China

China Unicom Expects 74.3% Increase in Net Profit for 1H 2017 to RMB 778 Mln

Summary:

  • In a statement to the Shanghai Stock Exchange, China Unicom (CHU.NYSE/600050.SS) has said it expects its net profit for the first half of 2017 to increase 74.3% compared with the same period of 2016 to RMB 778 million.
  • The company also expects its revenue from its main business during the first half to increase 3.2% to RMB 124.1 billion on the same comparison basis.

Why It Matters:

  • The company’s income from Internet businesses increased 5.2% year-over-year to RMB 76.8 billion; income from cable and landline businesses remained flat compared with the first half of 2016 at RMB 46.6 billion.
  • Earlier, China Unicom had posted a RMB 154 million net profit for 2016, down 96% from 2015. Revenue for 2016 declined 1% compared with the previous year to RMB 274.2 billion.
  • Although the first half net profit increased significantly, China Unicom expects its financial performance for the second half to be under pressure as the company has recently cut multiple international roaming fees and competition in the business sector could increase in the second half.