HKT Trust and HKT (6823) H2 2024 earnings summary

Executive summary

• Achieved resilient financial performance in 2024, with total revenue up 1% to HK$34,753 million (US$4,456 million) and EBITDA up 3% to HK$13,743 million (US$1,762 million), driven by efficiency improvements, AI deployment, and strong enterprise, broadband, and mobile growth.

• Strengthened balance sheet through significant deleveraging, reducing net-debt-to-EBITDA to 2.9x and maintaining investment grade ratings.

• Enterprise segment revenue rose 8%, with China business up 37% to HK$1 billion and healthcare sector revenue up 43%.

• 5G customer base grew 25% to 1.747 million, now 51% of post-paid base; broadband FTTH connections reached 1.04 million.

• Board recommended a final distribution per share of 45.88 HK cents, totaling 78.80 HK cents for the year, representing a 3% increase and full payout of adjusted funds flow.

Financial highlights

• Total revenue (excluding mobile product sales) rose 2% to HK$32,031 million; total revenue including handset sales up 1% to HK$34,753 million; handset sales dropped 8% to HK$349 million.

• EBITDA increased 3% to HK$13,743 million, with margin improving to 40%.

• Adjusted funds flow grew 3% to HK$5,973 million (US$766 million); net profit attributable to holders up 2% to HK$5,070 million (US$650 million).

• OpEx reduced by 5% year-on-year, with OpEx/revenue ratio improving to below 9.5%.

• CapEx for 2024 was HK$2,214 million, 6.4% of revenue; CapEx/revenue ratio improved.

Outlook and guidance

• Further ARPU improvement expected in both fixed and mobile segments, supported by roaming recovery and broadband upgrades.

• AI initiatives and digital transformation to drive revenue and EBITDA growth, especially in enterprise solutions and productivity.

• Prudent capital expenditure and continued deleveraging planned amid economic uncertainty and elevated interest rates.