830 million (+RMB21,275 million YoY); free cash flow: RMB19,101 million (+RMB20,368 million YoY).

• Capital expenditures: RMB13,729 million (+7.1% YoY); gearing ratio: 29.4% (down 2.0pp from end-2023); liabilities to assets ratio: 38.0%.

Outlook and guidance

• Focus on leveraging 5G-A, Dual-Gigabit, and broadband expansion to drive TSP business growth and maintain market leadership.

• Smart Tower business to emphasize digital-intelligence governance, platform and AI capabilities, and expansion into emerging industries.

• Energy business to refine battery exchange network, expand customer base, and explore green energy and energy storage services.

• Commitment to technological innovation and transformation to support high-quality development of core and new businesses.

• Board recommended an interim dividend of RMB0.0109 per share; full-year payout ratio to be at least 75% of last year.