- China Tower Corp Ltd (CHWRF) Full Year 2025 Earnings Call Highlights: Robust Profit Growth Amid ...
Mar 18, 2026
This article first appeared on GuruFocus.
Operating Revenue: RMB100 billion, a year-on-year increase of 2.7%. Net Profit: RMB11.6 billion, up 8.4% year-on-year. EBITDA: RMB65.8 billion, down 1.1% year-on-year. Net Cash Flow from Operating Activities: RMB56.1 billion, up RMB6.65 billion year-on-year. Free Cash Flow: RMB26.6 billion, an increase of RMB9.1 billion year-on-year. TSP Business Revenue: RMB84.7 billion, accounting for 84.4% of total revenue. Two-Wing Business Revenue: RMB15 billion, up 11.9% year-on-year, accounting for 14.9% of total revenue. Smart Power Business Revenue: RMB10.1 billion, a year-on-year increase of 14.2%. Energy Business Revenue: RMB4.8 billion, a 7.5% increase year-on-year. Dividend Payout Ratio: Increased to 77% for the full year.
Warning! GuruFocus has detected 6 Warning Signs with CHWRF. Is CHWRF fairly valued? Test your thesis with our free DCF calculator.
Release Date: March 18, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
China Tower Corp Ltd (CHWRF) reported a robust operating performance with a net profit increase of 8.4% year-on-year. The company has successfully implemented a multi-pillar development structure, with revenue from the two-wing business increasing to 14.9%. Significant advancements in technological innovation were made, with R&D expenses increasing by 82%. The company maintained a strong emphasis on shareholder returns, with the full-year dividend payout ratio rising to 77%. The smart power business experienced rapid growth, with revenue reaching RMB10.1 billion, a year-on-year increase of 14.2%.
Negative Points
EBITDA decreased by 1.1% year-on-year due to an increase in tenant withdrawal resulting from the network consolidation between China Unicom and China Telecom. The growth rate of the number of tenants has slowed down, with the total power tenancy ratio slightly lower than the previous year. CapEx expenditure decreased significantly compared to 2024, raising concerns about future infrastructure investments. The introduction of the one single network and termination of some tenancy agreements may lead to a downward trend in EBITDA in 2026. Investment in maintaining and reinforcing existing tower sites is expected to increase by 30% to 40%, impacting short-term profitability.
Q & A Highlights
Q: Can you provide guidance for 2026, including revenue, net profit, EBITDA, and CapEx expenditure? A: (Zhiyong Zhang, Executive Chairman) In 2026, we expect steady growth in our one-core business, driven by the expansion of 5G infrastructure and digitalization trends. Our CapEx will focus on new tower sites, co-location, and IT infrastructure, remaining similar to 2025 levels. Profitability will improve as depreciation on older assets concludes, despite increased investment in tower site maintenance.
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Q: What is the company's dividend policy, and is there potential for increased payouts? A: (Zhiyong Zhang, Executive Chairman) Currently, 10% of distributable earnings are reserved for dividends, but by 2028, this will be based entirely on attributable profit. This change will allow for potentially higher dividend payouts in the future.
Q: How is China Tower preparing for the commercialization of 6G, expected by 2030? A: (Zhiyong Zhang, Executive Chairman) We are actively involved in 6G development, leveraging our extensive tower infrastructure and technological capabilities. Our competitive advantages include non-replicable resources, co-location models, and integration of advanced technologies, positioning us well for 6G deployment.
Q: What are the growth prospects for the smart tower and energy businesses? A: (Zhiyong Zhang, Executive Chairman) The smart tower business will benefit from digitalization trends, expanding services across industries. The energy business, driven by green mobility and electric vehicle trends, is expected to see high growth, focusing on charging, power storage, and battery exchange.
Q: How will the introduction of a single network affect EBITDA and operational costs? A: (Zhiyong Zhang, Executive Chairman) The single network introduction will initially lower EBITDA due to tenant withdrawals and increased maintenance costs. However, after two to three years, as reinforcement expenses stabilize, we anticipate an upward trend in EBITDA.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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- China Tower (788.HK) Announces 2025 Annual Results
Mar 18, 2026
Deepens "One Core and Two Wings" Strategy Continues to Strengthen Core Competitiveness to Enhance Shareholder Returns
HONG KONG, HK / ACCESS Newswire / March 18, 2026 / The world's largest telecommunications infrastructure service provider China Tower Corporation Limited ("China Tower", or the "Company") (Stock Code:0788.HK) is pleased to announce its annual results for the year ended 31 December 2025.
Performance Highlights
RMB Million 2025 2024 Change Operating revenue 100,411 97,772 2.7% EBITDA[1] 65,814 665.59 -1.1% Profit attributable to owners of the Company 11,630 107.29 8.4% Basic earnings per share (RMB yuan) (Re-presented) 0.6653 0.6138 8.4% Dividend per share (RMB yuan) 0.45789 0.41696 9.8% Key operating data Number of tower sites (thousand) 2,149 2,094 2.6% Number of tower tenants (thousand) 3,856 3,791 1.7% Tenancy ratio (tenants / tower site) 1.79 1.81 -1.1%
In 2025, the Company's operating revenue maintained stable growth and profitability remained strong. Operating revenue for the year reached RMB100,411 million, an increase of 2.7% year-on-year. EBITDA reached RMB65,814 million, a decrease of 1.1% year-on-year, with an EBITDA margin[2] of 65.5%. Profit attributable to the owners of the Company reached RMB11,630 million, an increase of 8.4% year-on-year, with a net profit margin of 11.6%.
The Company maintained a strong and stable cash flow. Net cash generated from operating activities for the year amounted to RMB56,116 million, an increase of RMB6,648 million year-on-year. Capital expenditures stood at RMB29,486 million while free cash flow[3] reached RMB26,630 million, up by RMB9,103 million year-on-year.
As at 31 December 2025, our total assets amounted to RMB336,579 million, with interest-bearing liabilities of RMB90,460 million and a gearing ratio[4] of 27.7%, representing a decrease of 3.3 percentage points from the end of 2024. Our financial position remains healthy and stable.
The Company has always attached great importance to shareholder returns. After considering our profitability, cash flow and future development needs, the board of directors of the Company has recommended a final dividend of RMB0.32539 per share (pre-tax) for the year ended 31 December 2025. Together with the interim dividend distributed, the total full-year dividend amounted to RMB0.45789 per share (pre-tax), equivalent to a payout ratio of 77% of our annual distributable net profit.
Refined operations enabled steady progress in TSP business
The Company continued to play a leading role in new 5G infrastructure construction, further deployed the Dual-Gigabit network joint-entry implementation, and made solid progress in supporting special projects such as upgrading signal strength, extending broadband coverage to all border areas, forests and grasslands. Capturing the strategic opportunities arising from the wide-area 5G network coverage expansion and enhancement of in-depth coverage, we focused on enhancing intensive sharing of network resources and fully satisfying customers' demands for network construction. As a result, our TSP business maintained stable growth in 2025, recording revenue of RMB84,725 million, an increase of 0.7% year-on-year.
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Tower business. The Company seized opportunities arising from customers' ongoing network expansion requirements and leveraged our competitiveness as a service provider by offering efficient delivery, superior maintenance and optimal cost structure, while minimizing management risks. We deepened the embedded service mechanism, precisely captured customers' network planning needs, and comprehensively secured construction demands in key scenarios and key regions. Leveraging our site resources and base station data, we proactively conducted coverage analysis to enhance network optimization capabilities. We also enhanced our collaborations with TSPs to provide customers with better services. By adhering to a customer-oriented philosophy, we continued to optimize end-to-end business processes and management standards to enhance service capabilities across the board. In 2025, revenue from our Tower business amounted to RMB75,498 million, a decrease of 0.3% year-on-year. As at the end of 2025, the Company managed a total of 2.149 million tower sites, an increase of 55,000 from the end of 2024. We have gained 23,000 new TSP tenants since the end of 2024, bringing the total number of TSP tenants to 3.567 million at the end of 2025. Our TSP tenancy ratio was 1.70.
DAS business. We continued to focus on high-value and livelihood-critical scenarios, systematically enhancing resource coordination and sharing, and collaborative construction capabilities, as well as accelerating 5G network upgrades on high-speed railways. At the same time, we deployed shared repeaters at scale in everyday scenarios such as elevators, underground parking lots, tunnels, and residential communities, helping TSPs achieve efficient and low-cost network coverage extension. We continued to optimize the integrated active and passive DAS sharing solutions and promoted the implementation of innovative solutions such as shared frequency shifting in existing DAS 5G upgrades. By doing so, we enhanced product and service competitiveness to efficiently meet customer needs. In 2025, our DAS business achieved relatively high growth, with revenue reaching RMB9,227 million, an increase of 9.5% year-on-year. By the end of 2025, we had covered buildings with a cumulative area of 15.15 billion square meters, up by 19.5% year-on-year, while the coverage in railway tunnels and subways reached a cumulative length of 33,661 kilometers, an increase of 14.8% year-on-year.
Vertical advancement supported strong growth in Two Wings business
In the Two Wings business, we seized market opportunities while continuing to strengthen product competitiveness and drive rapid growth of the business. In 2025, revenue of the Two Wings business reached RMB14,985 million and accounted for 14.9% of our overall operating revenue, an increase of 1.2 percentage points over the same period last year.
Smart Tower business. Focusing on spatial digital intelligence governance and leveraging our rich resources and capabilities, we continued to enhance our Smart Tower business, achieving revenue in excess of RMB10 billion. We continued to deepen our presence in key industries and scenarios, steadily increasing market share in key areas such as straw burning prohibition, farm land protection, and disaster alert. We advanced our nationwide distributed platform, optimizing algorithm service capabilities for mid-to-high point scenarios, with further improvements in platform response speed, algorithm accuracy, and application availability. We maintained our focus on implementing the "AI+" special project, promoting the application of large models for spatial digital intelligence governance, which were included in the first batch of strategic high-value AI scenarios for central state-owned enterprises. Customers are always at the center of everything wedo. Therefore, we strengthened the development of product iterations, construction delivery, and operation and maintenance support, as well as expanding our integrated technical support teams, with an aim to respond actively and promptly to customers' needs. In 2025, our Smart Tower business generated revenue of RMB10,172 million, up by 14.2% year-on-year, among which, revenue from our Tower Monitoring business reached RMB6,327 million, accounting for 62.2% of the Smart Tower business revenue.
Energy business. We focused on key business segments such as battery exchange and powerbackup. By improving refined operations and strengthening core capabilities and competitive advantages in products, services, and platforms, we continued to develop our specialty in the Energy business. For the battery exchange business, we continued to expand our share in the food delivery mass market while accelerating the expansion of our corporate customer base, resulting in stable user growth. As at 31 December 2025, we had approximately 1.477 million battery exchange users, an increase of 173,000 since the end of 2024, further solidifying our leading position in the low-speed electric vehicle battery exchange market. We accelerated the construction of a community-based low-speed electric vehicle charging facility network while optimizing operational efficiency, resulting in expanded service coverage and user scale. For the power backup business, we continued to focus on pivotal industries and our premium customer base, creating the ChinaTower "energy butler" integrated industry solutions and enhancing the value of our "energy butler"brand. In 2025, our Energy business achieved revenue of RMB4,813 million, a year-on-year increase of 7.5%, of which the battery exchange business accounted for RMB3,029 million, an increase of21.2% year-on-year, and with its contribution to the Energy business reaching 62.9%.
Innovation strategy resulted in remarkable technology empowerment
We made concrete progress in developing the "four lists" working mechanism of competencies and capabilities, task and project planning, resource allocation, and the commercialization of research outcomes. Focusing on the "One Core and Two Wings" businesses, we continued to intensify our efforts to address the challenges in key and core technologies, and accelerated the transformation of technological achievements to inject new momentum into high-quality business development. In 2025, our R&D investment and the number of R&D personnel increased by 82% and 22% respectively, compared to 2024. The number of patent applications and the cumulative number of patent authorizations increased by 77% and 54%, respectively, compared to the year before. We participated in the formulation of multiple international standards. A range of innovative products were commercialized and deployed at scale such as shared micro repeaters, monitoring platforms, and "one code for all". Our technological innovation system continued to strengthen, as shown in the high-quality construction and development of six regional technological innovation centers, the expansion and quality improvement of joint innovation platforms, and the steady enhancement of innovation efficiency and performance.
Mr. Zhang Zhiyong, Chairman of China Tower said, "In 2025, we remained focused on high-quality development, promoting stability through progress while improving quality and efficiency. As a result, throughout the year our business maintained healthy, steady growth and demonstrated a positive outlook. Looking ahead, we will continue to uphold the philosophy of resource sharing and adhere to the "One Core and Two Wings" strategy to further enhance our core competitiveness, promote high-quality development, and create value for shareholders, customers, and society."
[1] EBITDA is calculated by operating profit plus depreciation and amortization.
[2] EBITDA margin is calculated by dividing EBITDA by operating revenue, and multiplying the resulting value by 100%.
[3] Free cash flow is the net cash generated from operating activities minus the capital expenditures.
[4] Gearing ratio is calculated as net debts divided by the sum of total equity and net debt, then multiplying the result by 100%. Net debt is calculated as the amount of interest-bearing liabilities minus the amount of cash and cash equivalents.
About China Tower (Stock Code:0788.HK)
China Tower is the world's largest telecommunications tower infrastructure service provider, and the Company always adheres to the philosophy of shared development and implements the "One Core and Two Wings" strategy. The Company is principally engaged in the construction, maintenance and operation of base station ancillary facilities such as telecommunications towers, public network coverage in railway tunnels and subways, and large-scale indoor Distributed Antenna Systems (DAS). Meanwhile, relying on unique resources to provide energy application services such as information application and intelligent battery exchange and power backup to the society, the Company strives to build itself into a world-class integrated digital infrastructure service provider, and a highly competitive information and new energy applications provider. As of the end of 2025, the Company's total assets amounted to RMB336,579 million. China Tower operated and managed 2.119 million tower sites across 31 provinces, municipalities and autonomous regions in the PRC, and served over 3.856 million tenants with the tenancy ratio of 1.79.
Contact:
Strategic Financial Relations Limited
Vicky Lee / Corinne Ho / Maggie Zhang
Tel: (852) 2864 4834 /2114 4911 / 2114 4903
Email: sprg_chinatower@sprg.com.hk
SOURCE: China Tower Corporation Limited
View the original press release on ACCESS Newswire
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- China Tower (SEHK:788): Assessing Valuation After Consistent 1-Year Outperformance
Nov 8, 2025
China Tower (SEHK:788) shares have seen steady movement recently, gaining around 1% in the past month and delivering a 16% return over the past year. For long-term investors, these numbers highlight consistent performance through shifting market cycles.
See our latest analysis for China Tower.
Momentum around China Tower appears to be picking up, with a 1.05% gain in the share price just in the past day and a steady climb driving a robust 1-year total shareholder return of 15.9%. The combination of recent price action and longer-term outperformance suggests that investor sentiment is warming as the company continues to execute on growth opportunities.
If you’re looking to broaden your search beyond the usual names, now is an ideal time to discover fast growing stocks with high insider ownership.
With shares trading at a discount to analyst price targets and double-digit annual net income growth, the question now is whether China Tower is undervalued at current levels or if the market is already factoring in its future expansion.
Most Popular Narrative: 14% Undervalued
China Tower's widely-followed narrative places its fair value significantly above the recent closing price, implying meaningful upside if current assumptions play out. The stage is set for structural change, fueled by sector transformation and new high-margin digital infrastructure.
Growth in 5G deployment and digital transformation is fueling demand for core tower assets and smart infrastructure. This drives stable revenue and creates new high-margin opportunities. Diversification into non-telecom sectors and disciplined cost control are enhancing profitability, supporting cash flow, and lowering risk from customer concentration.
Read the complete narrative.
The real story behind the valuation? The narrative relies on bold earnings expansion, digital transformation, and a future profit margin that few in the sector achieve. Want to see the precise growth forecasts and what makes this price target compelling? Find out how aggressive revenue and margin projections set this narrative apart from others.
Result: Fair Value of $13.45 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, slowing growth in core tower revenue and uncertain returns from new business lines could challenge bullish expectations for China Tower’s long-term trajectory.
Find out about the key risks to this China Tower narrative.
Build Your Own China Tower Narrative
If you want to form your own perspective, the tools are there. Dive into the data and assemble your own view in just a few minutes. Do it your way
Story Continues
A great starting point for your China Tower research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include 0788.HK.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com
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- China Tower (788.HK) Announces 2025 Interim Results
Aug 5, 2025
Deepening "One Core and Two Wings" Strategic Layout
Steady Improvement in Business Quality Continuously Enhancing Shareholder Returns
HONG KONG SAR / ACCESS Newswire / August 5, 2025 / The world's largest telecommunications infrastructure service provider China Tower Corporation Limited ("China Tower", or the "Company") (Stock Code: 0788.HK) is pleased to announce its interim results for the six months ended 30 June 2025.
Performance Highlights
RMB Million 1H 2025 1H 2024 Change Operating revenue 49,601 48,247 2.8% EBITDA[1] 34,227 33,045 3.6% Profit attributable to owners of the Company 5,757 5,330 8.0% Basic earnings per share (RMB yuan) (Re-presented) 0.3293 0.3049 8.0% Dividend per share (RMB yuan) 0.13250 0.01090 21.6%[2] Key operating data Number of tower sites (thousand) 2,119 2,070 2.4% Number of tower tenants (thousand) 3,844 3,731 3.0% Tenancy ratio (tenants / tower site) 1.81 1.80 0.6%
In the first half of 2025, the Company's operating revenue maintained steady growth, reaching RMB49,601 million, an increase of 2.8% year-on-year. EBITDA reached RMB34,227 million, an increase of 3.6% year-on-year, with an EBITDA margin [3] of 69.0%. Profit attributable to the owners of the Company reached RMB5,757 million, an increase of 8.0% year-on-year, with a net profit margin of 11.6%, demonstrating a continuous improvement in profitability.
Net cash generated from operating activities amounted to RMB28,679 million, a decrease of RMB4,151 million year-on-year. Capital expenditures stood at RMB12,392 million, with free cash flow [4] reaching RMB16,287 million, down by RMB2,814 million year-on-year. As at 30 June 2025, our total assets amounted to RMB331,127 million, with interest-bearing liabilities of RMB92,639 million and a gearing ratio [5] of 29.5%, representing a decrease of 1.5 percentage points from the end of 2024. Financial position remains healthy and stable.
The Company attaches great importance to shareholder returns. After considering our profitability, cash flow and future development needs, the board of directors of the Company has resolved to distribute an interim dividend of RMB0.13250 per share (pre-tax). We will work towards realizing healthy growth in annual dividend payment per share and creating greater value for shareholders.
Strong foundation helped maintain stable performance in TSP business
The Company fully delivered on its role as part of a nationwide consortium of telecommunication infrastructure developers and as the leading force in new 5G infrastructure construction. We further overcame challenges in the Dual-Gigabit network joint-entry, as well as implementing special projects such as upgrading signal strength and extending broadband coverage to all border areas. We were able to capture opportunities presented by the continuous expansion of 5G network penetration and coverage in China. By working to improve resource coordination and sharing, and enhancing our professional operations, we were able to fully satisfy customer network construction needs and maintain stable growth in the TSP business. In the first half of 2025, our TSP business recorded revenues of RMB42,461 million, an increase of 0.8% year-on-year.
Story Continues
Tower business . We implemented an embedded service mechanism to strengthen customer communications and engagement with a focus on TSPs' network construction planning. By doing so we were able to acquire orders by customer types and by network standards/frequency bands. Based on site resource data, we proactively conducted network coverage analysis to identify weak coverage areas, enabling the development of comprehensive solutions and regional products to meet customer needs. We focused on resolving customer pain points, continuously tackling difficult sites to gain customer recognition while fully acquiring and addressing customer demands. By adhering to a customer-oriented philosophy, we constantly optimized our business processes, standardized business management, and improved the efficiency of order acquisition and delivery as well as billing and payment collection, in order to enhance service capabilities and customer satisfaction. In the first half of 2025, our Tower business revenue reached RMB37,797 million, maintaining at about the same level year-on-year. As of 30 June 2025, the Company managed a total of 2.119 million tower sites, an increase of 25,000 sites compared to the end of 2024. We gained 35,000 new TSP tenants since the end of 2024, bringing the total number of TSP tenants to 3.579 million. Our TSP tenancy ratio was 1.72.
DAS business . Maintaining a clear focus on high-value scenarios, the Company continued to strengthen its resource coordination and sharing capabilities for key sites such as large transportation hubs, subways, large venues, Grade 3A hospitals, tertiary institutions, and landmark buildings. We collaborated with TSPs to accelerate 5G network upgrades on high-speed railways, achieving a larger share of high-value scenario orders. By furthering joint construction and shared development, we have improved coverage efficiency and unleashed our advantages in coordinated site entry and construction. We supported TSPs in swiftly and economically expanding network coverage to improve people's livelihoods through scale deployment of shared repeaters in elevators, underground parking lots, highway tunnels, residential properties and other sites. We accelerated 5G upgrades and continuously optimized active and passive DAS sharing solutions to enhance product competitiveness. We piloted shared frequency-shifting solutions during the 5G upgrades of existing DAS to ensure that the network quality improves in line with customer requirements. In the first half of 2025, our revenue from DAS business reached RMB4,664 million, an increase of 12.0% compared to the same period last year, maintaining relatively high growth. As of 30 June 2025, we had covered buildings with a cumulative area of 13.85 billion square meters, up by 20.0% year-on-year, while the coverage in high-speed railway tunnels and subways reached a cumulative length of 30,878 kilometers, representing an increase of 17.0% year-on-year.
Refined operations to boost rapid development of Two Wings business
We continued to strengthen product innovation and optimized business planning to improve our core competencies and promote further development of our Two Wings business, realizing rapid revenue and scale expansion. In the first half of 2025, revenues from our Two Wings business reached RMB6,935 million, accounting for 14.0% of our overall operating revenue and representing an increase of 1.6 percentage points over the same period last year.
Smart Tower business. Focusing on spatial digital intelligence governance, we leveraged our rich resources and capabilities to transform "telecommunication towers" to "digital towers", which supported national strategies and major projects while improving the quality of our Smart Tower business. In terms of identifying customer demands , we further developed the Smart Tower business across vertical sectors and promoted strategic cooperation with a list-based approach. Our market share expanded and leadership consolidated across key scenarios such as farmland protection, fisheries law enforcement, bushfire prevention, disaster alert, and emergency rescue. Interms of refining our products , we advanced the construction and operations of the distributed platform and optimized our distinctive algorithm warehouse for mid-to-high points. We developed high-quality data sets for digital intelligent governance, further improving the competitiveness of products in key service scenarios. In terms of upgrading service delivery , we continued to elevate the service quality for customers in key industries, centering around the development of high-standard service systems. We reinforced service process management and advanced service upgrades for major projects and key service scenarios. We reinforced our local support and service teams to ensure swift response to customers' incremental development requirements, continuously enhancing our "companion" service capabilities. In terms of strengthening security , we solidified measures by deepening closed-loop management of network information security risks and improving the technical protection system. We carried out special initiatives to comprehensively enhance technical protection capabilities for network information security across data, terminals, platforms, and cloud networks. In the first half of 2025, our Smart Tower business achieved revenue of RMB4,726 million, a year-on-year increase of 18.7%. Of which, RMB2,822 million was generated from Tower Monitoring business, accounting for 59.7% of our Smart Tower business.
Energy business. We focused on key business segments such as battery exchange and power backup, leveraging core competitiveness in product, service, and platform. We carried out refined operation and turned our Energy business into a specialized business stream. For the batteryexchange business , we strengthened our presence in the consumer food delivery market while accelerating expansion among corporate customers. We established a VIP user management system to improve service capabilities and customer retention, driving rapid growth in our user base. As of 30 June 2025, we had approximately 1.470 million battery exchange users, an increase of 166,000 from the end of 2024, further maintaining our leading position in battery exchange for low-speed electric vehicles. Drawing on effective resource allocations, we accelerated the construction of a community charging infrastructure network system, improved operation and management capabilities, provided safe charging services for low-speed electric vehicles to the community, and continuously expanded the scale of service users. For the power backup business , we tapped into pivotal industries such as telecommunications and finance, along with key scenarios, to expand our premium customer base, analyze customer needs, strengthen capabilities, promot a comprehensive "power backup +" industry solution and forge China Tower "energy butler" brand. In the first half of 2025, our Energy business achieved revenue of RMB2,209 million, a year-on-year increase of 9.2%. Of which, the battery exchange business accounted for RMB1,323 million, contributing to 59.9% of the Energy business revenue.
Technological innovation steadily generated positive impact
In the first half of the year, we continued to strengthen technological innovation, building robust momentum for sustainable development. We intensified R&D efforts in critical technologies, including next-generation mobile communications, AI, edge computing, 5G + BeiDou integration, 5G shared DAS, new energy solutions and Internet of Things. We focused on establishing major projects and technical standards with international and industrial impact. By releasing a series of achievement lists, smoothing transformation channels, conducting scientific and technological achievement evaluations, and promoting transformation through categorized measures, we accelerated the channeling of technological achievements into production. We further promoted the management of the "four lists", namely competencies and capabilities, task and project planning, resource allocation, and the commercialization of research outcomes, to steadily improve the efficiency and performance of innovation. In the first half of 2025, our R&D team size increased by 29%, compared to the same period last year, while the cumulative number of patent authorizations rose by 16% since the end of 2024.
Mr. Zhang Zhiyong, Chairman of China Tower said, "During the first half of 2025, we continued to optimize resource allocation, deepen reform and innovation, promote stable and high-quality operations and development, and improve corporate efficiency, further enhancing our core competitiveness. Looking ahead, we will continue to uphold the philosophy of resource sharing and adhere to the 'One Core and Two Wings' strategy to further enhance our core competitiveness, promote high-quality development, and maximize value for shareholders, customers, and society."
[1] EBITDA is calculated by operating profit plus depreciation and amortization.
[2] The Company's share consolidation and capital reduction took effect on 20 February 2025. The Company's total issued share capital was reduced from 176,008,471,024 shares to 17,600,847,102 shares. Taking into account the aforementioned change in total issued share capital, the growth rate is calculated based on the total amount of dividends.
[3] EBITDA margin is calculated by dividing EBITDA by operating revenue, and multiplying the resulting value by 100%.
[4] Free cash flow is the net cash generated from operating activities minus the capital expenditures.
[5] Gearing ratio is calculated as net debt (Interest-bearing liabilities minus the amount of cash and cash equivalents) divided by the sum of total equity and net debt, then multiplied by 100%.
About China Tower (Stock Code: 0788.HK)
China Tower is the world's largest telecommunications tower infrastructure service provider, and the Company always adheres to the philosophy of shared development and implements the "One Core and Two Wings" strategy. The Company is principally engaged in the construction, maintenance and operation of base station ancillary facilities such as telecommunications towers, public network coverage in high-speed railways and subways, and large-scale indoor Distributed Antenna Systems (DAS). Meanwhile, relying on unique resources to provide energy application services such as information application and intelligent battery exchange and power backup to the society, the Company strives to build itself into a world-class integrated digital infrastructure service provider, and a highly competitive information and new energy applications provider. As of the end of June 2025, the Company's total assets amounted to RMB331,127 million. China Tower operated and managed 2.119 million tower sites across 31 provinces, municipalities and autonomous regions in the PRC, and served over 3.844 million tenants with the tenancy ratio of 1.81.
Contact:
Strategic Financial Relations Limited
Vicky Lee / Corinne Ho / Maggie Zhang
Tel: (852) 2864 4834 /2114 4911 / 2114 4903
Email: sprg_chinatower@sprg.com.hk
SOURCE: China Tower Corporation Limited
View the original press release on ACCESS Newswire
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- China Tower Corp Ltd (CHWRD) (FY 2024) Earnings Call Highlights: Strong Profit Growth Amid ...
Mar 20, 2025
Release Date: March 17, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
China Tower Corp Ltd (CHWRD) reported a 10% increase in net profit for 2024, indicating strong financial performance. The company achieved sustained revenue growth, with total operating revenue reaching RMB 97.77 billion, a 4% year-on-year increase. The dividend payout ratio increased to 76%, reflecting a commitment to returning value to shareholders. China Tower Corp Ltd (CHWRD) upgraded 230,000 telecom towers to digital towers, enhancing service capabilities across various industries. The company significantly improved its cash flow, with net cash flow from operating activities reaching RMB 59.47 billion, a substantial increase from the previous year.
Negative Points
The power backup business experienced a year-on-year revenue decline of 4.6%, indicating challenges in this segment. Operating expenses increased by 2.4% year-on-year, which could impact overall profitability if not managed effectively. The liability to asset ratio stood at 30.9%, which may raise concerns about the company's leverage and financial stability. Despite revenue growth, the tower business only saw a modest increase of 0.9%, suggesting limited expansion in this core segment. Employee benefits and expenses rose by 8.2% year-on-year, potentially affecting the company's cost structure and margins.
Q & A Highlights
Warning! GuruFocus has detected 9 Warning Signs with CHWRD.
Q: Can you elaborate on the company's strategy for expanding the 5G network and its impact on revenue growth? A: Mr. Zhao Zhiyong, Chairman: The company has actively seized opportunities from 5G network penetration and coverage, improving resource coordination and sharing. In 2024, 412,000 5G base stations were built, bringing the total to 2.759 million. More than 95% of 5G projects were delivered through site co-location, contributing to a 2.4% increase in the TSP tenancy ratio year on year. This strategic focus has supported steady revenue growth in our TSP business.
Q: How has the company managed to improve its cash flow significantly in 2024? A: Mr. Hu Xiaofeng, Chief Accountant: The company implemented a special project to reduce costs and increase efficiency, alongside strengthening benchmarking evaluations and management of individual sites. As a result, net cash flow from operating activities increased by RMB16.63 billion year on year, reaching RMB59.47 billion. This improvement was also supported by effective CapEx management and enhanced payment collection from TSP customers.
Story Continues
Q: What are the key drivers behind the growth in the smart tower business? A: Mr. Chen Li, General Manager: The smart tower business saw rapid growth, with revenue increasing by 22.4% year on year. Key drivers include leveraging our vast resource endowment, enhancing product innovation, and focusing on key industries such as emergency response and agriculture. We upgraded 230,000 telecom towers to digital towers, which helped maintain our leading position in new market shares.
Q: Could you provide more details on the company's R&D investments and their outcomes? A: Mr. Zhao Zhiyong, Chairman: In 2024, R&D expenses increased by 40% year on year, with a focus on AI, green and low-carbon technologies, and edge computing networks. The number of granted patents rose by 68%, and we achieved five international standards. These investments have strengthened our technological innovation system and enhanced our competitive edge.
Q: How is China Tower addressing environmental and social responsibilities? A: Mr. Zhao Zhiyong, Chairman: The company actively promotes green transformation by reducing carbon emissions through co-building and co-sharing base stations. We also focus on social welfare, such as emergency rescue work and improving communication infrastructure in remote areas. These efforts align with our commitment to sustainable development and social responsibility.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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- China Tower Continues to Deepen "One Core and Two Wings" Development Strategy
Mar 17, 2025
Revenue Growth Supported by Multiple Pillars
Steadily Enhancing Shareholder Returns
HONG KONG, SAR / ACCESS Newswire / March 17, 2025 / The world's largest telecommunications infrastructure service provider China Tower Corporation Limited ("China Tower" or the "Company") (Stock Code:0788.HK) is pleased to announce its annual results for the year ended 31 December 2024.
Performance Highlights
RMB Million 2024 2023 Change Operating revenue 97,772 94,009 4.0 % EBITDA 66,559 63,551 4.7 % Profit attributable to owners of the Company 10,729 9,750 10.0 % Basic earnings per share (RMB yuan) 0.6138 0.5578 (Restated) 10.0 % Full-year dividend per share (RMB yuan) 0.41696 0.37390 (Restated) 11.5 % Key operating data Number of tower sites (thousand) 2,094 2,046 2.3 % Number of tower tenants (thousand) 3,791 3,658 3.6 % Tenancy ratio (tenants / tower site) 1.81 1.79 1.1 %
In 2024, the Company's operating revenue maintained steady growth, reaching RMB97,772 million, an increase of 4.0% year-on-year. EBITDA reached RMB66,559 million, an increase of 4.7% year-on-year, with an EBITDA margin of 68.1%. Profit attributable to the owners of the Company reached RMB10,729 million, an increase of 10.0% year-on-year, with a net profit margin of 11.0%, demonstrating a continuous improvement in profitability.
Net cash generated from operating activities amounted to RMB49,468 million, an increase of RMB16,628 million year-on-year. Capital expenditures stood at RMB31,941 million, with free cash flow reaching RMB17,527 million, up by RMB16,402 million year-on-year. As at 31 December 2024, our total assets amounted to RMB332,834 million, with interest-bearing liabilities of RMB92,542 million and a gearing ratio of 31.0%, representing a decrease of 0.4 percentage point from the end of 2023. Our financial position remains healthy and stable.
The Company attaches great importance to shareholder returns. After considering our profitability, cash flow and future development needs, the board of directors of the Company has recommended a final dividend of RMB0.30796 per share (pre-tax) for the year ended 31 December 2024. Together with the interim dividend distributed, the total full-year dividend amounted to RMB0.41696 per share (pre-tax) 5, representing an increase of 11.5% compared to 2023 and equivalent to a payout ratio of 76% of our annual distributable net profit.
Solid foundation enabled stable growth in TSP Business
The Company fully delivered the its role as part of a nationwide consortium of telecommunication infrastructure developers and as the leading force in new 5G infrastructure construction. We further overcame challenges in the Dual-Gigabit network joint-entry implementation, as well as in special projects such as upgrading signal strength and extending broadband coverage to all border areas. We were able to capture opportunities presented by the continuous expansion of 5G network penetration and coverage in China. By working continuously to improve resource coordination and sharing, and enhancing our professional operations, we were able to fully satisfy customer network construction needs and maintain stable growth in the TSP business. In 2024, our TSP business recorded a revenue of RMB84,119 million, an increase of 2.4% year-on-year.
Story Continues
Tower business. We focused on high-traffic and high-value scenarios that are of keen interest to our customers, as well as other key scenarios such as high-speed railways, highways, borders and rural areas. We conducted targeted and purposive scenario-based coverage analysis and site planning, strengthened efforts to tackle difficult sites, and supported customers in building 5G premium networks in an intensive and effective manner. We developed and deployed a 3D indoor and outdoor simulation support system to visualize the coverage of planned sites and construction solutions, helping TSPs accurately implement their network coverages. By adhering to a customer-oriented philosophy, we constantly optimized our business processes, standardized business management, and improved the efficiency of order acquisition and delivery, billing and payment collection, enhancing service capabilities and customer satisfaction. In 2024, our revenue from the Tower business amounted to RMB75,689 million, an increase of 0.9% from the previous year. As at 31 December 2024, the Company managed a total of 2.094 million tower sites, an increase of 48,000 year-on-year. We have gained 120,000 new TSP tenants since the end of 2023, bringing the total number of TSP tenants to 3.544 million. Our TSP tenancy ratio increased from 1.68 at the end of 2023 to 1.72, further improving the level of co-location.
DAS business. We continued to strengthen our coordination and sharing capabilities for key scenarios such as large transportation hubs, landmark buildings, subways, large venues, Grade 3A hospitals and tertiary institutions. We collaborated with customers to carry out 5G upgrades on high-speed railways and unleashed more demand for high-value scenarios. Leveraging our advantages of coordinated site entry and construction, and our co-building and co-sharing policies, we actively implemented special projects for covering elevators and underground parking lots and expanded the deployment of shared low-power repeaters to help TSPs quickly and efficiently improve network coverage to elevate people's livelihoods. We continued to enhance product and solution design capabilities and innovation in DAS shared products, which enabled us to provide customers with differentiated active and passive DAS sharing solutions, meeting the demand for upgrading of existing DAS to 5G network. In 2024, our revenue from the DAS business reached RMB8,430 million, an increase of 18.1% year-on-year. As at 31 December 2024, we had covered buildings with a cumulative area of 12.68 billion square meters, up by 24.9% year-on-year, while high-speed railway tunnels and subway coverage reached a cumulative length of 29,315 kilometers, up by 21.8% year-on-year.
Forged strengths to achieve healthy growth of Two Wings business
During the year, in view of the opportunities brought about by the development of the digital economy and the "Dual Carbon" goals, we worked continuously to strengthen product innovation, optimized business planning, further improved our core competencies, and promoted the healthy development of our Two Wings business. In 2024, the revenue of the Two Wings business reached RMB13,388 million and accounted for 13.7% of our overall operating revenue, an increase of 1.5 percentage points over the same period last year.
Smart Tower business. We fully leveraged our core capabilities and advantages in spatial digital intelligence governance to serve the national development strategies of "Digital China" and "Beautiful China", continuously refining our Smart Tower business. We expanded our Smart Tower business across vertical sectors to consolidate our leading position. This was achieved by deepening strategic cooperation with key customers, creating premium projects across various industry segments. As a result, we secured leadership in incremental domestic market share in a number of key scenarios such as disaster alert and farmland protection. We enhanced research and innovation to foster core capabilities. In these areas, we fortified the distributed deployment on our platform and strengthened algorithm development for mid-to-high point scenarios, building a strong platform foundation, focusing on key service scenarios. We identified additional customer demands to promote service upgrades. This saw us enhancing our localized technical support teams and improving our "companion" service capabilities to meet customers' iterative development needs in a timely manner and achieved high-quality project delivery. Relying on the large-scale operation and maintenance system, we built a professional network management platform, equipped with the ability to accurately diagnose incidents occurring in the terminal devices, dispatch tasks in real time and handle incidents in a timely manner. We deepened service integration and strengthened industry collaboration. By expanding our partner base, signing strategic cooperation agreements with tertiary institutions and leading enterprises, we achieved coordinated development. In 2024, the Smart Tower business generated revenue of RMB8,911 million, up by 22.4% year-on-year, among which, revenue from our Tower Monitoring business reached RMB5,539 million, accounting for 62.2% of our revenue from the Smart Tower business.
Energy business. We focused on key business segments such as battery exchange and power backup, refining operations and solidifying product, service and platform competitiveness in order to turn Energy business into a specialized business stream. For the battery exchange business, we continued to engage users more effectively in the delivery and courier markets, enhancing service capabilities and achieving stable user growth. As at 31 December 2024, the number of battery exchange users reached 1.304 million, an addition of 159,000 since the end of 2023, further maintaining our leading position in the market for battery exchange for low-speed electric vehicles. We leveraged the opportunities brought about by national policies on safe charging, giving full play to our own capabilities and advantages in laying out economic and efficient community charging infrastructure and providing safe and convenient battery charging services for low-speed electric vehicles to the community. These efforts helped expand our customer base of our battery exchange business. For the power backup business, we focused on pivotal industries such as telecommunications and finance, along with key scenarios, to expand our premium customer base. We used our reliable power backup service as an entry point to explore the demand for monitoring, energy consumption management and maintenance services, providing a comprehensive "power backup +" industry solution and forging the "energy butler" brand. In 2024, our Energy business achieved revenue of RMB4,477 million, a year-on-year increase of 6.2%, of which the revenue from battery exchange business accounted for RMB2,500 million, with its contribution to the Energy business reaching 55.8%.
Mr. Zhang Zhiyong, Chairman of China Tower said, "Looking ahead, under the guidance of our established strategy, we will seek to further deepen our ‘One Core and Two Wings' strategy, enhance our core competitiveness to ensure a robust foundation for our solid and high-quality development, and achieve increased growth in our enterprise value, while creating greater returns for our shareholders, customers and society."
About China Tower (Stock Code:0788.HK)
China Tower is the world's largest telecommunications tower infrastructure service provider, and the Company always adheres to the philosophy of shared development and implements the "One Core and Two Wings" strategy. The Company is principally engaged in the construction, maintenance and operation of base station ancillary facilities such as telecommunications towers, public network coverage in high-speed railways and subways, and large-scale indoor Distributed Antenna Systems (DAS). Meanwhile, relying on unique resources to provide energy application services such as information application and intelligent battery exchange and power backup to the society, the Company strives to build itself into a world-class information and communications infrastructure service provider, and a highly competitive information and new energy applications provider. As of the end of December 2024, the Company's total assets amounted to RMB332,834 million. China Tower operated and managed 2.094 million tower sites across 31 provinces, municipalities and autonomous regions in the PRC, and served over 3.791 million tenants with the tenancy ratio of 1.81.
Investor and Media Enquiries
Strategic Financial Relations Limited
Vicky Lee / Corinne Ho
Tel: (852) 2864 4834 /2114 4911
Email: sprg_chinatower@sprg.com.hk
SOURCE: China Tower Corporation Limited
View the original press release on ACCESS Newswire
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- Don’t Buy China Tower Corporation Limited (HKG:788) Until You Understand Its ROCE
May 8, 2020
Today we'll look at China Tower Corporation Limited (HKG:788) and reflect on its potential as an investment. Specifically, we're going to calculate its Return On Capital Employed (ROCE), in the hopes of getting some insight into the business.
First up, we'll look at what ROCE is and how we calculate it. Second, we'll look at its ROCE compared to similar companies. Finally, we'll look at how its current liabilities affect its ROCE.
Understanding Return On Capital Employed (ROCE)
ROCE is a metric for evaluating how much pre-tax income (in percentage terms) a company earns on the capital invested in its business. In general, businesses with a higher ROCE are usually better quality. Overall, it is a valuable metric that has its flaws. Renowned investment researcher Michael Mauboussin has suggested that a high ROCE can indicate that 'one dollar invested in the company generates value of more than one dollar'.
How Do You Calculate Return On Capital Employed?
The formula for calculating the return on capital employed is:
Return on Capital Employed = Earnings Before Interest and Tax (EBIT) ÷ (Total Assets - Current Liabilities)
Or for China Tower:
0.059 = CN¥12b ÷ (CN¥338b - CN¥128b) (Based on the trailing twelve months to March 2020.)
So, China Tower has an ROCE of 5.9%.
See our latest analysis for China Tower
Does China Tower Have A Good ROCE?
One way to assess ROCE is to compare similar companies. We can see China Tower's ROCE is around the 6.1% average reported by the Telecom industry. Setting aside the industry comparison for now, China Tower's ROCE is mediocre in absolute terms, considering the risk of investing in stocks versus the safety of a bank account. Investors may wish to consider higher-performing investments.
We can see that, China Tower currently has an ROCE of 5.9% compared to its ROCE 3 years ago, which was 4.7%. This makes us think about whether the company has been reinvesting shrewdly. You can see in the image below how China Tower's ROCE compares to its industry. Click to see more on past growth.
Story continues SEHK:788 Past Revenue and Net Income May 8th 2020
It is important to remember that ROCE shows past performance, and is not necessarily predictive. Companies in cyclical industries can be difficult to understand using ROCE, as returns typically look high during boom times, and low during busts. This is because ROCE only looks at one year, instead of considering returns across a whole cycle. Since the future is so important for investors, you should check out our freereport on analyst forecasts for China Tower.
Do China Tower's Current Liabilities Skew Its ROCE?
Current liabilities are short term bills and invoices that need to be paid in 12 months or less. Due to the way ROCE is calculated, a high level of current liabilities makes a company look as though it has less capital employed, and thus can (sometimes unfairly) boost the ROCE. To check the impact of this, we calculate if a company has high current liabilities relative to its total assets.
China Tower has total assets of CN¥338b and current liabilities of CN¥128b. As a result, its current liabilities are equal to approximately 38% of its total assets. China Tower's ROCE is improved somewhat by its moderate amount of current liabilities.
What We Can Learn From China Tower's ROCE
Despite this, its ROCE is still mediocre, and you may find more appealing investments elsewhere. You might be able to find a better investment than China Tower. If you want a selection of possible winners, check out this freelist of interesting companies that trade on a P/E below 20 (but have proven they can grow earnings).
If you like to buy stocks alongside management, then you might just love this freelist of companies. (Hint: insiders have been buying them).
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
- Edited Transcript of 0788.HK earnings conference call or presentation 18-Mar-20 12:00pm GMT
Apr 9, 2020
Full Year 2019 China Tower Corp Ltd Earnings Call Apr 9, 2020 (Thomson StreetEvents) -- Edited Transcript of China Tower Corp Ltd earnings conference call or presentation Wednesday, March 18, 2020 at 12:00:00pm GMT TEXT version of Transcript ================================================================================ Corporate Participants ================================================================================ * Chunlei Gao China Tower Corporation Limited - Chief Accountant * Jilu Tong China Tower Corporation Limited - Chairman * Xiaomin Gu China Tower Corporation Limited - GM & Executive Director ================================================================================ Presentation -------------------------------------------------------------------------------- Jilu Tong, China Tower Corporation Limited - Chairman [1] -------------------------------------------------------------------------------- Good evening, ladies and gentlemen. Unfortunately, affected by the pandemic, this announcement can only be held through a conference call. Welcome to China Tower's 2019 Annual Results Announcement. Now I would like to introduce the management attending today's results briefing. Our Executive Director and General Manager, Mr. Gu Xiaomin; Chief Accountant, Mr. Gao Chunlei; Deputy General Manager, Mr. Liu Guofeng; and Deputy General Manager, Mr. Zhang Quan. Here's the agenda for today's annual results announcement. Firstly, I will briefly introduce the company's overall performance in 2019. Then Mr. Gu Xiaomin and Mr. Gao Chunlei will introduce the operational and financial performance, respectively. At the end, we will have a Q&A session. 2019 is the first year for China to put 5G into commercial use and is also the first year for our company to carry out its One Core Two Wings development strategy. Over the year, we reinforced the philosophy of resource sharing, maintained an overall stable business development and continuously improved our quality and efficiency. Performance highlights of 2019 are as follows: first, overall performance remained stable, efficiency improved continuously; second, sound implementation of corporate strategy, furthered resource sharing; third, optimized business structure, distinguished competitive advantages; fourth, deepened reform and innovation, strengthened business development momentum. In 2019, the overall performance of our company maintained steady growth with sound business momentum. Thanks to the continued and stable growth of revenue, our operating efficiency enhanced steadily. EBITDA reached RMB 56.7 billion, increased by 6% year-on-year on the comparable basis. Net profit reached RMB 5.2 billion, up by 97.1% year-on-year. Driven by stable revenue growth and effective cost control, operating profit increased steadily to RMB 11.28 billion, increased by 12.6% year-on-year on the comparable basis. The company further implemented its sharing strategy. The average tenants per tower sites increased to 1.62, showing further improvements in the level of site colocation. Adhered to the One Core Two Wings strategy. We actively promoted resource sharing and win-win philosophy to boost the development of our TSP business. Through leveraging the scale of our resources, we accelerated to expand our Two Wings business. We continue to maintain overall stable and healthy revenue growth and optimize the business structure. In 2019, we recorded an operating revenue of RMB 76.43 billion, up by 6.4% year-on-year. Revenue from tower business increased by 4.1% year-on-year, contributing 93.4% of the total revenue. While revenue from non-tower businesses including DAS and Two Wings businesses, contributing 6.6% of total revenue, up by 2.1 percentage points year-on-year. In 2019, we further promoted resource sharing within the industry, promoted the construction of 5G network to support the national strategies. The colocation level further improved, with the site colocation ratio of new tenants reached 80%. While accelerating the resource sharing within the industry, we further extended our sharing philosophy to the wider society and promoted the mutual sharing of telecommunication tower and public utility tower. On one hand, we promoted the sharing of social pole resources within the industry and strengthened access to and utilization of social resources to reduce construction costs. At present, 84% of the company's newly built small cells were fulfilled by social resources. While the same for macro cells were 17%. On the other hand, we promoted the multiple uses of towers and poles and promoted the sharing of telecommunication tower with the wider society to serve the information application of various sectors. Meanwhile, aware of the energy supply demands in society, we extended the sharing philosophy to energy industry and actively deployed energy services. In addition, by delivering solutions from traditional single site colocation to integrated site sharing of towers, shelters, transmission, power supply and maintenance, we have deepened the scope and content of resource sharing and enhanced its value. The company consolidated and further expanded its core advantages, which strengthened its overall competitiveness. As of the end of 2019, we managed a total of 1,994,000 tower sites, holding an absolute dominant market position with over 97% market share. In addition, the company has over 1.3 million of shelters and cabinets equipped with ancillary resources and nearly 12 million reserved social pole resources, which highlighted our advantage on the scale of resources. The company strived to seize favorable external development environment by actively pursuing policy support from government. China Tower has been recognized as a strategic coordinator in the telecommunications infrastructure service industry. With the acceleration of the 5G rollout, local governments have successively introduced policies to support China Tower in coordinating 5G site planning. Meantime, the company has developed extensive cross-industry cooperation with power grids, railways, real estate and municipal transportation entities to achieve a win-win situation. Adhering to the Internet-based management model, the company achieved intensive and delicacy management of assets and resources. In terms of the number of sites managed per employee, the company also outperformed its international peers. Our company adhered to market-oriented development in 2019 and accelerated the innovation and transformation in key sectors to stimulate its internal vitality for development. In terms of dynamic institutional systems and mechanisms, we set up Two Wings business subsidiaries to achieve more professional operation and management. We optimized organizational systems and workflow to better meet business development needs and implemented the restricted share incentive scheme to improve market-based incentive mechanism and boosted organizational vitality. In terms of efficient and rational allocation of resources by optimizing the budget and performance management system, strengthening the classification and management of our prefectural level companies by benchmarking and improving precision management of the entire investment process, we achieved highly efficient resources utilization. In terms of building innovation systems, we sped up the process of shifting business development from investment-driven to innovation-driven, promoted 5G product innovation and united counterparties to refine R&D system. This provided strong momentum for the company's high-quality development. The company places great importance on shareholder returns. We paid our first final dividend in 2018, the first year after the company's listing. Taking full consideration of the company's profitability, cash flow and future capital expenditure requirements, the Board of Directors proposed to increase the distributable dividend payout ratio to 60% and recommended the payment of a final dividend of RMB 0.01455 pretax per share in 2019. In the future, we will strive to enhance the company's profitability and improve shareholder returns. As we speak, the fast approaching 5G era is driving the transformation and upgrading of the whole information and communications industry, accelerating the promotion of national strategies such as cyberpower and Digital China. This presents enormous opportunities and market space for the company to tap into. Looking ahead to 2020, the company will focus on leveraging our core advantages and further resource sharing. We will accelerate the collaborative development of One Core Two Wings and strive to promote high-quality, more efficient and sustainable development of the company. For TSP business, facing the scaling up of 5G network construction, we strive to deliver excellent services in a low-cost and high-quality manner, so as to promote sustainable and stable development of TSP business. For Two Wings business, we give full play to our advantages in resources and various capabilities, focusing on the collaborative development of Two Wings business and TSP business. With regard to TSSAI business, we will focus on key industries to strengthen product innovation, consolidate our platform advantages and build ecology by collaborating with other players in the industry to promote high-quality growth. As to energy operation business, we are profit-oriented. We will focus on key sectors and create differentiated competitive advantages to drive business growth. 5G will be put into large-scale commercial use in 2020. It is also a crucial year for the company to implement its One Core Two Wings strategy. We will strive to maintain steady growth in operating revenue and the profit growth rate to outpace revenue growth rate. By achieving new breakthroughs in terms of business scale and enhancing our comprehensive strength, we are able to improve our profitability and to create greater value for shareholders. That's all for my brief introduction of the company's overall performance in 2019. Now please welcome our General Manager, Mr. Gu Xiaomin, to introduce our operational performance. -------------------------------------------------------------------------------- Xiaomin Gu, China Tower Corporation Limited - GM & Executive Director [2] -------------------------------------------------------------------------------- Thank you, Chairman Tong. I will introduce the company's operational performance in 2019 and the key operational strategies in 2020. This table presents comparable data on the company's various business revenue and key indicators, which I will specify next. With the implementation of One Core Two Wings strategy, our multistream revenue growth structure has been gradually formed. In 2019, the company's operating revenue increased by RMB 4,610 million year-on-year. In terms of revenue growth contribution, tower business was still the dominant driver, accounted for 61% of total operating revenue growth with 3.9 percentage points revenue contribution. In the meantime, revenue growth contribution from non-Tower business of DAS, Two Wings and other businesses gradually rose to 39%, among which DAS accounted for 18.2%, while Two Wings and other business accounted for 20.9%, driving a total of 2.5 percentage points revenue contribution. This show an optimized revenue structure. Next, I will introduce the development of business by sector in more detail. In 2019, we reinforced our sharing strategy within the industry and leveraged on the utilization of self-owned and social resources. Additionally, we developed innovative products and solutions to satisfy the wireless network coverage demand from TSP. Tower business maintained steady growth. Tower business recorded operating revenue of RMB 71.41 billion, representing an increase of 4.1% year-on-year. As of the end of 2019, we achieved a net addition of 226,000 TSP tower tenants over 2019, bringing the total number to 3,063,000. TSP tenancy ratio reached 1.54, showing a steady improvement in site colocation level. With regard to our DAS business, we have promoted innovative active and passive DAS construction model, which provided differentiated construction solutions to the customers by exerting our advantage at site planning coordinator and fully leveraged our integrated cost advantage and strengthened external cooperation to achieve rapid and scaled growth on DAS business. As of the end of 2019, the coverage of buildings increased by 1.11 billion square meters, and the length of covered subways and high-speed railway tunnels increased by 483 kilometers and 942 kilometers, respectively. The annual DAS revenue increased by 46.1% year-on-year to RMB 2.66 billion, showing an expanding growth momentum and drove the sustainable and steady growth of TSP revenue. As the construction of 5G has been commenced, the company deepened its resource sharing strategy and fully embraced 5G construction demand through strengthening 5G coordination and planning, accelerating acquisition of 5G resources and promoting innovative 5G technologies to support TSPs with the official commercial use of 5G. In 2019, we have received 265,000 5G base station demand and built 161,000 5G base stations. Of which 97% were expanded and upgraded based on existing site resources. For TSSAI business, by leveraging our towers, shelters and cabinets, power backup and maintenance resources, facing the customer demand in key service sectors like emergency, ecology and environmental, transportation, petroleum and satellite positioning. The company focused on areas such as video surveillance and monitoring, edge computing, information and data collection and smart community. By developing industrial solution and promoting its application, TSSAI business achieved rapid expansion. By the end of 2019, the total number of TSSAI tenants reached 176,000, increased by approximately 35,000 over the last year. The annual TSSAI operating revenue amounted to RMB 1.89 billion, up by 54.4% year-on-year. In 2020, the company will further integrate industrial chain resources, launch a batch of standardized products and promote application across the industry to achieve healthy and rapid growth of TSSAI business. For energy operation business, the company established Energy Tower Corporation Limited in 2019 to promote professional operation of energy business. The company adhered to sharing and collaboration philosophy through leveraging advantages on the strong brand of China Tower, site resources, relationships with property companies, capabilities on construction and maintenance and the visible controllable supervision platform. We provided diversified energy services, including power backup, power generation, charging and battery exchange to the wider society. Following the principle of pilot project first before gradually rolling out, energy business was steadily promoted and got off to a good start. The company is committed to focusing on customer-centered services, knowing what our customer is concerned. We strengthened our service and supporting level by enhancing customer service, strengthening delicacy management and improving maintenance capabilities. Focused on the improvement of service capabilities and enhanced customer service, operating quality was further improved compared with 2018. Focused on the improvement of profitability and strengthened delicacy management, the company managed the use of electricity, site leasing fees and maintenance costs, et cetera, to facilitate quality and efficiency improvement. Focused on the enhancement of efficiency and improved maintenance capabilities, the company implemented standardized and intelligent maintenance procedures. The company also established a maintenance system to support One Core Two Wings business development. Looking back over the past year. The company has maintained orderly operation with optimized business structure and further improved site colocation level. Our revenue maintained steady growth. In 2020, we will boost high-quality development with full vigor to create greater value for shareholders. Our key tasks include the following 5 aspects: first, we will deepen the collaborative development of resource sharing and devote to meet the wireless network coverage demand on scaling up 5G construction to ensure the steady growth of TSP revenue; second, focusing on key sectors and key customers, we will further leverage competitive advantages to strengthen Two Wings business and rapid nurture of new growth engines; third, we will further improve service quality, operating efficiency and profitability, strengthen delicacy management and promote high-quality development; fourth, we will enhance customer services in an all-round way. Through actively promoting service innovation and boosting service efficiency, we aim to provide well-rounded quality service and further raise customers' confidence; fifth, we will strengthen our core competencies in R&D and innovation, cement basic management and constantly improve operating efficiency. Next, please welcome our Chief Accountant, Mr. Gao Chunlei, to introduce the company's financial performance. -------------------------------------------------------------------------------- Chunlei Gao, China Tower Corporation Limited - Chief Accountant [3] -------------------------------------------------------------------------------- Thank you, Mr. Gu. I will introduce the company's financial performance in 2019. The key financial indicators of the company are listed on this table. In 2019, the company invested in strategy oriented to enhance the sharing philosophy and promote delicacy management. Throughout the year, operating performance remains solid, profitability continued to grow, cash flow remained healthy and capital structure remained stable, laying a foundation for the company's sustainable and healthy development. In 2019, the company persisted in delicacy management of individual sites, while reducing costs by benchmarking. Excluding the impact of the application of IFRS 16, operating expenses increased by 5.5% year-on-year. Among them, for depreciation and amortization, the company reduced construction costs by optimizing tower construction plans, benchmarking management of cost and providing integrated solutions for wireless network coverage. Meanwhile, we enhance the equipment's daily maintenance and repair to improve the efficiency of existing assets and the effective control of construction investment. The depreciation and amortization were RMB 45.42 billion, increasing by 4.2% year-on-year on comparable basis. For site operating lease charges, the company highly valued the management of site leasing contracts renewal, benefited from actively acquiring site resources at low-cost and effective control site leasing charges. The annual site operating lease charges were RMB 640 million, representing an increase of 4.1% year-on-year on comparable basis. On repairs and maintenance, the company continuously enhanced the intensive operating mode of centralized monitoring and local maintenance. The company also enhanced its precision maintenance capability and strengthened the control of maintenance costs. The annual repairs and maintenance costs were RMB 5.99 billion, representing a decrease of 2.8% year-on-year. On employee benefits and expenses, the company recruited outstanding industry talents to fulfill its business development needs for Two Wings business and initially activated and implemented restricted share incentive scheme. The annual employee benefits and expenses totaled RMB 5.86 billion, increased by RMB 950 million year-on-year. For other operating expenses. Other operating expenses for the year were RMB 7.24 billion, representing an increase of RMB 820 million year-on-year on comparable basis. The main reasons are the increase of RMB 456 million on business development costs for Two Wings business as its scale kept expanding, and the recognition of RMB 395 million on allowance for credit losses in a prudent manner. Benefiting from the steady growth in operating revenue and efficient control of operating expenses, the company's profitability grew steadily. In 2019, operating profit amounted to RMB 11.28 billion, a year-on-year increase of 12.6% on comparable basis. Meanwhile, in 2019, EBITDA reached RMB 56.7 billion, increased by 6% year-on-year on comparable basis. The EBITDA margin was 57.9%, which continued to maintain at a high level. In 2019, the company achieved net profit of RMB 5.22 billion, representing an increase of 97.1% year-on-year. Net profit margin was 6.8%, increased by 3.1 percentage points over the last year. In 2019, by means of the promotion of integrated solution for wireless network coverage, the company underwent further in resources sharing and leveraged on utilization of self-owned and social resources to satisfy customers' needs for constructions with low cost and high efficiency. Meanwhile, the company persistently enhanced asset management throughout their life cycle and efficiently monitored and controlled the scale of investment. In 2019, the capital expenditures were RMB 27.12 billion and accounted for 35.5% of the revenue, decreased from 36.9% over last year. The maintenance CapEx was RMB 4.2 billion, decreased by 10% over 2018. The company insisted on centralized management of funds and accessed low-cost funding through multiple channels. The comprehensive finance costs remained at a relatively low level. Through effective allocation of funds and improving its service efficiency, cost of funds were gradually reduced. In 2019, the company enjoyed healthy cash flow with the operating cash flow reached RMB 49.94 billion, decreased by 15% over the last year on comparable basis. Key reasons are: first, refunded excess VAT paid reduced by RMB 3.31 billion over the last year; and second, collection period of operating revenue receivables was extended in controllable range. EBITDA maintenance CapEx continued to improve, reaching RMB 52.49 billion, showing a year-on-year increase of 8% on comparable basis. The company maintained a solid capital structure, which effectively supported the company's sustainable and healthy development. The interest-bearing debt was RMB 120.35 billion, decreased by RMB 3.89 billion over the beginning of the year on comparable basis. Liability to asset ratio was 46%, down by 1.1 percentage points over the beginning of the year. Leverage level was further reduced, which was beneficial to the company's profitability and shareholder returns. Gearing ratio maintained at a relatively low level of 38.5%. The stable financial condition provided solid safeguard for the sustainable development of the company. In 2020, the company will further implement the One Core Two Wings strategy, continue to promote delicacy management and improve the profitability of the company to create greater value for shareholders. Thank you.
