e6vk
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16 of
the Securities Exchange Act of 1934
For the Month of April 2011
Commission File Number 1-15028
China Unicom (Hong Kong) Limited
(Exact Name of Registrant as Specified in Its Charter)
75/F, The Center,
99 Queens Road Central, Hong Kong
(Address of principal executive offices)
(Indicate by check mark whether the registrant files or will file annual reports under cover
of Form 20-F or Form 40-F.)
Form 20-F þ Form 40-F o
(Indicate by check mark if the registrant is submitting the Form 6-K on paper as permitted by Regulation S-T Rule 101(b)(1): o)
(Indicate by check mark if the registrant is submitting the Form 6-K on paper as permitted by Regulation S-T Rule 101(b)(7): o)
(Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
Yes o No þ
(If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):82- .)
TABLE OF CONTENTS
EXHIBITS
Exhibit Number
FORWARD-LOOKING STATEMENTS
This announcement contains certain forward-looking statements within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Such forward-looking statements may include, without limitation, statements relating to
the Companys competitive position; the Companys business strategies and plans, including those
relating to the Companys networks, services, products, as well as sales and marketing, in
particular, such networks, services, products, sales and marketing in respect of the Companys 3G
business; the Companys future business condition, future financial results, cash flows, financing
plans and dividends; the future growth of market demand of, and opportunities for, the Companys
new and existing products and services, in particular, 3G services; and future regulatory and other
developments in the PRC telecommunications industry.
The words anticipate, believe, could, estimate, intend, may, seek, will and similar
expressions, as they relate to us, are intended to identify certain of these forward-looking
statements. The Company does not intend to update any of these forward-looking statements.
The forward-looking statements contained in this announcement are, by their nature, subject to
significant risks and uncertainties. In addition, these forward-looking statements reflect the
Companys current views with respect to future events and are not a guarantee of the Companys
future performance. Actual results may differ materially from those expressed or implied in the
forward-looking statements as a result of a number of factors, including, without limitation:
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changes in the regulatory regime and policies for the PRC telecommunications industry,
including changes in the regulatory policies of the Ministry of Industry and Information
Technology, or the MIIT, the State-owned Assets Supervision and Administration Commission, and
other relevant government authorities of the PRC; |
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changes in the PRC telecommunications industry resulting from the issuance of 3G licenses
by the central government of the PRC; |
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effects of tariff reduction and other policy initiatives from the relevant PRC government
authorities; |
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changes in telecommunications and related technologies and applications based on such
technologies; |
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the level of demand for telecommunications services, in particular, 3G services; |
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competitive forces from more liberalized markets and the Companys ability to retain market
share in the face of competition from existing telecommunications companies and potential new
market entrants; |
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effects of competition on the demand and price of the Companys telecommunications
services; |
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the availability, terms and deployment of capital and the impact of regulatory and
competitive developments on capital outlays; |
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effects of the Companys restructuring and integration following the completion of the
Companys merger with China Netcom Group Corporation (Hong Kong) Limited; |
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effects of the Companys adjustments in its business strategies relating to the personal
handyphone system, or PHS, business; |
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effects of the Companys acquisition from its parent companies of certain
telecommunications business and assets, including the fixed-line business in 21 provinces in
southern China, in January 2009; |
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changes in the assumptions upon which the Company have prepared its projected financial
information and capital expenditure plans; |
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changes in the political, economic, legal and social conditions in the PRC, including the
PRC Governments policies and initiatives with respect to economic development in light of the
recent global economic downturn, foreign exchange policies, foreign investment activities and
policies, entry by foreign companies into the PRC telecommunications market and structural
changes in the PRC telecommunications industry; and |
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the recovery from the recent global economic downturn inside and outside the PRC. |
Please also see the Risk Factors section of the Companys latest Annual Report on Form 20-F, as
filed with the U.S. Securities and Exchange Commission.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
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CHINA UNICOM (HONG KONG) LIMITED |
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(Registrant) |
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Date: 27 April, 2011
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By: |
/s/ Chang Xiaobing
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Name: |
Chang Xiaobing |
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Title: |
Chairman and Chief Executive Officer |
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Exhibit 1
Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no
responsibility for the contents of this announcement, make no representation as to its accuracy or
completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or
in reliance upon the whole or any part of the contents of this announcement.
(incorporated in Hong Kong with limited liability)
(Stock Code: 0762)
ANNOUNCEMENT
The Board of the Company is pleased to announce the unaudited condensed
consolidated results of the Group for the three months ended 31 March 2011.
GROUP RESULTS
China Unicom (Hong Kong) Limited (the Company) is pleased to announce the unaudited condensed
consolidated results of the Company and its subsidiaries (the Group) for the three months ended
31 March 2011.
1
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2011
(All amounts in Renminbi (RMB) millions)
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31 December |
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2010 |
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31 March |
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As restated |
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Note |
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2011 |
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(Note 2(a)) |
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ASSETS |
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Non-current assets |
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Property, plant and equipment |
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355,566 |
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366,060 |
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Lease prepayments |
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7,591 |
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7,607 |
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Goodwill |
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2,771 |
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2,771 |
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Deferred income tax assets |
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4,649 |
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4,840 |
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Financial assets at fair value through
other comprehensive income/loss |
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2(a) |
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10,377 |
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6,214 |
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Other assets |
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11,611 |
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11,753 |
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392,565 |
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399,245 |
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Current assets |
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Inventories and consumables |
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4,294 |
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3,728 |
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Accounts receivable, net |
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9,816 |
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9,286 |
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Prepayments and other current assets |
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7,327 |
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5,115 |
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Amounts due from related parties |
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50 |
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50 |
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Amounts due from domestic carriers |
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1,377 |
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1,261 |
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Short-term bank deposits |
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268 |
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273 |
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Cash and cash equivalents |
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24,649 |
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22,495 |
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47,781 |
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42,208 |
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Total assets |
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440,346 |
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441,453 |
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EQUITY |
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Equity attributable to owners of the parent |
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Share capital |
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2,310 |
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2,310 |
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Share premium |
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173,436 |
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173,436 |
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Reserves |
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(17,675 |
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(18,273 |
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Retained profits |
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Proposed 2010 final dividend |
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1,885 |
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1,885 |
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Others |
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46,647 |
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46,483 |
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Total equity |
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206,603 |
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205,841 |
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2
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31 December |
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2010 |
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31 March |
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As restated |
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Note |
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2011 |
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(Note 2(a)) |
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LIABILITIES |
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Non-current liabilities |
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Long-term bank loans |
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1,469 |
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1,462 |
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Promissory notes |
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15,000 |
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15,000 |
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Convertible bonds |
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11,496 |
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11,558 |
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Corporate bonds |
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7,000 |
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7,000 |
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Deferred income tax liabilities |
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64 |
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22 |
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Deferred revenue |
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2,092 |
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2,171 |
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Other obligations |
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168 |
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162 |
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37,289 |
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37,375 |
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Current liabilities |
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Accounts payables and accrued liabilities |
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87,184 |
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97,659 |
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Taxes payable |
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1,382 |
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1,484 |
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Amounts due to ultimate holding company |
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257 |
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229 |
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Amounts due to related parties |
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4,868 |
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5,191 |
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Amounts due to domestic carriers |
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1,022 |
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873 |
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Commercial papers |
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24,000 |
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23,000 |
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Short-term bank loans |
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41,165 |
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36,727 |
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Current portion of long-term bank loans |
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53 |
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58 |
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Dividend payable |
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407 |
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431 |
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Current portion of deferred revenue |
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1,024 |
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1,042 |
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Current portion of other obligations |
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2,630 |
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2,637 |
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Advances from customers |
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32,462 |
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28,906 |
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196,454 |
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198,237 |
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Total liabilities |
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233,743 |
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235,612 |
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Total equity and liabilities |
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440,346 |
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441,453 |
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Net current liabilities |
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(148,673 |
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(156,029 |
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Total assets less current liabilities |
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243,892 |
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243,216 |
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3
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF INCOME
FOR THE THREE MONTHS ENDED 31 MARCH 2011
(All amounts in RMB millions, except per share data)
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Three months ended 31 March |
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2010 |
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As restated |
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Note |
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2011 |
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(Note 2(b)) |
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Revenue |
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49,026 |
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40,522 |
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Interconnection charges |
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(3,673 |
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(3,080 |
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Depreciation and amortisation |
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(14,057 |
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(13,168 |
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Networks, operations and support expenses |
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(6,835 |
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(6,228 |
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Employee benefit expenses |
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(6,264 |
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(5,767 |
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Other operating expenses |
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(17,553 |
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(10,290 |
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Finance costs |
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(536 |
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(464 |
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Interest income |
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59 |
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18 |
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Other income net |
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66 |
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44 |
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Profit before income tax |
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233 |
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1,587 |
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Income tax expenses |
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(67 |
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(378 |
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Profit for the period |
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166 |
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1,209 |
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Profit attributable to: |
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Owners of the parent |
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166 |
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1,209 |
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Basic earnings per share (in RMB) |
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4 |
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0.01 |
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0.05 |
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Diluted earnings per share (in RMB) |
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4 |
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0.01 |
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0.05 |
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4
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE THREE MONTHS ENDED 31
MARCH 2011
(All amounts in RMB millions)
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Three months ended 31 March |
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2010 |
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As restated |
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2011 |
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(Note 2(b)) |
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Profit for the period |
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166 |
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1,209 |
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Other comprehensive income/(loss): |
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Changes in fair value of financial assets
through other comprehensive income/(loss) |
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797 |
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(1,268 |
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Tax effect on changes in fair value of
financial assets through other
comprehensive (income)/ loss |
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(199 |
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315 |
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Changes in fair value of financial assets
through other comprehensive income/(loss),
net of tax |
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598 |
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(953 |
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Currency translation differences |
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(2 |
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(7 |
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Other comprehensive income/(loss) for the
period, net of tax |
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596 |
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(960 |
) |
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Total comprehensive income for the period |
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762 |
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|
249 |
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Total comprehensive income attributable to: |
|
|
|
|
|
|
|
|
Owners of the parent |
|
|
762 |
|
|
|
249 |
|
|
|
|
|
|
|
|
5
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED 31 MARCH 2011
(All amounts in RMB millions)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended 31 March |
|
|
|
Note |
|
|
2011 |
|
|
2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash inflow from operating activities |
|
|
|
|
|
|
11,711 |
|
|
|
18,544 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash outflow from investing activities |
|
|
(a) |
|
|
|
(14,962 |
) |
|
|
(17,153 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash inflow/(outflow) from financing
activities |
|
|
|
|
|
|
5,405 |
|
|
|
(322 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net increase in cash and cash equivalents |
|
|
|
|
|
|
2,154 |
|
|
|
1,069 |
|
Cash and cash equivalents, beginning of period |
|
|
|
|
|
|
22,495 |
|
|
|
7,820 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents, end of period |
|
|
|
|
|
|
24,649 |
|
|
|
8,889 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of the balances of cash and cash
equivalents: |
|
|
|
|
|
|
|
|
|
|
|
|
Cash balances |
|
|
|
|
|
|
7 |
|
|
|
9 |
|
Bank balances |
|
|
|
|
|
|
24,642 |
|
|
|
8,880 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
24,649 |
|
|
|
8,889 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(a) |
|
The net cash outflow from investing activities for the three months ended 31 March 2010
included the proceeds of approximately RMB5,121 million received in relation to disposal of the
CDMA business in 2008. |
6
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL INFORMATION FOR THE THREE MONTHS ENDED 31
MARCH 2011
1. GENERAL INFORMATION
China Unicom (Hong Kong) Limited (the Company) was incorporated as a limited liability company in
the Hong Kong Special Administrative Region (Hong Kong), the Peoples Republic of China (the
PRC) on 8 February 2000. The principal activities of the Company are investment holding and the
Companys subsidiaries are principally engaged in the provision of cellular and fixed-line voice
and related value-added services, broadband and other Internet-related services, information
communications technology services, and business and data communications services in the PRC. The
Company and its subsidiaries are hereinafter referred to as the Group.
2. BASIS OF PREPARATION
The basis of preparation and the significant accounting policies and estimates adopted in the
preparation of the unaudited condensed consolidated financial information for the three months
ended 31 March 2011 are consistent with those used in preparing the annual financial statements for
the year ended 31 December 2010, except that:
(a) Early Adoption of IFRS/HKFRS 9
The Group early adopted IFRS/HKFRS 9 Financial instruments, as well as the related consequential
amendments to other IFRSs/HKFRSs retrospectively from 1 January 2010. Upon the adoption of the
standard, the Company made an irrevocable election to recognise change in fair value of
available-for sale financial assets only through other comprehensive income/loss. There was no
subsequent recycling of fair value gains and losses to the statement of income. The adoption of
IFRS/HKFRS 9 did not have any significant impact on the Group ´s unaudited condensed consolidated
financial information for the three months ended 31 March 2011.
(b) Revenue Recognition on Sale of Goods and Provision of Services
The Group offers promotional packages to the customers which include the bundled sale of mobile
handset and provision of service. Prior to the fourth quarter of 2010, the Group determined the
amount of revenue allocated to the handset using the residual value method. Under such method, the
Group determined the revenue from the sale of the mobile handset by deducting the fair value of the
service element from the total contract consideration. The Group recognised revenue related to the
sale of the handset when the title is passed to the customer whereas service revenue was recognised
based upon the actual usage of mobile services. The cost of the mobile handset was expensed
immediately to the statement of income.
During 2010, the Group has offered preferential promotional packages with more attractive terms to
new subscribers, and more new subscribers were developed under such preferential packages during
the year. In order to provide reliable and more relevant information to users of the financial
statements, starting from the fourth quarter of 2010, the Group determined to adopt the accounting
policy of relative fair value method retrospectively from 1 January 2010 to account for such
preferential promotional packages, considering that each deliverable in the promotional packages
has standalone value to the customer and there is objective and reliable evidence of the fair value
regarding each deliverable in the services packages. Under the relative fair value method, the
total contract consideration of such preferential packages is allocated to service revenue and
sales of handsets based on their relative fair values. The Group recognises revenue relating to the
sale of the handset when the title is passed to the customer whereas service revenue is recognised
based upon the actual usage of mobile services. The cost of the mobile handset is expensed
immediately to the statement of income upon revenue recognition. For details, please refer to Note
2.24(a) set out in the financial statements included in the Companys 2010 Annual Report.
This change in accounting policy resulted in an increase in the Groups revenue, profit before
income tax, profit for the period and earnings per share of RMB107 million, RMB107 million, RMB80
million and RMB0.003, respectively, for the three months ended 31 March 2010; and a decrease in
advance from customers of RMB111 million as at 31 March 2010. The comparative figures have been
restated accordingly.
(c) Going Concern Assumption
As at 31 March 2011, current liabilities of the Group exceeded current assets by approximately
RMB148.7 billion (31 December 2010: approximately RMB156.0 billion). Given the current global
economic conditions and the Groups expected capital expenditures in the foreseeable future,
management has comprehensively considered the Groups available sources of funds as follows:
|
|
The Groups continuous net cash inflow from operating activities; |
|
|
|
Revolving banking facilities of approximately RMB105.8 billion, of which approximately RMB79.0
billion was unutilised as at 31 March 2011; and |
|
|
|
Other available sources of financing from domestic banks and other financial institutions given
the Groups credit history. |
In addition, the Group will continue to optimise its fund raising strategy from the short, medium
and long-term perspectives and maintain reasonable financing costs through appropriate financing
portfolio.
Based on the above considerations, the Board of Directors is of the opinion that the Group has
sufficient funds to meet its working capital requirements and debt obligations. As a result, the
unaudited condensed consolidated financial information of the Group for the three months ended 31
March 2011 has been prepared under the going concern basis.
(d) Renewal of Continuing Connected Transactions in October 2010
The Group renewed the continuing connected transactions on 29 October 2010 which became effective
on 1 January 2011. For details, please refer to Note 39.1(d) set out in the financial statements
included in the Companys 2010 Annual Report.
7
3. AGREEMENT ON ADDITIONAL INVESTMENTS BETWEEN THE COMPANY AND TELEFÓNICA
On 23 January 2011, the Company entered into a strategic alliance agreement with Telefónica that:
(a) Telefónica would purchase ordinary shares of the Company for a consideration of USD500 million
through acquisition from third parties; and (b) the Company would acquire from Telefónica
21,827,499 ordinary shares of Telefónica held in treasury (Telefónica Treasury Shares) for an
aggregate purchase price of Euro374,559,882.84. On 25 January 2011, the Company completed the
purchase of Telefónica Treasury Shares in accordance with the strategic alliance agreement. Please
refer to the section headed AGREEMENT TO ENHANCE THE STRATEGIC ALLIANCE WITH TELEFÓNICA for
details.
4. EARNINGS PER SHARE
Basic earnings per share for the three months ended 31 March 2011 and 2010 were computed by
dividing the profit attributable to owners of the parent by the weighted average number of ordinary
shares outstanding during the periods.
Diluted earnings per share for the three months ended 31 March 2011 and 2010 were computed by
dividing the profit attributable to owners of the parent by the weighted average number of ordinary
shares outstanding during the periods, after adjusting for the effects of dilutive potential
ordinary shares. All potential ordinary shares for the three months ended 31 March 2011 arose from
(i) share options granted under the amended Share Option Scheme; (ii) share options granted under
the amended Special Purpose Share Option Scheme and (iii) convertible bonds, while all potential
ordinary shares for the three months ended 31 March 2010 arose from (i) share options granted under
the amended Pre-Global Offering Share Option Scheme, (ii) share options granted under the amended
Share Option Scheme; and (iii) share options granted under the amended Special Purpose Share Option
Scheme.
The potential ordinary shares which are not dilutive for the three months ended 31 March 2011 arose
from (i) share options with exercise price of HKD15.42 granted under the amended Share Option
Scheme and (ii) convertible bonds with initial conversion price of HKD15.85, while the potential
ordinary shares which are not dilutive for the three months ended 31 March 2010 arose from (i)
share options with exercise price of HKD15.42 granted under the amended Pre-Global Offering Share
Option Scheme and (ii) share options with exercise price of HKD15.42 granted under the amended
Share Option Scheme, which were excluded from the weighted average number of ordinary shares for
the purpose of computation of diluted earnings per share.
The following table sets forth the computation of basic and diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
Three months ended 31 March |
|
|
|
|
|
|
|
2010 |
|
|
|
2011 |
|
|
As restated |
|
|
|
|
|
|
|
|
|
|
Numerator (in RMB millions): |
|
|
|
|
|
|
|
|
Profit attributable to owners of the parent |
|
|
166 |
|
|
|
1,209 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Denominator (in millions): |
|
|
|
|
|
|
|
|
Weighted average number of ordinary shares outstanding used in computing basic earnings per share |
|
|
23,562 |
|
|
|
23,562 |
|
|
|
|
|
|
|
|
|
|
Dilutive equivalent shares arising from share options |
|
|
190 |
|
|
|
112 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shares used in computing diluted earnings per share |
|
|
23,752 |
|
|
|
23,674 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share (in RMB) |
|
|
0.01 |
|
|
|
0.05 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share (in RMB) |
|
|
0.01 |
|
|
|
0.05 |
|
|
|
|
|
|
|
|
8
FINANCIAL OUTLINE
For the first quarter of 2011, with more robust growth in revenue from mobile business and
continuous rapid growth in revenue from broadband and internet businesses, as well as the
continuous optimisation of subscribers structure, consumption structure and revenue structure, the
overall business development of the Company demonstrated a trend of rapid growth.
Revenue
For the first quarter of 2011, total revenue reached RMB49.03 billion, of which, telecommunications
service revenue was RMB43.22 billion. Excluding the effect of deferred fixed-line upfront
connection fees (the adjustment to exclude the above item is referred herein below as the
Adjustment or Adjusted) (Note 1), total revenue and telecommunications service revenue would
increase by 21.2% and 11.9%, respectively, as compared to the same period of last year.
Revenue from the mobile business (Note 2) was RMB28.42 billion, up by 42.0% from the same period of
last year. Telecommunications service revenue from the mobile business was RMB23.29 billion, up by
25.0% from the same period of last year. Monthly average minutes of usage (MOU) per subscriber
was 283.0 minutes, and monthly average revenue per user (ARPU) was RMB45.5. Of which,
telecommunications service revenue from 3G business was RMB5.68 billion and as a percentage of
telecommunications service revenue from the mobile business, there was an increase from 8.5% for
the first quarter of 2010 to 24.4% for the first quarter of 2011. MOU per subscriber was 630.8
minutes and ARPU was RMB117.2.
Revenue from the fixed-line business (Note 2) was RMB20.36 billion, up by 0.7% from the same period
of last year. Telecommunications services revenue from the fixed-line business after the Adjustment
would be RMB19.92 billion, up by 0.1% from the same period of last year. Telecommunications service
revenue from broadband business was RMB8.44 billion, up by 18.4% from the same period of last year.
ARPU of broadband business was RMB58.0.
Costs and Expenses and Others
For the first quarter of 2011, total costs and expenses and others, including finance costs,
interest income and other income-net, were RMB48.79 billion, up by 25.3% from the same period of
last year. Depreciation and amortisation were RMB14.06 billion, increase by RMB0.89 billion or 6.8%
as compared to the same period of last year. Networks, operations and support expenses were RMB6.84
billion, increase by RMB0.61 billion or 9.8% as compared to the same period of last year. Selling
expenses were RMB6.79 billion, increase by RMB1.10 billion or 19.3% as compared to the same period
of last year. Cost of telecommunications products sold was RMB7.18 billion, up by 392.1% from the
same period of last year. Loss on the sale of telecommunications products was RMB2.04 billion, of
which, loss on the sale of 3G handsets (3G handset subsidy cost) was RMB1.90 billion, increase by
RMB1.80 billion as compared to the same period of last year.
9
Earnings
For the first quarter of 2011, profit before income tax was RMB0.23 billion and profit for the
period was RMB0.17 billion. Basic earnings per share was RMB0.007. Adjusted profit for the period
would be RMB0.15 billion, down by 86.5% as compared to the same period of last year. Adjusted
EBITDA (Note 3) would be RMB14.69 billion, down by 2.6% as compared to the same period of last
year. EBITDA margin (adjusted EBITDA as a percentage of the total revenue after the Adjustment)
would be 30.0%.
Additional Information
Although revenue from the 3G business and fixed-line broadband business of the Company have been
growing fast, the Companys earnings for first half of 2011 may be substantially different from the
earnings for the first half of 2010 due to the fast-increasing of depreciation and amortisation,
networks, operations and support expenses, as well as selling expenses, particularly the 3G handset
subsidies.
This announcement is also made pursuant to Rule 13.09 of the Listing Rules.
Note 1: |
|
In order to ensure the comparability of revenue amounts and profit for the period, the
non-comparable factor below which is reflected in the figures of current period and last
period are excluded for purpose of additional analysis: |
|
(1) |
|
deferred fixed-line upfront connection fees of RMB13 million for the
first quarter of 2011 and RMB75 million for the first quarter of 2010. |
Note 2: |
|
Revenue from external customers excluding intersegment revenue. |
|
Note 3: |
|
EBITDA represents profit for the period before interest income,
finance costs, other income-net, income tax, depreciation and
amortisation. As the telecommunications business is a capital
intensive industry, capital expenditures and finance costs may
have a significant impact on the net profit of the companies with
similar operating results. Therefore, we believe that EBITDA may
be helpful in analyzing the operating results of a
telecommunications service operator like our Group. |
|
|
|
Adjusted EBITDA represents EBITDA excluding non-comparable factor
of deferred fixed-line upfront connection fees. From the
perspective of cash flow and continuing operation, the above
non-comparable factor is not considered as the Companys operating
performance, the Company therefore believes that Adjusted EBITDA
excluding the above non-comparable factor not only could provide
more meaningful supplement information to management and
investors, but also facilitate them to evaluate the Companys
performance and liquidity. |
|
|
|
Although EBITDA and Adjusted EBITDA have been widely applied in
the global telecommunications industry as indicators to reflect
operating performance, financial capability and liquidity, they
should be considered in addition to, and are not substitute for or
superior to, the measure of financial performance prepared under
generally accepted accounting principles (GAAP) as they do not
have any standardised meaning under GAAP. In addition, they may
not be comparable to similar indicators provided by other
companies. |
10
AGREEMENT TO ENHANCE THE STRATEGIC ALLIANCE WITH TELEFÓNICA
On 23 January 2011, the Company and Telefónica S.A. (Telefónica) entered into an Agreement to
Enhance the Strategic Alliance (the Agreement to Enhance the Strategic Alliance).
Pursuant to the Agreement to Enhance the Strategic Alliance, the Company acquired from Telefónica
21,827,499 ordinary shares of Euro1.00 each in the capital of Telefónica for an aggregate purchase
price of Euro374,559,882.84 on 25 January 2011, and Telefónica agreed to purchase ordinary shares
of HKD0.10 each in the capital of the Company for the aggregate consideration of USD500,000,000
through acquisitions from third parties within nine months after the date of the signing of the
Agreement to Enhance the Strategic Alliance.
Under the Agreement to Enhance the Strategic Alliance, the Company and Telefónica agreed to enhance
their existing strategic alliance and to deepen their cooperation in procurement, mobile service
platforms, service to multinational customers, wholesale carriers, roaming, technology/ research
and development, international business development, cooperation and the sharing of best practices.
Furthermore, Telefónica has agreed to propose at its next general shareholders meeting the
appointment of an individual designated by the Company as a director to the board of directors of
Telefónica.
Please refer to the Companys announcement dated 23 January 2011 for details.
CAUTION STATEMENT
The Board wishes to remind investors that the unaudited financial information and the financial
outline for the three months ended 31 March 2011 are based on the Groups internal records and
management accounts and have not been reviewed or audited by the auditors. The financial
information for the three months ended 31 March 2010 are extracted from the unaudited financial
information of the Group and has been restated; and the financial information for the year ended 31
December 2010 are extracted from the audited financial statements as contained in the 2010 Annual
Report and has been restated.
Investors are cautioned not to unduly rely on financial data, statistics and comparison for the
three months ended 31 March 2011. In the meantime, investors are advised to exercise caution in
dealing in the shares of the Company.
As at the date of this announcement, the board of directors of the Company comprises:
|
|
|
Executive directors:
|
|
Chang Xiaobing, Lu Yimin, Tong Jilu and Li Fushen |
|
|
|
Non-executive director:
|
|
Cesareo Alierta Izuel |
|
|
|
Independent non-executive directors:
|
|
Cheung Wing Lam Linus, Wong Wai Ming, John Lawson Thornton, Timpson Chung Shui Ming and Cai Hongbin |
|
|
|
|
|
By Order of the Board of
China Unicom (Hong Kong) Limited
Chu Ka Yee
Company Secretary |
Hong Kong, 26 April 2011
11