China Unicom, the second largest mobile operator in the country, reported a surge in profit in 2017 as service revenue and subscriber additions recovered from a weak 2016.
The operator’s net profit jumped 192.5 per cent year-on-year to CNY1.83 billion ($289 million), which matched a profit alert it issued on 1 March. The company said excluding a CNY2.9 billion net loss on asset disposal related to a fibre network upgrade, its net profit would have increased 540.5 per cent year-on-year to CNY4 billion.
Service revenue for 2017 rose 4.6 per cent year-on-year to CNY249 billion. Mobile service turnover rose 7.9 per cent to CNY156 billion, which the operator said exceeded the industry average by 2.2 percentage points.
Wang Xiaochu, China Unicom’s chairman and CEO, said in a statement: “The company successfully turned around its operating results with significant improvement. A substantive breakthrough was made on mixed-ownership reform and the company saw fundamental improvement in operating results, marching a solid step forward towards its transformational development.”
He said the company benefitted from the completion of a capital injection deliverd by the implementation of the mixed-ownership reform, which strengthened its balance sheet substantially.
A 41.6 per cent year-on-year reduction in capex to CNY42.13 billion also helped its bottom-line. Despite the decrease, the operator managed to add 110,000 4G base stations last year to take its total to 850,000.
Its overall mobile subscriber base rose 2.7 per cent to 284 million at end 2017: 4G subcribers increased 67 per cent to 175 million. Mobile ARPU increased 3.5 per cent year-on-year to CNY48.