Far EasTone Telecommunications Co Ltd (遠傳電信) is looking to transform the company into a top mobile service provider, aided by its extensive investment in new 4G services, a top executive said yesterday.
“At the end of last year, we formulated a three-year strategy to steer the company toward a new direction in the data-oriented 4G era,” president Yvonne Li (李彬) told the company’s annual general meeting.
The company aims to become the nation’s No. 1 mobile commerce provider within the next three years, Li said.
New mobile services are expected to exceed NT$5 billion within three years and account for 6 percent of overall revenue, she added.
Far EasTone has also set a goal of expanding its share of the enterprise telecom service market to 20 percent in 2017 from 15 percent, she said.
Far EasTone saw its net income rise 11.63 percent year-on-year to NT$5.43 billion. As the company is expected to launch its 4G services soon, it is expected to begin amortizing the cost of its 4G network deployment this month.
In October last year, the company won the A2, C2 and C4 frequency blocks for NT$31.32 billion in the government’s 4G auction.
The company has budgeted NT$13 billion for capital spending this year, mainly to build up its 4G network. The figure is up 26 percent from NT$10.5 billion last year.
Given a mature 4G ecosystem, including a broader selection of handsets and lower equipment unit costs, operators should be able to make a profit from 4G services faster than they did with 3G services, Li said.
Shareholders yesterday gave the go-ahead to the company’s plan to distribute a record-high cash dividend of NT$3.75 per share based on last year’s net income of NT$11.85 billion, or NT$3.61 per share, plus NT$0.586 per share allocated from the company’s accumulated profits.
That translates into a dividend yield of 5.48 percent based on Far EasTone’s closing price of NT$68.40 yesterday.
Li said the company would stick to only paying cash dividends over the next three years.
Far EasTone also said it is in talks with Hon Hai Group (鴻海集團) to swap the 700 megahertz (MHz) frequency bandwidth owned by Asia Pacific Telecom (亞太電信). Hon Hai is the biggest shareholder of Asia Pacific Telecom.
The company is also close to reaching a similar deal with Taiwan Mobile Co (台灣大哥大) to swap its 1,800MHz band, enabling it to expand its 4G services to the 1,800MHz frequency in September.