BEIJING-China’s number-two mobile operator, China Unicom, reported a profit increase of 2.7 percent in the first half of the year to 2.25 billion yuan (US$272 million) compared with the same period last year, when profits amounted to 2.19 billion yuan (US$265 million).
Most analysts had expected a profit fall as a result of slow subscriber growth on the company’s CDMA network. Profit forecasts ranged from a low 1.399 billion yuan (US$169 million) to a high 2.529 billion yuan (US$306 million).
Average revenue per user (ARPU) on the GSM network fell to 71.6 yuan (US$8.65) from 92.5 yuan (US$11.18), compared with 106.5 yuan (US$12.87) on the CDMA network. But thanks to 7.04 million new subscribers, total revenue increased despite the fall in ARPU.
Capital expenditure declined 37 percent in the first half of the year. The company promised to pay a dividend for the full year.
In the second half, much will depend on the number of new subscribers Unicom may be able to add to its CDMA network. Uptake was slow in the first half, but increased substantially during the last month and a half. The big question mark is whether subscriber growth will be sustained during the coming months.
A China Unicom vice president said the number of CDMA subscribers surpassed 2 million in the second half of August. The company is adding more than 20,000 users each day. If this growth continues, the ambitious target of 7 million users by the end of the year could still be attained. China Unicom is waging an aggressive marketing campaign to attract more CDMA users.
