Annual Financial Review

Telecommunications Services For the year ended December 31, HK$ million 2020 2021 Better/ (Worse) Full Full H1 H2 Year H1 H2 Year y-o-y TSS Revenue Local TSS Services - Local Data Services - Local Telephony Services - Other Services International Telecommunications Services Total TSS Revenue Cost of sales Operating costs before depreciation and amortization Total TSS EBITDA¹ TSS EBITDA margin 8,560 2,826 (8)% 6,622 8,091 14,713 6,926 3,696 4,521 8,217 3,877 4,683 1,532 1,552 3,084 1,449 1,377 1,394 2,018 3,412 1,600 1,820 7,880 14,806 1% 4% 3,420 3,764 3,880 7,644 3,317 3,689 7,006 (8)% 10,386 11,971 22,357 10,243 11,569 21,812 (5,346) (6,539) (11,885) (5,305) (6,149) (11,454) (2)% 4% (1,239) (821) (2,060) (1,114) (776) (1,890) 8% 3,801 4,611 8,412 3,824 4,644 8,468 1% 37% 39% 38% 37% 40% 39% Local TSS revenue grew by 1% to HK$14,806 million for the year ended December 31, 2021 underpinned by an increase of 4% in Local Data Services revenue to HK$8,560 million, a revenue base now representing 58% of the Local TSS Services segment. Local Telephony Services generated HK$2,826 million in revenue reflecting the continued industry shift away from traditional voice towards broadband and mobile services. Revenue from International Telecommunications Services came in at HK$7,006 million during the year. As a result, total TSS revenue edged down 2% to HK$21,812 million. Local Data Services. Comprising broadband network revenue and local data revenue, Local Data Services revenue rose by 4% to HK$8,560 million for the year ended December 31, 2021. The Broadband Network business recorded revenue growth for the 14th successive year, with revenue increasing by 2%. The business continued to benefit from the superior quality and reliability of HKT's fiber network and the success of our three-pronged strategy. This strategy encompasses the targeted marketing of our leading FTTH service through the brands of "HKT Premier”, “NETVIGATOR” and “LiKE100" with our diverse range of value added services. With home entertainment, online learning and remote work arrangements being the norm, demand for fast and reliable broadband connectivity and Home Wi-Fi solutions remained strong during the year. Despite fierce price competition and elevated line terminations due to households relocating overseas, the business achieved an overall net gain in broadband customers during the year, with total broadband access lines growing by 1% to 1.637 million as at the end of December 2021. Of these, 944,000 were FTTH connections which represented a net increase of 52,000 or 6% growth from a year earlier. Penetration of our Home Wi-Fi solutions also continued to rise steadily, which helped lift overall ARPU. During the year, a total of 333,000 customers subscribed to our Home Wi-Fi solutions, up 8% compared to the previous year and representing 23% of the consumer broadband base. 7

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