Far EasTone expects data usage to boost Q2 income

Far EasTone Telecommunications Co (遠傳電信), the nation's second-biggest mobile phone service operator, projected that its second-quarter pre-tax income would jump 5.7 percent from the previous quarter on rising data usage, the company said in a statement released yesterday.

Income before tax is expected to amount to NT$4.16 billion (US$129.9 million) this quarter, up from NT$3.94 billion in the previous quarter, the operator said after the board approved the forecast yesterday.

Service revenues, however, would grow at a slower pace by 1.3 percent to NT$15.6 billion from NT$15.4 billion, according to the statement.

Capital expenditures for this year would be around NT$7 billion -- NT$8 billion, making up about 10 to 12 percent of the company's annual service revenues, Far EasTone president Jan Nilsson told reporters after the annual general shareholder meeting.

Shareholders yesterday also elected a new nine-member board, with Douglas Hsu (徐旭東) continuing to serve as chairman of Far EasTone.

The shareholder meeting was the first since the merger between Far EasTone and KG Telecommunications Co (和信電訊), owned by Taiwan Cement Corp (台泥), took effect in March 2004.

Leslie Koo (辜成允) and Nelson Chang (張安平), who represented KG Telecom on the board, backed out of the new board after Taiwan Cement decided to reduce its holding in Far EasTone to 1.7 percent from about 5 percent at present.

Shareholders also approved the proposal to deliver a cash dividend of NT$3.1 per share, which represents over 80 percent of the NT$3.8 earnings per share declared last year. Far EasTone posted NT$14.72 billion in net income for last year on revenue of NT$71.91 billion. The NT$3.1 cash dividend also represents a yield of about 7.53 percent, compared with the company's closing price of NT$41.15 on the Taiwan Stock Exchange yesterday.