Hkbn Stock

Good afternoon, everyone. On behalf of HKBN Limited, thank you all for joining the group's 2026 Second Interim Results Presentation. First of all, allow me to introduce the management team attending today. Board Chairman and Executive Director, Ms. Shi Xiaoping; executive Director and Group Chief Executive Officer, Mr. Li Xin; Executive Director and Chief Financial Officer, Mr. Shen Qingyi; President and Group Chief Operating Officer, Dr. Denis Yip.

Now may I invite Executive Director and Group CEO, Mr. Li Xin, to walk us through the group's overall performance. Mr. Li, please.

Thank you. Investors friends, media friends, good afternoon. Welcome to HKBN's FY '26 Second Interim Results Announcement. As said just now, we have management in attendance. And because of all of your trust, HKBN employees' hard effort, and support of all working partners, with all these, HKBN in FY 2026 second interim report period from September 2025 to August 2026, our revenue was up 6.8% (sic) [ 6.2% ] at HKD 1,182 billion (sic) [ HKD 11.82 billion ]. So excluding the discretionary bonus for employees, EBITDA was up 4.1%. Net profit was up 5.3% (sic) [ 53% ] at HKD 317 million.

So in order to enhance our continuous profitability and seize opportunities in AI, this year, our CapEx investment was up 35% -- 35.6% at HKD 690 million. So all money invested is reflected by stable and continuous return. And our OpEx was down 1.5% at HKD 3,077 million and deleveraging was down from 4.66x to 4.41x (sic) [ 4.44x ]. In view of change in the financial year-end date in the current year, the group has published 2 interim reports and annual report in the current fiscal year. The company distributed the first interim dividend in April and has resolved not to declare a second interim dividend for the 12-month period ended 31st August 2026.

After the current financial year closing, we'll continue to adhere to our dividend policy, distributing dividends in an amount of no less than 75% of adjusted free cash. Through AI empowering traditional communication network, we can release computing power. With computing power, we can promote AI development, so that we can achieve full stack innovation. For this logic, HKBN this year increased CapEx by 35% with focus on upgrading network and AI computing interconnect infrastructure to build capacity for the future. We strengthened our network leadership, and upgraded MetroNet from 100G to 400G, achieving full coverage of data centers across Hong Kong, establishing 11 self-operating AI data center nodes.

We upgraded our network efficiency and stability for our core network. It can support AI, supercomputing, cloud computing, real-time trading and medical imaging. Besides, we expanded high-value enterprise and AI customer markets to drive our revenue and profits. HKBN seized AI opportunities, and we invested HKD 100 million to develop the HKBN AI+ platform. We are the first telecom service provider in Hong Kong to offer a comprehensive enterprise-grade AI service platform. We self-built the metro fiber backbone network, and we have proprietary GPU computing power, and we develop for our customers ready-to-use and tailor-made AI solutions.

HKBN continued to invest in high-speed network, and we deliver fiber to the home and bring AI into everyday life. Network coverage rose year after year, and there are now 2.69 million homes passed with an increase of 48,000 year-on-year, and we covered 8,320 commercial buildings. And we cover all Grade A and B or above premises up to 100%. We target for full fiber coverage across network to elevate digital customer experience for the AI era. For residential and enterprise broadband, our fiber coverage is 98%, which is industry-leading benchmark. 2G and above broadband subscriptions increased fast for residential solutions, about 133,000, up 40% year-on-year. For Enterprise Solutions, about 26,000, up 106% year-on-year.

We upgraded network service and optimized local and overseas connectivity and expanded Chinese Mainland direct-connect bandwidth. So there is stable growth in access to local and overseas applications with accelerating demand for Chinese Mainland applications. In Hong Kong, so actually, we are seeing some pain points in cross-border latency and stability. So HKBN implemented 2 major upgrades to its cross-border network services, enhancing quality and optimizing user experience. We increased resources to expand the bandwidth for local and overseas.

For Mainland connectivity, we work with China Mobile. We expanded Chinese Mainland direct-connect bandwidth, guiding platform traffic to local distribution in Hong Kong and driving overall traffic growth. Traffic to individual platforms increased by 275%. We're able to save costs and improve quality. So we are connected to 8 different major Mainland cities to Hong Kong. Comparing with other carriers, we have improved quality, and we are 55% better than our competitors. We improved average game latency by 59%. So we are the best fixed network service provider.

We strengthened collaboration with China Mobile and integrated resource teams to unlock growth momentum. For market synergy, we focus on broadband resale and mobile service resale. The 2 parties have stronger customer resources. HKBN have 928,000 broadband customers. China Mobile has 6 million mobile customers. So we can enhance customer reach. We accelerated business expansion. And then we also have a number of different optimizations. HKBN successfully provided mobile base station backhaul line leasing for China Mobile and also AI data center leasing service with the support of Chinese Mobile growth -- there is growth in return to Chinese Mainland network bandwidth.

For solutions, we focus on MVNO diversified packages and also security solutions, China Mobile cloud products and so on. We have 4 major strengths. We have platform strength, team strength, ecosystem strength and also resources strength. With the synergy with China Mobile, we are able to develop the market with better synergy capabilities.

Now I'm going to talk about our Enterprise Solutions performance. Enterprise business rose steadily. For the whole year, Enterprise services revenue was up 13% at HKD 6.234 billion, and there are 101,000 enterprise customers, 109,000 broadband subscriptions. SME customers, 85,000. SME enterprise ARPU up 4% this year. For large enterprise system integration, new project wins with total contract value was up 85% year-on-year. Annual revenue was up 19% year-on-year. Overseas business growth was achieved. Going global communication services revenue was up 29% year-on-year. This reflects our strong cross-border connectivity capabilities. In Chinese Mainland and Macao technology business revenue was up 12.8%, reaching HKD 1.2 billion.

So this is the end-to-end enterprise AI platform. This is first in Hong Kong, powering a complete ecosystem. For network infrastructure, we used our enterprise solutions to develop the infrastructure. So we offer sharing GPO resources. And on that foundation, we use advanced Kimi, DeepSeek, Qwen, MiniMax and other intelligent LLM back end, and we're able to achieve automatic allocation by task. In face of business, for different types of customers, we offer different solutions. For SMEs, there is the HKBN WorkMate. And then there are 100-plus prebuilt AI agents and skills, including finance, marketing, legal, HR and sales operations. For large enterprises, we offer tailor-made services. AI is integrated into existing enterprise applications, and there are fully flexible systems with usage-based billing.

For AI platform, so the work model is being reshaped, and there is intelligent process automation. There are 3 major characteristics of our platform: proprietary GPU compute infrastructure, providing AI computing power. So there are top-tier GPUs introducing Chinese Mainland's advanced computing resources and local computing power, computing facilities hosted in Hong Kong data centers, secure and compliant, meeting data privacy and compliance requirements.

Second, flexible service model, tailored AI services for enterprises. Dual service model, flexible billing via token as a service and agent as a Service. SME solutions, HKBN WorkMate, ready out of the box. For large enterprise solutions, we offer system and data integration to build customers' AI foundations.

Third, strategic partner ecosystem, AI ecosystem collaboration. For strategic alliances, we collaborate with computing and cloud partners to build a smart ecosystem. And then we also have built cybersecurity and data security mechanisms so that enterprises can achieve their own AI transformation. Since August, in less than 3 months' time, we have reached 1,960 users. Revenue exceeded HKD 20 million.

And for large enterprises, we empower company's transformation and for commercial customers, we enhance the experience. So we enhance the service process, and we automatically generate orders, and there will be integrated operating interface. For government departments, we improve frontline efficiency, and we offer cross-segment data integration. We help enterprises to connect to enterprise and partner platforms. We strengthened operational coordination, AI-assisted decision-making and resource deployment. For charitable organizations, we accelerated case management with automatic speech to text transcription and record generation.

We enhanced service quality. There is intelligent summarization of key information, and we strengthen service outcomes with AI case analysis and trend tracking. AI opportunities from large enterprise customers, HKD 600 million already. For SMEs, we offer one-stop solutions to enhance customer value. So we focus on customer needs, and we continue to expand diversified services to drive steady growth in ARPU.

Here, you can see that since FY '23, HKBN at that time only offered one line connection. And then later on, IT Simplified. And then this year, we offer HKBN AI+. So there are 100-plus prebuilt AI agents and skills and then revenue is in excess of HKD 1,000 plus.

HKBN iTEA builds an AI+ ecosystem together. It is established in 2025. It brings 25 leading technology solution providers together, including 14 exclusive distribution partners. For network, we offer highly reliable and low latency connection. And we also offer GPU and edge computing. And then for security, there is end-to-end defense from network and data to application layers, system integration. We provide industry application development and integration, and we translate technology and delivery capabilities into business value. For data, we offer high-quality data governance, integration, analytics and backup. For cloud service, we flexibly manage the hybrid multi-cloud architectures across public and private clouds. So iTEA has secured contracts valued at HKD130 million, a 3x year-on-year growth.

Chinese Mainland and Macao presence. We cultivated regional markets driving customer growth. In Chinese Mainland, our focuses are Beijing, Shanghai, Hangzhou, Guangzhou and Shenzhen. We seize opportunities from enterprises expanding northward and overseas to acquire high-value customers. For Macao market, we focus on gaming, government, banking and utilities. These are high-value customer segments for expansion. We also strengthened presence in Macao to consolidate regional leadership and enhance market influence. On this foundation, we dig deep into Chinese Mainland enterprises going global, and we seized the wave of expansion to unlock new growth in cross-border business. And this year, Chinese Mainland and Macao Technology business revenue was up 12.8% at HKD 1.2 billion.

This year, our international connectivity data revenue was HKD 316 million, up 29% year-on-year. We cover more than 20 countries and regions, supporting enterprise cross-border and AI application deployments. Under the global AI wave, it drives cross-regional data traffic surge, pushing enterprise demands for international connectivity. With high scale -- hyperscale cloud service providers this year, total contract value reached HKD 63 million, up 202%. Our working partners cover e-commerce and tech companies, manufacturers and factories, mobile gaming and game publishing, financial information platforms, import and export trading and fintech.

For Residential Solutions, revenue increased steadily. So overall residential revenue was up 1.2% year-on-year at HKD 2.418 billion, residential ARPH HKD 218 and total homes passed 2.69 million, up 1.8% year-on-year. Broadband subscriptions totaled 928,000, up 2.2% year-on-year. Customer loyalty improved 14%.

Each carrier has some parts covered by copper wires. And this year, our goal is to make sure that in each housing development, there will be fiber coverage. So with Fiber In, Copper Out, it delivers results. Revenue was on an upward trend and there is higher customer revenue. 1G or above penetration rates were at 80%. This is leading the market. And this year, for 100M copper customers, there are 35,000 being upgraded to 1G fiber broadband, and this is up 123%. And fiber broadband customers generate higher revenue than copper broadband customers, 31%.

And then infinite-play customers subscribing to 4+ services, there's an increase to 33%, 33% of fiber broadband customers versus 23% of copper broadband customers. Strong growth in 2G or above, GigaFast broadband adoption. This year, there are 133,000 GigaFast broadband subscriptions, up 40% year-on-year. This is market-leading. For strong GigaFast broadband adoption, around 40%, that means there are 2 out of every 5 new customers selecting GigaFast, up 59% year-on-year. So those GigaFast customers generate 45% more in revenue. And as said just now, those subscribing to 4+ services, these are infinite-play customers. So the percentage increased from 33% to 46%.

And then we lead ultrafast era with premium priority experience. Last year, we introduced the high-speed guarantee and low latency guarantee. This year, we are going to introduce Chinese Mainland connectivity latency guarantee. So there are -- these are the world's first triple guarantee. And then we achieved FTTR fiber to the room. So we extended fiber connectivity into rooms, delivering high-speed, stable and low latency experience. For high-end customers, we introduced GigaFast priority service to make sure that there is premium priority network, priority customer service, same-day repair commitment and 5G broadband dual assurance.

For operational excellence and quality service, we upgraded customer experience and enhanced customer loyalty. So 5G broadband resilience support, ensuring uninterrupted service, intelligent diagnostics and proactive monitoring for rapid identification and follow-up on network issues, store network expansion to reach potential customers, enhanced support for safeguarding seniors through technology. Service quality improved, customer complaints down 18% year-on-year, customer satisfaction up 6 percentage points, customer loyalty up 14% year-on-year.

Infinite-play value-added services drives business growth through diverse applications. Residential broadband customers subscribing to 4+ infinite-play services, up 6% year-on-year; OTT streaming platforms, new subscriptions, up 24% year-on-year; rising popularity of Chinese Mainland content driving new subscriptions, an increase of 32,000; senior market business growth, total contract value, up 114%.

And then we deepened collaboration with China Mobile. This is a powerful alliance driving broadband growth. We leverage China Mobile's strong mobile customer base to drive residential broadband business growth. This year, new sales of HKBN residential broadband resold by CMHK, up 5.1x year-on-year. And then for 5G broadband market demand, there's an increase. We believe that this will drive further rapid growth for 5G residential broadband growth. So we are going to do cross-selling to boost residential broadband revenue growth. So that's all in my presentation. Thank you all.

[Interpreted] Thank you, Mr. Li, for the sharing. So now we will proceed to Q&A session. Those of you on site today, whether in person or joining through the webcast, feel free to ask any questions you may have. [Operator Instructions] Please welcome Chairman Shi, Mr. Li, Mr. Shen and Dr. Yip.

Let me read out questions received online. Congratulations on the satisfactory results. Management, can you elaborate the future direction of HKBN, please?

[Interpreted] Thank you very much for this question. So for HKBN, we are rooted in Hong Kong. We serve the Greater Bay Area, and we also face the international world. We are Hong Kong top-tier technology service company. So the SARG had announced the first 5-year plan. We will service Hong Kong's economy and society better so that we can serve people's livelihood in a better way. We would also like to serve Hong Kong investors and shareholders.

We would try to deliver good work in 4 areas. First, we'll solidify long-term development foundation. We will reinforce our network advantage and strength. As said in our presentation, HKBN attaches a lot of importance to our network. So for our transmission network, it is being upgraded. And then there is Fiber In, Copper Out and so that our network can better serve our customers. At the same time, we built even more resilient business model with a steady pace and innovative momentum, we will lead the company towards healthy and sustainable development.

Secondly, we will enhance customer experience. As mentioned earlier, many Hong Kong customers need to visit some Mainland websites for Mainland content. And some local Hong Kong carriers, well, the bandwidth required is very high. And so for Mainland bandwidth, we have expanded it by 53%. So our customers' experience is greatly enhanced on the Mainland. And then for Hong Kong citizens, we offer better network experience. We continue to innovate on our products and services so that with more advanced and quality service experience, we can satisfy Hong Kong's social governance and also smart transformation, family and personal communication needs.

Thirdly, for our shareholders, we will create greater value. We step up our synergy with China Mobile Hong Kong Limited, and we also complement each other. We have almost 6 million mobile customers, that is China Mobile, and HKBN has 980,000 residential broadband customers. So we will give full play to the integration of mobile plus household and also the integration between network and resources. We'll continue to innovate on our service so that we can offer faster, smarter, highly effective and also personalized service to our customers. And then we can also create more sustainable value.

Fourthly, we'll inject more innovative momentum into Hong Kong. Together with China Mobile Hong Kong, we will promote the building of Hong Kong digital infrastructure and will empower the government and enterprises in digital transformation so that Hong Kong can be developed into an international innovation center. Thank you.

Now let's take questions from the floor. The lady in red on the third row, please.

Greetings. I am [ Kaya ] from China News Agency. Just now, you said that you will tie in your work with Hong Kong's first 5-year plan. So the Northern Metropolis is one of the focuses in the 5-year plan. So what are your strategic plans in the Northern Metropolis?

Thank you for your question. Hong Kong has announced the first 5-year plan and the development of the Northern Metropolis is described in a specific chapter. So Northern Metropolis has important strategic position in Hong Kong. In the Northern Metropolis, there will be the development of new quality productivity and there will be better integration with Greater Bay Area and also our country's overall development. For HKBN, it is a very important development opportunity. HKBN attaches a lot of importance and takes active part in the development of Northern Metropolis. We deepened our integration with China Mobile Hong Kong so that the strengths of both companies can be capitalized on. And then we will continue to invest more resources.

So there are a few main points here. First, we'll increase strategic planning and deployment. We'll coordinate our plan, and then we will also continue to invest and execute. So based on the overall development rhythm of Northern Metropolis, we will make advanced investments and building in terms of network. We will build the fiber network, and we will lay pipes and cables. For new residents, there will be high-speed broadband connectivity for commercial buildings. And also the innovation park, sports park, we will offer low latency and high-speed broadband capability.

We will accelerate network upgrading. Now we cover 2.69 million residential customers and 8,320 commercial blocks. In the future, we will expedite fiber in, copper out. And then we will achieve 100% fiber coverage in the Northern Metropolis. With advanced technology quality network, we can better support smart family, smart households, smart park and also innovative technology companies' development needs.

Thirdly, we will expand our cross-border service capability. We will strengthen integration and synergy with China Mobile Hong Kong. We will capitalize on the resource strength of China Mobile Group and China Mobile Hong Kong, especially in the area of cross-border transmission, AI, compute service and so on.

Besides, in terms of government solutions and also our ultra-wide transmission strength, I think as said in the presentation, our AI+ platform is also well developed. So for large, small and medium enterprises, we offer one-stop solutions. We will continue to be rooted in Hong Kong and serve Hong Kong. Network will be our major foundation and will empower development with technology and innovation will also empower people's livelihood. We will contribute our greater effort to the North Metropolis development as well as Hong Kong's transformation.

Thank you. Next question, please. The gentleman over there.

I am from Citi. My name is Li Yiming. Congratulations on the very good results. My question is, after the integration with China Mobile in terms of financing costs and debt optimization, what are the effectiveness so far? And what are your plans? And then in the future, regarding CapEx and financial return and dividend policy, is there any new progress or update?

Mr. Shen and Mr. Li will take these questions, please.

Thank you for your questions. First of all, you talked about the integration with China Mobile. And after that, you asked questions about financing costs and debt. So after the integration with China Mobile, we rely on China Mobile's credit value, and we did a replacement of syndicated loans. And this year, if you look at financing costs, there is a decline by HKD 250 million. Overall financing cost has declined significantly. So as a result, this is a major contribution to our net profit.

And then regarding dividend, you also covered this in your question and our Chairman also made some explanation this time, we have made some adjustments in dividend. What are the reasons behind that? Our main consideration is -- in fact, there are 3 points that we have considered. This year, we have changed the accounting day of our financial year. There are 2 interim reports and 1 final report. So in April, that's the first time of our interim report, and we paid dividend. And after the end of the financial year, during annual results announcement, we will pay the second dividend. So for the whole year, our guidance will not be lower than 75%, and there will be 2 dividend payouts every year.

In terms of financing investments and also our subsequent investments, there are also some considerations about dividend. We have to consider our investment needs. Network quality is the lifeline of telecom industry. So we have our metro net and also an upgrade from 100G to 400G and our AIDC data nodes, where we have to satisfy enterprise grade, high throughput and low latency needs and for residential business, there is the fiber in, copper out development so that users can enjoy better network quality and the stickiness will be enhanced and ARPU will increase. So we offer one-stop AI solutions. These investments have bond results, our revenue was up 6.2%.

So we need to appropriately make investment arrangements. Such investments have to be precise. While we want to enhance profitability and sustain our long-term development, our bank's revolving credit facility has increased HKD 200 million. So we do have funding guarantee.

Let me share with you some numbers. Our net profit margin in 2024, less than 1%. In FY 2025, net asset yield, 9%. This time, in 2026 second interim results, our net asset yield reached 15%. So this yield is rising steadily. So we will make appropriate consideration about dividend and fundraising. We want to enhance profitability so that we can achieve long-term development. That's my answer to your question.

So your next question is about CapEx. Thank you for your question. Regarding CapEx, let me share some numbers. For 3 consecutive years, HKBN's CapEx has risen. In 2024, before the integration with China Mobile, HKBN's CapEx was not more than HKD 300 million. And then this year, up 35.6% at HKD 692 million, so an increase for 2 consecutive years. Some is because of business needs and some is that we have to repay some loans. So that's the arrangement.

Secondly, right now, for directions of CapEx, actually, you can see that in traditional communication network, we must make investment into our network because that is the greater source of our profit. So we have upgraded from copper to fiber after that for -- there is an increase of 30% per user from ordinary fiber to 2G GigaFast, our revenue was increased to 45%. And then with technology advancing and bandwidth increasing, our user revenue is rising. Our investment has brought healthy revenue. That's one thing.

Secondly, our fiber network investment increased. At the same time, our backbone network also needs to upgrade from 100G to 400G. So this is to support our increased customers because of increased bandwidth. Secondly, there are more and more inter connection needs between data centers. So without the earlier investment, we won't be able to pick up such business.

Thirdly, we have to seize the AI development wave. HKBN this year on the AI platform invested more than HKD 100 million. So in only 2 months' time, our customers reached 1,690 (sic) [ 1,960 ]. This year, revenue is HKD 20 million. And next year, revenue will even be bigger. So we want to seize this AI wave to monetize on our AI investment so that our revenue, cash and profits can all grow.

Next question is an online question. Let me read out the question. For HKBN AI+ comparing with other AI platforms in the market, what are the differences? Thank you.

For HKBN AI+, we are the first telecom service provider that can achieve a 6-layer AI model. So from network structure and also our self-purchased GPU to our deploy -- scheduling deployment platform. And then there are 100-plus AI -- and then on a monthly subscription basis, we sell to SMEs and then we sell token as a service. This is unique in Hong Kong. At the same time, it is totally placed in Hong Kong. Many Hong Kong enterprise customers said that, oh, if your models are not in Hong Kong, but in Southeast Asia or on the Mainland, they will have worried about overall data operation. So during our presentation, you saw our 6-layer AI+ network. So we are the first company who is able to achieve this.

Now in the market, regarding resale of other AI platforms, well, there are quite many such resales. But for resale, even though they have built their own AI agents at the bottom layer, there is no way to make sure that things are in Hong Kong. Secondly, you cannot guarantee security, reliability and stability. So we are very proud of this. And today, we have already signed 1,900 orders already. This is our AI+ platform.

Thank you, Dr. Yip for the answer. Because of time, we will now take the last 2 questions. Two questions now. This media friend, please.

I am [ Mingrui ] from China Daily. My question is also about AI. So this year, regarding AI, you increased CapEx by 35%. So with the development of Northern Metropolis, are you going to expand some local data centers? And in the future, regarding investment return, do you have any expectation, please?

Thank you for your question. At present, when we are working on AI service, regarding expanding and building data centers and leasing of data centers, these are commercial decisions. We serve large customers and SMEs and also household customers. So we will think of the packages that we offer to them and also the revenue and also cost. So if we invest to build data centers, if the IRR and payback can satisfy our requirements, then we will invest. No matter what, next year, for the AI Platform 1.0, next year, the capacity will reach the peak.

And now we are going to expand the AI Platform 2.0 so that we can offer AI service to more users. So these include large enterprises and residential users. We have 928,000 residential customers and 10-odd million (sic) [ 100,000-odd ] of large enterprise customers. So whether or not data centers are leased or purchased, I think we can discuss this with an open mind. We do not make any undertaking or judgment here at this time.

Thank you, Mr. Li. We'll offer the last chance to the lady invite on the third row, please.

I'm from CICC. Just now, you said that in the enterprise market, there are different innovative businesses. And in the AI area, you have platform strength and also international strength. So HKBN is a Hong Kong-China telecom carrier. So what is your industrial positioning? And what is your unique competitive advantage in the AI chain?

As you can see from our presentation, there are 3 things in our strategy that are basically connected to each other. First, our network. If you look at our network coverage, there are different numbers from 80% to 98%. So you can see that in our results announcement. Secondly, our overall AI development. Just now, we talked about AI+. But for AI, we have large enterprises, private hosting and SMEs, they may not invest a lot, but they hope to develop in Hong Kong. And there are also different solutions with new AI content, our iTEA solution, for example, so AI+ network plus compute power. So we have all these.

Today, we have our own computing power, our own AI solutions. AI -- so GigaFast increased 100% with enterprises and up 40% with residential households. Today, you read a lot of news about AI, asking whether we can work more efficiently and so on. So regarding AI, from AI to our computing power platform, and then our network can be upgraded even faster.

Okay. Thank you, Dr. Yip. Thank you very much, media friends and investors for all your questions. Thank you very much for your attention, interest and support for HKBN. We will conclude here. Thank you for your support for HKBN, and see you next time.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]

Good afternoon, everyone. On behalf of HKBN Limited, thank you all for joining the group's 2026 Interim Results Investor Presentation. First of all, allow me to introduce the management team attending today. Board Chairman and Executive Director, Mr. Ling Hao. Executive Director and Group Chief Executive Officer, Mr. Li Xin; Executive Director and Chief Financial Officer, Mr. Lei Liqun; President and Group Chief Operating Officer, Dr. Dennis Yip. Now may I invite Executive Director and Group CEO, Mr. Li Xin, to walk us through the group's overall performance. Mr. Li, please.

Good afternoon, ladies and gentlemen. Welcome, investors, to Hong Kong Broadband 2026 Interim Results Announcement. Hong Kong Broadband has been upholding 3 growth strategies to shape the future and reshape the industry. So we are in Hong Kong, and we have unique advantages. We are creating digital service independent battle to drive the digital development of GBA. So we are working steadily on to the international stage.

We have strengthened our network capability. We have even more adequate investment resources, and we are more aggressive in expanding our blueprint. We are upgrading our services. We are working on copper to fiber transformation, and we are deepening our intelligentization and digitization, we are incorporating AI into different scenarios.

Since September last year, Hong Kong BN and China Mobile are creating bigger customer value in 5 major co-creations. In terms of customer synergy, we are integrating our customer bases to expand our footprint. And for business synergy, we are deepening fixed and mobile integration to enrich our product portfolio. In terms of synergy of services, we are offering cross-border telecom and also cloud network integration. We incorporated our computing network and also our fiber capabilities, and we are making use of our economies of scale to lower our operating cost. In first half 2026, we saw that revenue was up 5.1% year-on-year at HKD 6.029 billion. EBITDA, up 14.2%. Net profit was up 108 million, up 20%. For other operating expenses, down 2.8% at HKD 1.499 billion, deleveraging from 4.79x down to 4.58x. So EPS or dividend per share, HKD 0.155.

Network all along has been our way to service our customers and for creating customer shareholder value. So network upgrading and quality enhancing has been important for us. We're expanding our network. We are upgrading fiber equipment to enhance customer experience. We increased annual CapEx so as to cover up more buildings. This year, for a number of customers covered, it's up 2% at 2.66 million. At the same time, we upgraded our fiber to offer very high-speed network. So many customers have been encouraged to upgrade to GigaFast so that we can introduce and promote our extension services. So we are introducing our copper to fiber transformation so as to enhance customer experience.

And then for our core network, we have the 100G 10x upgrading. So this is for AI, cloud, supercomputing and also a huge amount of use of data. So among successful cases in different regions, many customers are integrated into the 100G network, and then they are integrated into global Internet. So there is now lower latency. Overall reliability and stability is enhanced. So for innovative customers in GBA as well as fintech customers in Singapore and also cloud ecology customers in Japan. Through private lines, they are integrated into our 100G network so that they can be linked to multiple platforms and data center. So we are improving our core capabilities, when there is huge amount of data demand.

At the same time, we are strengthening the cross-border network hub status in Asia Pacific so that we can have a very mega bandwidth so that there is high computing power applications. And then for upgrading our quality, we are synergizing and bettering user experience. So we strengthen network quality monitoring system. We adopt China Mobile Group's broadband quality standards. We build end-to-end observable model, and we establish a perceptible and visualizable network quality system. We optimized content distribution and deployment, improved localized content distribution efficiency, enrich CDN/OTT resources, reduce application latency and jitter.

For enhancing end user experience, we leverage China Mobile Group's extensive resources and industry chain advantages, improve connectivity quality between Hong Kong and the GBA and optimize Chinese Mainland gaming experience. You can see that we have already seen results. And we localized traffic scheduling accuracy. It's increased by 36%. Localized traffic volume increased by 30% for use on Douyin and Red Nook, so the latency was reduced from 32 milliseconds to 5 ms, 65% reduction in latency for mainstream Chinese Mainland games.

We have already enhanced the speed and traffic performance of Chinese Mainland network access. We're faster and more reliable, empowering enterprises to connect efficiently to the Mainland network. So Northern Metropolis network strategy, it is our forward-looking vision for the future, and it accounts for -- Northern Metropolis accounts for 1/3 of Hong Kong's land area in future population. It is a new engine for Hong Kong strategic development, substantial economic value and growth potential, creating large-scale employment and boosting productivity. With high-speed private network, so for various business areas, we offer dedicated networks. At the Northern Metropolis, we will cover network covering up to 350,000 residential households.

Now let me talk about the performance of our enterprise solutions. Revenue was up 10.5% at HKD 2.817 billion. SI revenue, up 11.1% at RMB 433 million, 2 Gbps and above GigaFast broadband customers over 18,000, up 2.1x year-on-year. Average monthly churn rate came down to 1.1% from 1.3% last year. Building coverage was up 1% at 8,266 buildings. For our Enterprise Solutions, the base is GigaFast. And through 3 directions, we are increasing our growth.

So first of all, solution upgrades. So we are enhancing our upgrade. So Chinese governments and also overseas enterprise markets are our focus. Besides, together with our partners, we have co-created Cytek ecosystem. So this can drive our overall business development, including cybersecurity, AI, cloud, IT infrastructure and digitalized application. So all these have been our integrated solutions. GigaFast business broadband through 1 year's time, we have increased 2.1x in terms of customers number. And then 70% is the router bundling rate. And then there are 18,000 GigaFast customers. For SMEs, we have value-added services for diverse business needs. In the past, we work for retail, F&B, general business, property management sectors. This year, we have newly introduced smart education solutions. So it is a one-stop solution covering AI teaching, computer equipment, AI software, smart mailbox and AI CCTV.

Besides, we have got this NPontZafe endpoint solution, security. In first half 2026, there is average monthly fee increased by 25-plus percent. new average monthly fee, HKD 800, number of new value-added package subscribers, 7,000 plus. total new contract value, HKD 150 million, up 11% year-on-year. And then for large and medium enterprises in the first half, project value exceeded HKD 95 million, up 17% year-on-year. We delivered more than 350 projects. So we converged telecom and tech enterprise expertise, meeting complex digital needs of large and medium enterprises across industries.

We offer unified multi-cloud management and connectivity, customized multi-branch private network, critical infrastructure, [ NT DDoS ] services, securities and derivatives, market connectivity and professional applications. We successfully served multinational corporations, major Hong Kong enterprises, financial regulators, governments and Qusai government bodies, retail chains and other customers. We deliver comprehensive, scalable connectivity solutions.

For system integration business, our performance is outstanding. We power enterprise digital transformation. In the first half, revenue was up 11% year-on-year at HKD 433 million. Gross profit was up 16% at HKD 83 million. So it is a core technology partner, leading enterprise digital transformation. We are Hong Kong's leading cloud and managed services operator. Revenue was up 16%. And then we are also an IT operations and security management expert. We have brought in exclusive authorization from vendors, enhanced data security and system upgrade maintenance capabilities. We are also a trusted AI application partner. We build end-to-end reliable AI environments to deliver tailored solutions for enterprises.

Hong Kong Broadband ITEA builds an I&T ecosystem. We collaborate for shared success. We launched in 2025, referring to this alliance, and it brings together leading technology solution providers across sectors. In first half 2026, we have newly signed agreement with H3C, Yunke China, Yonyou, Integrity Tech, Lark and so on, so as to give us better development and business opportunities.

There are signing with exclusive partners to enhance our profit margin. For growing computing power, we drive AI services towards stable recurring revenue. computing services growth, 13-plus percent year-on-year, intelligent services growth, 30-plus percent year-on-year. When we face different smart organizations, we offer different services. For government departments, we provide intelligent solutions to strengthen unified management of public assets. For trading platforms, we establish sustainable intelligent operating systems to support long-term stability of critical systems. For social service organizations, we construct end-to-end enterprise intelligence systems covering budgeting, financial data flows and user processes.

So there is clear enterprise demand for AI fueling future computing power developments. We build high-power computing portals. We expand computing power capacity to meet AI and high-performance computing demand. We adopt a dual-track approach of in-house development and resale, balancing long-term control with near-term scaling. Computing-powered smart business models, deeply embedding computing power and AI agents into enterprise system integration and delivery, integrating proprietary AI agents as a core capability into platform delivery. Deep integration with China Mobile's product ecosystem.

We expand application scenarios through smart operations and deep platform integration, covering IoV, low-altitude economy, IoT platform, JiuTian AI platform, mobile cloud and more. End-to-end AI solutions is tailored for industry scenarios powering customer digital transformation. We have strong capabilities, deep industry experience and proven customer cases. We help businesses across sectors achieve AI-driven digital transformation. For government agencies and logistic companies, we have built knowledge-based AI agent for unified asset management, intelligent workflow queries and for insurance banks and other operators, we built omnichannel contact AI agents.

And then for trading platforms, logistics companies, entertainment, we have built data intelligence core for data integration and analytics and embed AI into workflows. We are the first to launch open cloud AI solution as a telco. We're guided by philosophy education first application for all. We offer professional installation services, practical skills training and enterprise-grade network protection. The first workshop was successfully held on 23rd March 2026. More sessions will be launched with overwhelming response.

For international data business, we can see year-on-year growth, reflecting strong cross-border demand. In first half, revenue increased to RMB 143 million, up 20% year-on-year with strong customer relations, local network advantage and deep collaboration with overseas carriers, our fixed network business offers customized connectivity solutions to meet diverse needs of various industries. So we offer high bandwidth service and also private line and international private network.

So we focus on innovation and technology development on R&D and also on quantum secure private line, we redefine data transmission security. Quantum secure transmission can eliminate e-stropping and prevent decryption. There are 3 advantages: ultimate security, ultra-low latency and bandwidth on demand. Application scenarios include finance, health care, aviation, enterprise compute network and energy.

Next, our Residential Solutions. Residential telecom revenue was up 3.8% year-on-year at HKD 1.241 billion. Residential ARPH, up 2.8% year-on-year at HKD 218. 2G and above GigaFast broadband subscriptions year-on-year increased 42.7% at 114,000 broadband subscriptions, up 1.8% year-on-year at 960,000. Total homes passed 2.66 million, up 1.7% year-on-year.

For our Residential Solutions, GigaFast is our core, and there are 3 major directions to drive growth. So for fixed mobile convergence, there is one-stop service. And then Infinite Play, we bundle value-added services to enhance customer loyalty and renewal rates. network upgrade, we accelerate fiber network coverage, driving fiber in, copper out, elevating user experience. So we can satisfy customer different needs, including OTT content expansion and home infinity service. There are also health care services and solutions.

So far, our residential 2G and above, annual growth is 43% year-on-year at 114,000. At the same time, 80% of our customers are bundled with our routers. 10% of our customers are using higher grade 5G or 10G service. And then there is even smarter and more convenient life style convenience. So there is voice, global SIM OTT service, broadband, WiFi, security, insurance and health care. So altogether, there are 11 different types of services to satisfy customers' needs.

Those using 4 and above Infinite Play solution, there are already more than 27% of such customers. So it is now at HKD218 in terms of residential ARPH. Through Infinite Play package, we cover esport, OTT, AI users and also working at home -- working from home. OTT subscription business enjoyed steady growth. So we are Hong Kong's #1 telco partner in Netflix, iQiyi, Disney+ and MyTV Gold. This year, we introduced WeTV and KKBox. ARPH's up 14% year-on-year. Paid subscriptions grew 12% year-on-year. As a result, our overall revenue was up more than 26%. And then mobile services is our core this year. At the moment, we see a lot of market opportunities from different households and also from mobile customer base.

At the same time, there is significant potential to upgrade or switch to broadband times mobile bundled services. Our market advantages are high-speed, low-latency cross-border connectivity, integrated Hong Kong, Chinese Mainland communication solutions for cross-border and high net worth customers. We will strengthen dual brand synergy. We will strengthen broadband times mobile service integration, improving renewal rates, ARPH and value-added service revenue. Comparing with last year, in 2026, average monthly fee is up 7% year-on-year. In March, we increased our marketing efforts. So telecom service residential customers increase over 100%. Gerontech Solutions, we safeguard seniors for aging in place. This is very important. Elder Buddy includes home safety, daily care and outdoor smart devices. For high-risk carers and families, we're offering Gerontech solutions. So the above is our result presentation. Thank you.

Thank you, Mr. Li, for the sharing. Now we will move on to Q&A. [Operator Instructions] We'll start with a question from the floor, then we'll take a question from the online participants. After that, we'll switch it up and go back and forth. [Operator Instructions] We welcome your questions in either Mandarin or English. May we invite the first question from the floor, please?

I am Andy. I have a question. So looking at your international business growth is quite good, up 20%. What are the reasons?

So looking at the growth of 20% for international business, there are a few reasons. First, our customers actually can see that there will be more and more going abroad and overseas development. And then companies which use Hong Kong as their international headquarters, there are more and more such companies. In the past, our customers are based in Hong Kong and then gradually, they expand to Southeast Asia, Middle East. Of course, recently, business was lower in Middle East. And for these areas, there is the need for international carrier lines.

The second angle or perspective is that right now, as I said earlier, there is more and more ecosystem alliance like ITEA. So with Mainland, Hong Kong, Chinese solution companies, where they are also looking for overseas development opportunities. When we collaborate in Hong Kong, we also work together in a lot of projects and solutions in Southeast Asia. So regarding overseas development, especially going out from Mainland, Hong Kong serves as the headquarters to drive our growth.

Thank you for the question. Thank you management for the answer. Next, we will take the next question from participants here.

Next question online is, so interest rate trend, what will be its impact on the company's finance cost?

So some time ago in the market, interest rate level was at a rather high level. And right now, it is coming down. The trend is a downward one. So at present, it is at a relatively stable stage. So recently, if you look at Hong Kong HIBOR, it is at around 2.5%. I believe on one hand, market interest rates will come down or stabilize. At the same time, in terms of financing, we are making a lot of arrangements to lower cost. So we expect that to us, finance cost will be more and more favorable. That will be the outcome.

Thank you for the questions from online investors. Once again, we'll pass the floor to online participants. So in the Mainland market, in terms of your expansion on the Mainland, what are your plans?

Actually, for Hong Kong Broadband, we basically focus on local resources. All our resources are in Hong Kong. We are talking about our network resources. At the same time, on the Mainland, we also have human resources because a large number of people are doing ISI business on the Mainland. And there are also some Mainland Chinese companies going abroad, as mentioned earlier. There are also some Mainland local businesses. These are done on the Mainland. At the same time, we work with China Mobile Group we work with the Mainland departments and our resources are being integrated to get more business opportunities.

For example, Hong Kong companies going into Mainland or Mainland companies going to overseas, going overseas via Hong Kong. These are things that we can do. So it's like a door opening on 2 sides. So as long as things go through Hong Kong, we can do it. This is going to be a big development opportunity in the future.

Thank you. Once again, questions from the floor, please. Back to online. In the interim results, CapEx was up 13% year-on-year. So what is the structure of CapEx input? So if raw materials like fiber increases in price, would that affect your CapEx plan?

Let me emphasize, CapEx growth. is within our range of control, and there are directions for the investment. It all depends on where market opportunities are. Now in the Hong Kong market, more market opportunities are related to AI and also smart services. These are important areas where we invest our CapEx. At the same time, we will have to see where customer needs are in the market. So for broadband, network access and also iterated services, they have demand. So this is another focus of our CapEx. And then our own company's development direction. So for old and broken equipment, we will invest CapEx to upgrade our equipment and technology. So these are the 3 areas.

This investor has asked another question. Regarding AI-related revenue, so how much is it? What do you think will be the drive to your business coming from computing needs of AI?

Let me answer this question. In the AI area, well, just now you might have seen from our results, SI system integration accounts for around 20% to 25% of total ES revenue. So it is difficult to say which part is AI and which is not out of this 20% to 25%. Regarding customers' demands and also network bundling, they are related to AI. So when we announce results, there is not an item specifically about AI. Regarding our moves on AI today, you can see that there are many moves in relation to AI. And just now Mr. Li also said that in relation to our CapEx, we also take into consideration some CapEx related to computing power.

So in May -- on the 7th of May, we will make a new move, and that is on AI plus network, we are going to have a new initiative. So actually, we can see that most of Hong Kong enterprises now are looking at how to make use of AI to deliver faster and better experience. So for our future positioning, it is AI plus -- network plus AI development. So please stay tuned.

Thank you. Next question from the floor, please. online question. Since September last year, after China Mobile had got into Hong Kong Broadband, well, how do you see Hong Kong Broadband's performance?

Well, Hong Kong Broadband performs quite well. I think we have a very professional and engaged team. So they're all united. We are all united together, and we are delivering more services for customers and for the market.

Next question. In the second half of the year and also in the future, regarding our cooperation with China Mobile, will there be further expansion? What is the outlook?

In Mr. Li's presentation, he mentioned that there are 5 areas of synergy. And these 5 areas of synergy will be deeper and deeper and the empowerment of Hong Kong Broadband will get stronger. Regarding customer services, content and foundation of customer services, there will be big enhancement. And then the room in the market will be broader.

Next, we'll continue with online questions. Regarding shareholder dividend policy, will there be any adjustments?

Let me take this question. In 2026 first half, we proposed to pay HKD 0.155 of dividend. So it seems to be flat as compared to same period last year, that is first half last year, but it doesn't mean that our dividend policy is going to be flat. In our results announcement, we already gave a very clear guidance. So we will try our best to create stable and sustainable return for all shareholders. That's our strategy.

And then for our external dividend guidance, under usual circumstances, we'll look at adjusted free cash flow. It will -- so based on not less than 75%, dividend will be paid out, not less than 75% of the free -- adjusted free cash flow. So of course, the Board will actively evaluate our dividend policy and dividend payout. As you know, usually, we will consider our company's results and performance and also -- just now, our management already said or talked about an increase in our CapEx.

So we will have to consider our future capital and investment needs. And at the same time, there are debts that we need to repay, and we will also consider future development needs. We will take into consideration all these factors in determining our dividend policies and dividend payout.

Thank you, management. Thank you, online investors. Now we will pass the floor back to on-site participants.

Once again, thank you, management. for the detailed answers and presentation. And thank you, investors, for the active participation. We'll conclude the Q&A session here. And also the results announcement is concluded here. Thank you very much. See you next time.

Good afternoon, everyone. On behalf of HKBN Limited, thank you all for joining the group's 2025 Annual Results Investor Presentation. [Foreign Language] First of all, allow me to introduce the management team attending today. [Foreign Language] Board Chairman and Executive Director, Mr. Ling Hao; [Foreign Language] Executive Director and Group Chief Executive Officer, Mr. Li Xin; [Foreign Language] Executive Director and Chief Financial Officer, Mr. Lei Liqun; President and Group Chief Operating Officer, Dr. Denis Yip. [Foreign Language] Mr. Li Xin?

Investors, friends, friends from the banking sector, good afternoon. I'm very happy to represent HKBN today to present the annual results. The theme this year is empowering lives, reshaping businesses, inspiring innovations. Just now, the management has been introduced to you. Now let me go through our performance.

First, for revenue this year. So HKD 11.129 billion. EBITDA, HKD 2.45 billion, up 4% year-on-year. Net profit, HKD 207 million, up 20x. Free cash flow up 9%, HKD 677 million. OpEx was down 3% at HKD 1.592 billion. And our deleveraging in 2024 was 4.93x and this year, 4.66x. So dividend per share, HKD 0.3443.

So the results that we have achieved rely on your support and also our customers' trust and encouragement. At the same time, we have to thank the effort of our employees. Besides, we have put in place the growth strategy. In 2025, our growth strategy is that there are value and infinite possibilities. And our core is our GigaFast. And source of revenue is also our main driving force for profit. We have both Enterprise Solutions and Residential Solutions. First, for Enterprise Solutions, GigaFast had driven the digitization for enterprises. At the same time, we have integrated system solutions, combining telecommunications and technological expertise, injecting core momentum into business growth. We have cybersecurity, AI cloud solutions, IT infrastructure and digitalization.

We have also established an ecosystem alliance to help enterprises to develop overseas markets. For residential, we have GigaFast, home broadband leading the entertainment business. So we are changing from ARPU to delivering integrated service to household. So with our Infinite-Play Solutions with OTT Entertainment, Home Infinity, Healthcare & Intelligent Solutions, we are able to serve diversified needs of customers. And besides, we offer unified effortless experience with seamless integration of fixed and mobile networks.

Next business highlights. For our enterprise business, we have HKD 2.688 billion of revenue for enterprise core telecom revenue, up 3%. And then next, we have HKD 770 million for Enterprise System Integration. And then we have more than 12,000 of customers for 2 gigabits -- and then for churn rate, we are down 0.2 percentage points at 1.2%, and we cover 8,220 commercial buildings and facilities, up 1% year-on-year. Our coverage is increasing, and our monthly churn rate is coming down. Our high-value users are increasing. Our overall revenue grew for our enterprise solutions. So this shows that our enterprise business has been stable.

For residential business, core telecom revenue, HKD 2.027 billion, up 2%. So here, you can see just now, we talked about residential ARPU up 2% at HKD 186. And then ARPH, HKD 217, up 5%. So for 2G and above customers 95,000, broadband subscribers 907,000. Total homes passed, up 2% at 265,000 households. So here, you can see our coverage is increasing. high-value customers are increasing. And then for revenue from smart solutions, that is also increasing. As a result, our residential business has grown.

Next, let me go into detail about our enterprise solutions, GigaFast broadband. So it is an important solution behind our rapid growth. In August 2024, it was launched. At that time, penetration was only 0.8%. In August this year, 13.1% already. For our GigaFast customers, we have more than 12,000 customers. For 5G and 10G contract value, their share is more than 20%. Besides, for different enterprises, we have provided different solutions for SMEs, where we have Biz-In-Motion and also Shop-in-a-Box all-in-one retail solutions. And then for products, we have one-stop IT service, Care+ and then [indiscernible] AegisInsight and CyberZafe as well. So for different types of customers, we offer different solutions. For retail and F&B, we offer Shop-In-a-Box, so that for customers' whole life cycle, we offer solutions.

And then we also offer electronic payment, omnichannel and also the queuing up system. And then we offer inventory management, online marketing solutions. And then for general business, we have the Biz-In-Motion, we have Microsoft and also the HR system, meeting system, e-claims and so on. So we can offer to customers whatever they need.

For property management, we offer Property-In-A-Box. So we can do Internet of Things. We offer digital operation platform, including surveillance and also booking platform. So in 2025 FY, total increase in number of customers is more than 13,500 and average monthly fee was up more than 20%.

Then for larger enterprises, we extended connectivity solutions and integrated telecom and technology expertise. We focus on cloud, customized private network and also cybersecurity to expand our revenue. So we have our DWDM ultra-low latency arrangement. So we are able to integrate the cloud and network, besides we support AI and also public cloud. And then we have dedicated cloud and network managed service with real-time connectivity monitoring. So we are able to offer integrated arrangement.

And then for customized private network, we can serve Customized Metro Ethernet. And then we offer corporate data security and comprehensive manageability. For critical infrastructure, we offer Anti-DDOS protection. And then there is Anti-DDOS Clean Pipe, 2-tier firewall protection and managed security services, offering to customers very good security.

There are more than 400-odd contracts being signed, contract value more than HKD 110 million. We cover technology, property, finance, logistics and utilities sectors. At the same time here, you can see that our SI business performs very well. Revenue this year was up 14%, gross profit up 16%. So in Hong Kong, this year, all these figures are very stellar performance. So on sports and entertainment organization, we offer next-gen critical infrastructure upgrades and management. We offer very high-quality, low-latency network. For financial institution, we provide future-proof global high-volume trading platform. Again, this is low latency and high usage network.

For outdoor event venue, we use the LiDAR technology to do crowd tracking and venue management system in order to enhance venue management efficiency. And then, of course, we want to satisfy customers' needs. So at the beginning of the year, we established the iTEA, we unlocked new partnerships and business opportunities. With leading technology solution providers, we help enterprise customers overcome technology challenges and accelerate business growth. We capitalize on our 1,000-plus service delivery engineers. That's our strength. And together with our partners, we empower enterprises with AI and innovation.

In second half 2025, total contract value exceeded HKD 50 million. And for all iTEA enterprises, we are in all industries. So we have leading database software and leading storage service and also big data operators. And then we have enterprise-based AI computing power provider, including end-to-end network management system and various service providers.

And then for cybersecurity, we work with both Hong Kong and Mainland service providers. On cloud infrastructure and backup solutions, we offer HRM and ERP. And then this year, for AF technology, we do not only work with AI software companies like Baidu Cloud of the Mainland, we also work with AI GPU provider from the Mainland. So we offer integrated solution from hardware to software.

At the same time, we focus on future technology development, and we work with Jiangsu Future Networks Innovation Institute. So we make good use of their first next-generation mega facility, and we are in more than 40 core cities. So for Hong Kong users, we offer AI computing power and also data algorithm so that we can offer possibilities for their AI development.

In this year's policy address, the CEO said that the government would advance the development of a competitive low-altitude economy ecosystem, positioning Hong Kong as an Asia Pacific hub for innovative low-altitude applications. So we work with Beijing Research Institute of Telemetry. By integrating telemetry technology with digital solutions, we aim to explore low-altitude economy applications and drive development of smart cities in the GBA.

Of course, all foundation is about our network. So we want to be able to help our customers to satisfy their customers' needs. So first of all, we have the fiber network all over Hong Kong. That's the foundation. Besides on this foundation, we have the TWM technology. So we have built the terabit-based -- terabit level technology. So we hope that we believe that DWDM together with our MetroNet, then for our enterprise customers, we are able to offer a convenient solution. So they can do AI and machine learning and also diversify synergy, IoT, video and also digital twin, 8K video and IoT and so on.

So we need to protect critical infrastructure. So protection of critical infrastructure computer systems ordinance will take place from 1st January 2025. It will take effect that day. So we will -- there will be cybersecurity management units to be established and regular conduct drills and risk assessments. So for our customers, there will be new requirements. And then we can see that Hong Kong cybersecurity market will continue to grow. In 2025, the scale is USD 850 million. By 2030, it will grow to USD 1.2 billion.

In the coming 3 years, our related revenue will also steadily rise by 3x. So here, you can see our 2025 data. In FY 2025, contract value totaled HKD 188 million, up 3.3x from 2024. We have diverse security partners. So together with Mainland working partners, we have actually achieved more than 12x in growth in new project value. So we have also more than 120-odd talents in our talent pool.

Next, Residential Solutions. So we are driving ARPU and ARPH with GigaFast Upgrades and Infinite Play bundles. Per customer, the growth is HKD 186, up 20% for each family, HKD 217 in revenue, up 5%. So you can see that our effectiveness is very fast. Our penetration rate last August was 7%. Total user number within a year grew 44%. Right now, for our GigaFast customers, there are 95,000 customers right now. And then 90% of the customers have chosen the bundle -- router bundle package. So that would be additional income for us for HKD 86.

So overall speaking, you can see that we have 90,700 total customers, 90 odd thousand are 2G plus customers. And then we have the Enhanced Infinite-Play Solutions. So that is to enhance our family income. We offer 3 tier of solutions. First, the telecom need; and second, the network need and third layer, the daily living need. So we have voice communications, high-speed fiber broadband, global SIM and so on. So for network need, we offer to them home network solutions with home, cybersecurity and WiFi. So for home entertainment and lifestyle, we offer OTT, music and entertainment, e-commerce shopping, travel and home insurance, sharing technology and health care services.

So last year, our residential income was up 5% at HKD 21.7 billion. Just now, we talked about 11 residential service products. And then those subscribing for services, it was up 10%; 5 services and above, up 3%. So this shows that our customers are more and more receptive of our solutions. And this shows the success of our Infinite Play Solution. So broadband, mobile, telecommunication, OTT, WiFi and also network security, these have promoted our revenue growth.

For OTT, our stand-alone OTT subscription is rising steadily. For global OTT working partners in Hong Kong, we have Netflix, Disney+ and myTV Gold. So these are telecom working partners, which are top sales achievers in Hong Kong. And in first quarter next year, we will introduce WeTV and KKBOX. After subscribing to OTT, our ARPU every year will be up 11%. And then OTT subscriptions last year grew 11% as well. So for subscriptions, we have a big increase in our revenue.

And then when it comes to premium customers, we introduced Home Infinity, which is bespoke home services. So we are building excellent customer experience. Based on different customer needs, we offer on-site maintenance; products include network, storage, surveillance and also smart home. And finally, we have to say that we have our ESG commitment. HKBN's inaugural syndicated sustainability-linked loan is such that interest rate adjustment mechanism is tied to sustainability performance targets.

Our target is to reduce carbon emission and average failure rate of phishing assessments for Hong Kong BN's staff should be lowered. And then we achieved The Asset Triple A Sustainable Infrastructure Awards 2025 Telecom Refinancing Deal of the Year. So we are within top 20% among telcos worldwide. And then we are also AA+ rated under Hang Seng Corporate Sustainability Index series. So we are within top 10% of Hong Kong rated companies.

I believe that we are able to -- and we are working very hard to offer even better quality services to Hong Kong society and Hong Kong customers. Thank you all.

Thank you, Mr. Li, for the sharing. So now we will set up the stage, and then we'll move on to Q&A session. [Foreign Language] We'll invite our management to the stage for the Q&A session, please.

So we have Mr. Ling, Mr. Li, Mr. Lei and Dr. Yip, please. So those of you on-site and online, you are most welcome to ask questions. We will first invite questions from those on site, and then we will read out questions that we have received online.

Here with us today, whether in person or joining through the webcast, feel free to ask any questions you have. We'll start with a question from the floor, then we'll take a question from online participants. After that, we'll switch it up and go back and forth. [Foreign Language] If you are here in person, just raise your hand and I will bring the microphone over to you. [Operator Instructions]

[Foreign Language]

First question on the phone please.

Greetings. I am Konya. First of all, congratulations on the excellent results. I have 2 questions. First, looking at the results announcement, so the theme is about growth. So can we -- can you share with us future growth highlights, for example, regarding Residential Solutions and Enterprise Solutions and regarding the parent company's support on HKBN. Where can we see such support?

My second question is about your dividend policy. So in the future, will there be any change to your dividend policy?

Let me take the first question first concerning growth in the coming year and our strategies. Actually, we focus on enterprise and residential growth. For enterprise business, if you take a look at 2025, for core business growth is already 7%. So just now, Mr. Li mentioned the total. So the growth is even bigger than that. So in relation to growth from enterprise, there are 2 things.

First, we launched new solutions like MetroNet 100G and also 2.5G Plus, 5G, 10G and so on. So these 2 within our investments are such that we have already made a lot of plans and solutions. So this is going to be an important highlight.

Next there is 14% growth and 16% growth in GP margin in SI. So when it comes to SI, in the coming 5 years in Hong Kong, there will be a big change in the past. So perhaps we use products from Europe and U.S. for SI in the coming 5 years in Hong Kong. Basically, there will be very good solutions at lower price. So they are Chinese solutions. So on this point, we have established iTEA. There are almost 30 different working partners in it already. So when it comes to growth from SI, we are highly confident.

In terms of overall, no matter whether we talk about telecom or SI, so I think our direction is very good. Of course, after China Mobile has come in, well, they have developed some products. And in the future, we will also take a look at how to make use of solutions from the headquarters of China Mobile and also China Mobile in Hong Kong, so as to accelerate our growth.

I will defer to Mr. Lei to talk about dividend.

Yes. Let me talk about dividend guidance. Thank you very much for your attention. All along, we have been striving to ensure that shareholders can share our results. So our policy is to have stable dividend. So adjusted net profit, it will be not less than 75% of that. And at appropriate times, we will review our dividend policy and dividend payout. And then the Board, we'll look at our company's profitability and operation and future capital needs, future business needs. And then at the same time, in terms of deleveraging and dividend payment, we will try to strike a balance between these 2 so that we are able to create long-term value for shareholders. Thank you.

Thank you for the detailed answer. Thank you for the questions. Next question is from online. Integrated asset management. Do you have any plan to help the company to lower financing cost?

So it seems that our liabilities are not low, but we are within a reasonable range in our industry. That's the first point. Secondly, regarding our company's development, we need reasonable capital to satisfy future investment needs. Of course, we will focus on enhancing management of our liabilities and financing costs. So after the entrance of China Mobile, there is good reputation and also various banks have confidence and recognition of Hong Kong AN. So they have given us big support. Today, we have just completed the HKD 10.75 billion refinancing arrangement. This arrangement will bring to our company a rather big savings in terms of our interest expenses. I won't give the exact number. Why? Because, well, that would affect our next year's earnings forecast.

So there are 2 factors that you need to consider. First, for financing contracts, one-off borrowing cost, it will have to be included in the next FY around HKD 140 million. For financing, it is arranged based on floating interest rates. So the final arrangement will depend on market change of the floating interest rate. That's why I won't give a definite guidance. Thank you.

Thank you management for the answer. Thank you for the online question. So next, we will take question from the floor.

The gentleman on the third row, please?

Yes, I'm from BOC Hong Kong. So after China Mobile has acquired HKBN, so 2 strong players are working together. In terms of telecom network, customer resources, R&D and so on, there are a lot of complementary basis. So in the future, how are you going to integrate the strengths of both parties in order to achieve co-sharing of resources so as to reach the goal of cost reduction and efficiency improvement?

Thank you for your question. All along, we have been looking into this matter. HKBN originally was in the process of M&A. And right now, there are 2 levels of network that need to be optimized and integrated. So basically, we have to maintain independence of each other. At the same time, we want to achieve synergy. The 2 companies will adopt market practice. So these are 2 independent legal entities working together.

And then for future network development, we believe that there would be a lot of synergy in our strategies. So we will be able to enhance quality. And for both teams, we are able to complement each other, and then we can learn together to achieve enhancement. I think if one team can come up with a good solution, then it will be shared with another team, especially about technology. As a result, there will be a good synergy effect.

Regarding concrete data, I cannot really give you some concrete numbers because both parties have to consider. At the same time, we have to go through HKBN's Board of Directors. So in the future, when we want to enhance the network, we need to see how much more money we need to invest and the market potential that can be generated and also possible cost increase. All these have to be considered to maintain value of the enterprise in approving and vetting the plan. So at this stage, the plan is not being scrutinized yet. Thank you.

Thank you for the answer. Next question is an online question. China Mobile has become your majority shareholder. After that, in the future, how will your company benefit from that?

Let me take this question. China Mobile Hong Kong has become the majority shareholder of our company. So the 2 companies will work together. We will complement each other with our strengths. We will make good use of China Mobile's and HKBN's strengths to cooperate and integrate. Now there are 3 areas of synergies. First, about market and service. We will make use of HKBN's foundation in the market and Hong Kong, China Mobile's leading ecosystem to offer complete solutions to customers. That's the first point.

Secondly, in terms of technology and resources, there will be synergy. As you all know, HKBN in terms of fiber network has strong advantages and strengths. And China Mobile Hong Kong in terms of 5G and computing power and high-tech areas also have strong strengths. So both parties can offer to customers better services and more competitive product choice.

Finally, there will be synergy in terms of strategies and also value. So we will look at markets with strong strategic value, and we will offer to Hong Kong government and Hong Kong residents products and services with better value.

Thank you for the answer. Because of time, we'll take the last question from the floor. Microphone to the investor who has put up his hand.

I am [ Jew from DBS Bank ]. My question is about the Mainland market. So we noticed that this year, HKBN is working with more and more companies and organizations on the Mainland. There is more and more integration with them. So I want to get some guidance from you in the future concerning revenue from the Mainland market. How much help will be delivered to the overall business growth and revenue growth?

I think there will be growth in a few areas. First, as we all know, going abroad, very often Mainland solution providers, when they bid on the Mainland, profit is relatively lower because it is highly competitive. So usually, they want to go abroad. And when they go abroad, they like to use Hong Kong as the international headquarters. So you can see that our SI revenue is growing. That is actually because of iTEA, we have brought in some solution providers, some are exclusive. And in Hong Kong, we can sell their products and services.

Besides, you mentioned the Mainland just now. So in our results announcement, so we have JOS, China and JOS Macau. So JOS is Jardine office system in the past. And later on, it was rebranded. So regarding JOS customers, they are mainly on the Mainland. And they can see 2 things. First, going abroad. So going overseas, for us, relatively speaking, our growth is very fast. So if you look at our data service, our overseas development is fast.

Besides, another point is related to the entrance of China Mobile Hong Kong, and that is about the layout in the GBA. So in the future, we can see that there is growth potential. So on many points, we are considering many areas. Today, we have China Mobile Hong Kong to help us. So we believe that in the future, our growth will be faster and better.

Okay. Thank you, management, for the detailed answer. Thank you, investors, for the questions. So we will conclude the Q&A session here, and our results announcement is also concluded here. Thank you for your long-term interest and support.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]