Annual Financial Review slide image

Annual Financial Review

Mobile For the year ended December 31, HK$ million Mobile Revenue Mobile Services Mobile Product Sales Total Mobile Revenue Mobile EBITDA¹ Mobile Services Mobile Product Sales Total Mobile EBITDA¹ 2020 2021 Better/ (Worse) Full Full H1 H2 Year H1 H2 Year y-o-y 3,573 4,184 7,757 970 1,639 2,609 3,577 4,241 7,818 1,531 2,399 3,930 1% 51% 4,543 5,823 10,366 5,108 6,640 11,748 13% 2,057 (7) 2,639 58 4,696 51 2,058 14 2,643 65 4,701 79 55% 2,050 2,697 4,747 2,072 2,708 4,780 1% Mobile EBITDA' margin Mobile Services EBITDA' margin 45% 46% 46% 41% 41% 41% 58% 63% 61% 58% 62% 60% The Mobile business recorded a healthy 13% growth in revenue to HK$11,748 million for the year ended December 31, 2021. Mobile services revenue rose by 1% to HK$7,818 million, as the 2% growth in local core revenue more than offset the overhang of moderated roaming and IDD revenue resulting from extended travel restrictions. The expansion in local core revenue benefited from the ARPU uplift from new subscriptions and upgrades to our 5G plans alongside growth in our overall customer base. Mobile product sales increased by 51% to HK$3,930 million reflecting consumer upgrades to new 5G handset models amid improved sentiment and increased spending stimulated by the Government's Consumption Voucher Scheme. Revenue growth was also aided by our digital platform, Club Shopping, which provides customers with a convenient service through our "redeem and shop" offerings that also helps to build customer loyalty. Despite intense market competition, the Mobile business continued to report a net gain in post-paid customers to 3.297 million in 2021, representing net additions of 45,000 or 1% growth during the year. By leveraging The Club to deepen customer engagement and loyalty, the churn rate for post-paid customers reached an all-time low of 0.7% in 2021. In November 2021, the Mobile business launched a unique and innovative digital campaign “csl. 5G x MIRROR" which incorporated AR technology. Receiving an overwhelming response, the campaign has helped to further drive subscriptions to our 5G plans. As at the end of December 2021, our 5G customer base was 680,000. By January 2022, this had increased further to 756,000 customers representing 23% of our post-paid base as subscribers were pulled in by our first to market 5G celebrity premium plans. The post-paid exit ARPU as at December 31, 2021 rebounded by 2% to HK$187 versus HK$184 as at December 31, 2020, primarily driven by the 5G service plan uplift. Mobile services EBITDA for the year was steady at HK$4,701 million with a margin of 60% reflecting continuing discipline in operating expenditure and optimization of offline-to-online sales channels. Total Mobile EBITDA for the year increased by 1% to HK$4,780 million from HK$4,747 million a year earlier supported by the healthy growth in Mobile product sales. 9
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