China Mobile 2015 profit falls 0.6%, in line with estimates

[HONG KONG] China's largest mobile phone carrier China Mobile said on Thursday its net profit slipped 0.6 per cent last year, broadly in line with estimates, as smaller rivals gained ground in the deployment of lucrative fourth-generation (4G) services.

In a filing, China Mobile said 2015 net profit fell to 108.5 billion yuan (S$22.8 billion) from 109.2 billion yuan a year earlier. Revenue climbed 2.6 per cent to 668 billion yuan from a revised 651.5 billion yuan.

The results compared with the average estimates of analysts polled by Thomson Reuters SmartEstimates of 110 billion yuan in net profit and 662.6 billion yuan in revenue.

"4G expansion is the focal point for 2016," chairman Shang Bing said in the filing. He said revenue from data services exceeded those from once-lucrative voice calls and text for the first time.

Like smaller peers China Unicom Hong Kong Ltd and China Telecom, the company competes in communications with popular free messaging apps like Tencent Holdings Ltd's WeChat, which continued to eat into revenue at network providers.

China Mobile shares fell 1.8 per cent on early Thursday afternoon after the results, compared with a 1.1 per cent gain in the broader Hang Seng index.

China Mobile's total number of mobile subscribers reached 826 million last year - easily more than twice the population of the United States - up 2.4 per cent from 2014.

Of that, over 300 million were on 4G contracts, up from over 90 million a year ago, a bright spot for the company as these customers generally spend far more on faster-service plans than other users.

REUTERS