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China Netcom Group (Hong Kong)
(SEHK: 906)
Hong Kong
Even if it's the smallest amongst China's four telecom companies, China Netcom is hardly the puny guy who gets pushed around. Last year, its revenues grew 34%, to $10.8 billion, powered by its 115 million fixed-line subscribers, the 27 million users of its wireless phone service known as Little Smart (a PHS or personal handy system wireless service), and its 11.5 million broadband users. Meanwhile, it has been the most aggressive of China's operators in tapping markets overseas. In early 2005 it spent $1 billion for a 20% stake in Hong Kong's PCCW. Spain's Telefonica bought a 9.9% stake in Netcom last November.
But it hasn't been all easy sailing. In May, China Netcom's popular longtime Chief Executive Officer Edward Tian resigned citing "personal reasons." And on June 5, China Netcom announced it was selling its unprofitable undersea cable company Asia Netcom for $169 million. That is seen as a step back from its aggressive move abroad—launched when it bought the company in 2003—but which will now allow it to focus more on the mainland. That should position it well as it continues to push into the high-speed Internet and interactive television or IPTV business, and as it vies for the eagerly awaited new 3G mobile licenses.
Company Info |
|
| 2005 Rank | Not Ranked |
| Sales* ($ Millions) | 10,868.8 |
| Sales Growth (over prev. year) |
34 % |
| Profits* ($ Millions) | 1,730.4 |
| Return on Equity | 22.0 % |
| Total Return on Sales (12-mo.) | 21.0 |
| Share Price As of 5/31/06 | 1.53 |
| CURRENT MARKET INFO | SEHK: 906 |
| No. of Employees | |
| Industry | Telecommunications |
| COMPANY WEB SITE > | |
*Trailing 12 months
Stock price data as of 5/31/06
DATA: Standard & Poor's Compustat
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Company Snapshot
China Netcom Group Corporation (Hong Kong) Limited provides fixed-line telephone services, broadband and other Internet-related services, and business and data communications services in the Asia-Pacific region. Its fixed-line telecommunications services include local telephone, domestic long-distance, international long-distance, value-added, and interconnection services. As of Dec. 31, 2005, the company had approximately 114.7 million fixed-line customers. China Netcom's broadband and other Internet-related services include digital subscriber line, ethernet technology-based local-area network, dial-up and dedicated Internet access, and dial-up Internet access services. Its business and data communications services include digital data network, frame relay, asynchronous transfer mode, Internet Protocol-based virtual private network, and leased line services. The company offers its services to small and midsize enterprises, multinational business customers, Internet service providers, and telecommunications carriers. China Netcom markets its services through service representatives and account managers, sales outlets, telephone marketing, and online marketing. China Netcom has a strategic alliance agreement with Telefonica Internacional. The company was founded in October, 1999, as Target Strong and changed its name to China Netcom (Hong Kong) in December, 1999. Further, it changed its name to China Netcom Corporation (Hong Kong) Limited in 2000 and to China Netcom Group Corporation (Hong Kong) in 2004. China Netcom is based in Beijing. China Netcom Group Corporation (Hong Kong) is a subsidiary of China Network Communications Group.
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