CK Hutchison Group released operating results through the year 2023, highlighting improvements in overall economic trends in the second half, although inflation in the US and Europe remained significantly elevated relative to central banks’ targets when excluding food and energy prices
Growth was therefore fluctuating depending on the macro-region of interest: while the United States showed continued resilience, conditions remained challenging in Europe, Hong Kong and mainland China.
Overall, supranational obstacles continued to impact the Ports division as well as its profit contribution Cenovus Energythe latter significantly impacted by FIFO losses due to sharp declines in commodity prices in the fourth quarter, offsetting improved operational performance.
The Telecommunications division, while recording an increase in revenues, was once again negatively impacted by cost price inflation. The Infrastructure division continued to post stable performance, while the Retail division continued to achieve excellent year-on-year growth in the second half despite continued weakness in consumer spending in Hong Kong and mainland China.
The Group continued to pursue value-enhancing transaction activities. Notably, the UK telco merger announced in the first half has entered Phase 1 review by UK antitrust authorities, representing satisfactory progress to date. However, in our country – the holding company recalls – the agreements relating to a proposed network joint venture in Italy were not satisfied and were consequently terminated last February.
CK Hutchison Group Telecom
CK Hutchison Telecom Group (“CKHGT”) revenue was HK$86,814 million (€10,199 million), 4% higher than the previous year in reported currency. EBITDA and EBIT of HK$22,341 million (€2,668 million) and HK$2,265 million (€307 million), excluding the impact of the one-off net gain of HK$7,918 million recognized in 2022, were 31% lower respectively and 8% compared to the previous year in reported currency, mainly due to a lower contribution from 3 Group Europe. On a reported basis, EBITDA and EBIT were 31% and 82% lower, respectively, compared to the prior year in reported currency.
3 Group Europe
As of December 31, 2023, the active customer base of 3 Group Europe amounted to 40.2 million customers, 1% more than the previous year mainly due to the increase in contractual customer segments. Overall customer growth was partially offset by reduction of Wind Tre’s customer base, which strategically targets a higher average customer lifetime value for its base overall. All other operations reported a higher or stable customer base compared to the previous year.
Although Italy’s wholesale turnover continued to decline year-on-year by approximately HK$1.4 billion, 3 Group Europe’s total revenue of HK$80,231 million was 1% higher than the previous year in local currency, primarily driven by healthy customer service net revenue growth from the larger customer base and favorable revenue initiatives spread throughout the year, coupled with higher roaming revenues from increased European customer travel. As a result of an improved revenue mix, 3 Group Europe reported an overall total margin of 3% higher in local currency.
WINDTRE
The situation of CK Hutchison and its WINDTRE division in Italy reflects a challenging operational landscape, but also with positive signs. Despite economic difficulties and restrictions, the Group has continued to actively pursue opportunities for growth and performance improvement, with an ongoing commitment to address market challenges. In particular, the positive trend in 3 Group Europe’s turnover, despite the difficulties in the Italian market, highlights a resilience and commitment to adapt to changing economic and market conditions.
Despite the challenges and uncertainties, the Group remains determined to pursue its strategy of creating value and investing in future technologies, such as the transition to 5G and the use of renewable energy, in order to maintain its leading position. leader in the telecommunications sector and contribute to economic growth and progress in Italy and around the world.