Annual Financial Review

Telecommunications Services (Continued) The enterprise segment delivered robust growth momentum during the year as enterprise customers accelerated their digital transformation, recognizing the urgency and necessity of adopting digital solutions which has been amplified by the pandemic. This drove demand for our wide range of fixed-mobile converged solutions that now incorporate not only 5G but also artificial intelligence, Internet of Things and other new, emerging technologies. As a result, local data revenue recorded substantial growth of 8% for the year ended December 31, 2021. Local Telephony Services. Local Telephony Services revenue was HK$2,826 million for the year ended December 31, 2021 versus HK$3,084 million a year earlier. This result reflected the continued migration of residential fixed-line customers to our broadband and mobile services, coupled with increased fixed-line terminations due to household relocations, as well as continued softness in the small and medium-sized enterprise segment during the year. As such, the total number of fixed lines in service at the end of December 2021 was 2.443 million, compared to 2.522 million a year earlier. Other Services. Other Services revenue comes mainly from the sale of network equipment and customer premises equipment and the provision of technical and maintenance subcontracting services and contact center services ("Teleservices"). Other services revenue for the year ended December 31, 2021 remained steady at HK$3,420 million. International Telecommunications Services. International Telecommunications Services revenue was HK$7,006 million for the year ended December 31, 2021 versus HK$7,644 million a year earlier. The pullback primarily stemmed from the global wholesale voice business which was affected by the curtailment of international travel and a shift in voice traffic to digital platforms as well as the absence of lumpy one-off cable revenues that occurred in 2020. However, wholesale voice is a relatively thin margin business. As cloud computing adoption continues to spread globally, demand for cloud interconnectivity services offered through our Console Connect platform grew. To support this growth, Console Connect has extended its reach and, as of the end of December 2021, allowed users to instantly reach almost 600 data centers and 150 cloud zones globally on an on-demand basis. The TSS business registered an increase in EBITDA of 1% to HK$8,468 million with the EBITDA margin increasing to 39%, primarily due to the shift in revenue mix towards Local Data Services and further operating efficiencies amid an ongoing focus on cost initiatives during the year. 8

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