HKBN (1310) H1 2025 earnings summary

Executive summary

• EBITDA increased 5% year-over-year to $1,206 million, driven by operational efficiencies, GigaFast broadband, and strong enterprise and residential performance.

• Net profit surged to $108 million from $1.5 million, reflecting improved cost controls and lower finance costs.

• Revenue excluding handsets rose 4%, but total revenue declined 1% year-over-year to $5,734 million due to weaker handset and product sales.

• Strategic partnerships in AI, cloud, and cybersecurity, and the launch of the InnoTech Ecosystem Alliance, position the group for future growth.

• Dividend per share declared at 15.5 cents, up from 15 cents last year.

Financial highlights

• Enterprise Solutions revenue grew 10% year-over-year to $2,550 million; Residential Solutions revenue dipped 1% to $1,166 million.

• Handset and other product revenue fell 17% year-over-year.

• Adjusted free cash flow increased 2% year-over-year to $126 million; cash and equivalents up 34% to over $1 billion.

• Finance costs declined 9% to $366 million, aided by lower interest rates and swap gains.

• Basic EPS rose to 8.2 cents from 0.1 cents year-over-year.

Outlook and guidance

• Targeting continued EBITDA growth above 5% for the long term, with a focus on innovation, digital transformation, and expanding Infinite-Play and GigaFast offerings.

• Partnerships in AI, cloud, and data center services are expected to drive enterprise growth, especially with increased cross-border business activity.

• Interest rate reductions and recent debt refinancing are expected to lower future financing costs.

• Confident in sustainable growth due to a utility-like, recession-resistant business model and minimal exposure to geopolitical or trade war risks.

• Ongoing commitment to sustainability, with a $6.75 billion sustainability-linked loan and science-based climate targets.