China Telecom reported steady rises in profit and mobile revenue in the first half of 2019 as continued subscriber gains and double-digit data growth offset declining ARPU.

The company’s net profit increased 2.5 per cent year-on-year to CNY13.9 billion ($1.97 billion), while service revenue rose 2.8 per cent to CNY183 billion on the back of 5.6 per cent growth in mobile service revenue to CNY88.2 billion.

In a statement, Ke Ruiwen, the company’s chairman and CEO, noted that ICT advances such as cloud computing, 5G and AI are maturing and providing new growth impetus for the industry.

Mobile data turnover increased 10.4 per cent year-on-year to CNY73.9 billion, while voice revenue fell 14.5 per cent to CNY14.1 billion. Handset sales sank 54.7 per cent to CNY5.48 billion. Wireline service revenue was flat at CNY94.4 billion.

Continued gains
Its mobile subscriber base increased 14.9 per cent from end-June 2018 to 323 million, with a net addition of 49 million LTE users, giving it a 4G penetration of 82 per cent.

Mobile ARPU dropped 10.5 per cent year-on-year to CNY46.90, with 4G ARPU slipping 12.2 per cent to CNY51.20. Average data usage per month jumped from 4.5GB in June 2018 to 7.3GB at the end of the most recent period.

Ke said after licences were awarded in June, the company accelerated the pace of 5G commercialisation, with the company deploying a hybrid standalone-non-standalone network in about 50 cities in the initial stage. It is targeting connecting 40,000 5G base stations by the end of 2019.

Capex in the period rose 6.3 per cent from a year earlier to CNY35 billion. It has 1.52 million 4G base stations supporting three spectrum bands. The capex budget for the full year is set at CNY78 billion, 4 per cent higher than in 2018.