News
Conglomerate reports strong EBITDA growth in Europe, but challenges remain in Hong Kong, Australia.
CK Hutchison’s telcos on Thursday reported solid first half performances in Europe, tempered by weaker results in Hong Kong and Australia.
3 Group Europe generated revenue of HK$30.17 billion (€3.47 billion) in the six months to 30 June, down 1% from last year on a reported basis due to the depreciation of the euro, but up by 1% in local currencies. Reported EBITDA jumped 9% to HK$8.49 billion, while pretax profit increased by 10% on a reported basis to HK$5.41 billion.
Hutch attributed the earnings growth to improved net customer service margin – which increased by a single percentage point to 84% – synergies at 3 Ireland, as well as cost management across its European footprint.
"With approximately 26.8 million active customers as at 30 June 2016, 3 Group Europe is now one of the major earnings contributors to the group," said CK Hutchison chairman Li Ka-shing, in a statement.
The picture was less rosy in Hong Kong though, where, as reported earlier this month, first half revenues slumped to HK$5.37 billion from HK$11.06 billion a year ago, due to lower hardware sales caused by a lack of popular handsets, and a reduction in roaming revenue.
At Vodafone Hutchison Australia (VHA), of which CK Hutchison holds 50%, revenue slipped 10% year-on-year to A$802 million (€554.29 million), driven by January’s reduction in mobile termination rates.
However, "EBITDA of A$206 million represented an 8% increase over last year driven by growth in the customer base and good cost controls," CK Hutchison said. Coupled with lower depreciation and amortisation costs, VHA’s loss attributable to shareholders narrowed to A$66 million from $90 million in the first half of 2015.
Meanwhile, in Indonesia, revenue surged 26% to HK$4.01 billion, while EBITDA rocketed to HK$1.25 billion from HK$411 million a year ago, "reflecting the continuing expansion in the customer base," said CK Hutchison.
