China Mobile profit beats estimates on 4G subscriber gains

[SHANGHAI] China Mobile Ltd's first-half profit rose 5.6 per cent, beating analyst estimates, after the world's largest phone carrier by users added more 4G subscribers than the populations of the UK and Spain combined.

Net income increased to 60.6 billion yuan (S$12.23 billion), compared with 57.3 billion yuan a year earlier, the company said in a statement on Thursday. The results exceeded the 58.8 billion yuan median of five analysts' estimates in a Bloomberg News survey.

The carrier, which accounts for about 65 per cent of the nation's wireless users, added 116.3 million 4G subscribers during the first six months as more people made the switch from slower services.

That market has room to grow as more than half of China's mobile-phone users use slower 3G or 2G services.

China Mobile shares were unchanged at HK$96.05 at the midday trading break in Hong Kong.

Separately among other phone operators in the region, Australia's Telstra Corp on Thursday reported a 36 per cent increase in its fiscal-year profit, more than analysts estimated.

Singapore Telecommunications Ltd posted quarterly earnings that were little changed from a year earlier.

Operating revenue for China Mobile increased 7.1 per cent to 370.4 billion yuan.

Earnings before interest, taxes, depreciation and amortisation gained 2.9 per cent to 134.4 billion yuan. The company added 10.8 million broadband users during the first six months.

The company says it will continue to hold talks with regulators on the expected cancellation of long-distance and roaming tariffs. Though the company says it had a "good" first half, competition in 4G, new competition from Internet companies and regulatory uncertainties are risks that China Mobile faces going forward.

BLOOMBERG