Chunghwa Telecom Co., Ltd.

Good afternoon, ladies and gentlemen. Welcome to Chunghwa Telecom Conference Code for the company's second quarter 2022 operating results. During the presentation, whole lines will be on listen-only mode. When the briefing is finished, directions for submitting your questions will be given in the question-and-answer session. For information, this conference code is now being broadcasted live over the Internet. Webcast replay will be available within an hour after the conference is finished. please visit CHT IR website, www.cht.com.tw, slash IR, under the IR calendar section. Now I'd like to turn it over to Ms. Angela Tsai, the Director of Investor Relations. Ms. Tsai, please go ahead.

Thank you. This is Angela Tsai, Director of Investor Relations for Zhonghua Telecom. Welcome to our second quarter 2022 result conference call. Joining me on the call today are Harrison Guo, our President, and Susan Chen, our Chief Financial Officer. During today's call, management will begin by providing an overview of our business in the second quarter, followed by a discussion of segment report or segment performance and the financial highlights. After, we will move on to the question and answer portion of the call. On slide two, please note our safe harbor statement. Now, I will turn the call over to President Guo. Please go ahead, President Guo.

Thank you, Angela, and hello, everyone. Welcome to our second quarter results conference call. I will now provide an update on our robust performance in the second quarter. Let's begin on slide 4 for an overview of our mobile business. In the second quarter, Taiwan mobile market continues its momentum as the three major operators focus on 5G migration, which benefits mobile service revenue growth. Market consolidation will be fulfilled in the near future, and we remain positive to the results as it will help the market maintain steady and profitable. Under this landscape, we were pleased to report our market shares in both revenues and subscriber number continue to increase year-over-year, reaching 39% and 36.2% respectively. We are confident that we will continue our market leadership going forward. Our market leading position is backed by our 5G network deployment that has advanced and stayed ahead of our peers. The Vietnam International Institute, SpeedChase, awarded us the first 5G operator in Taiwan for the first and the second quarter of 2022. Recognizing our leadership of 5G coverage and quality. As well as the speeches that was for 65 years in a row to affirm our comprehensive and modern work as number one in Taiwan. Slide five. presents the leading achievement of our mobile business. In the second quarter, total mobile service revenue increased by 6.1% year-over-year, attributable to growing subscriber number and 5G contribution, as well as an increase in text messaging messages due to COVID-19-related projects. In addition, as many countries relaxed their border restrictions for global business travelers and tourists. We were glad to see the international running revenue begin to pick up in the second quarter. As for our mobile subscriber numbers, excluding IOTCs, there is a 0.7% year-over-year increase. In addition, our Postpay approved growth rate reached 4% year-over-year, maintaining its upward trend for five consecutive quarters. Meanwhile, we observed an average 37% uplift in monthly fees, attributable to consumers who migrate from 4G to 5G. Taken together, we offer from our peers in terms of year-over-year change in the number of post-pay subscribers, mobile service revenue, and APU, suggesting that we remain the customer's first choice of telecom service provider in Taiwan, in spite of industry consolidation. Moving on to slide six, you may find an overview of our fixed urban business. In the second quarter, our fixed urban business continued its upward trend for 11 consecutive quarters. While subscriber numbers kept stable, fixed urban revenue and approval both achieved the year-over-year increase of 4% and 3% respectively, benefiting from digital opportunities in the new format. Notably, our subscriber number for services of 300 Mbps or higher maintains its high growth rate of 37% year-over-year. To respond to customers' demands in a more aggressive manner of high-speed demand in the work of digital lifestyle, including increasing video conferences, online learning, as well as internet, celebrating economy. We roll out a promotion package to incentivize high speed service adoption of 300 Mbps and 500 Mbps and above. We are excited to see over 70% of package adopters choose 500 Mbps service and above, reflecting the success of our strategy of enhancing up-sell through space upgrades. In view of the opportunity of the promotion strategy, we anticipate further growth of our output and the market share. Now, let's move on the performance of our customer-centric business groups. Slide eight presents Revenue of our consumer business group, our CDG. Consumer business group revenue in the second quarter increased by 3.3% year-over-year, reflecting our success in satisfying customer needs during the quarter. Mobile service revenue for the consumer group grew by 5.3% year-over-year, mainly due to increase in post-paid subscriber numbers and 5G migration. In addition, 6.9% service revenue increased by 1.9% year-over-year, attributable to digital opportunities under the new normal, including work-from-home, gaming, and video services. among others. In the second quarter, we saw that Taiwan's professional baseball league games and the Internet celebrity shows were especially well-received on MLB and HEMI videos. Sales revenue increased by 2.1% year-over-year despite the hampered supply chain. issues, ongoing COVID-19, and the typical seasonings ahead of the new iPhone launch. Slide 9 further illustrates our consumer business group highlights. In the second quarter, we continue encouraging subscribers to adopt our mobile six programs and Wi-Fi services out together. The well-received promotion program reported a 13.2% quarter-over-quarter growth. In particular, our home Wi-Fi device subscription number doubled on a year-over-year basis. boosting our subscription-based revenue and the popularity of home-centric applications. In regard to our video business, we are delighted to report subscriber numbers of Homology Plus family video, which are paid in monthly fee on a yearly basis, rather than one-time sign-ups, increased by 6.6% year-over-year, mainly due to the heavy video sign-up growth driven by journal offerings and international submissions. In the second quarter, we also announced our investment in local journals and movies to expand the video business. As we plan to continue our content investment strategy to further enhance subscribers' thickness, cutting into second half, we remain confident about video service performance. As many popular sports events are expected to take place, popularity does FIFA World Cup coming up in the fourth quarter for which we obtained exclusive or casting rights. Please turn to slide 10 for an overview of our enterprise business group performance. In the second quarter, enterprise business group revenue increased by 9%. year over year, mainly due to the increase in number of projects completed, particularly the large smart energy projects of solar farms and electrical enhancement. Our enterprise ICT business revenue increased by 31.7% year over year. Meanwhile, enterprise mobile service revenues continue to increase, attributable to 5G migration and increase the demand for texts and messages as a result of COVID-19. Digital transformation demand from enterprises and the schools continue to drop off with revenues from data communication and broadband access, which offset the decrease in enterprise voice revenue during the second quarter. Slide 11 illustrates our enterprise business highlights. We are pleased to report strong growth momentum of our emerging enterprise In the second quarter, our total enterprise and emerging application revenue increased by 43.5% year-over-year. As all of our major applications demonstrated strong year-over-year growth rate above 20%. increased by 70% year-over-year in the second quarter, serving as an important growth driver thanks to our success in small energy building and surveillance fields. In fact, in the consumer sector, AIoT applications are also well-received to carry out digital lives and booming in revenues, particularly from smart speakers and smart healthcare services. We remain confident of its future development. For ITC, cloud computing and information security businesses, we continue to see strong demands both domestic and global clients, and we are glad to report year-over-year revenue growth of 24%, 25%, and 29%, respectively. Additionally, 5G private network revenue doubled its growth year-over-year. Given by an increase in acquiring project members that in projects revenue as well as recurring revenue, we are pleased about the long run contribution for big data analysis revenue. We saw 125% year over year growth and that contributed to project revenue. During the quarter, we are pleased to announce the rollout of our advanced industry-lead portable 5G plug-in network solution, which supports satellite and mobile communications and serves as the exclusive portable solution in Taiwan. Working under both Long-Standalone and standalone architecture. We also integrate our 5G AIoT sensing devices, AR technology, domestic 5G Open RAN equipment and 5G private network to offer 5G AIoT smart healthcare services. It's a hospital in Kaohsiung applying of native reality technology for elderly care. Slide 12 illustrates our international business performance. In the second quarter, it is exciting to see our international business growth rapidly increase by 17.9% year over year. attributable to the growing demand for IPC and the cloud services from global clients, particularly online global OTT service providers. In addition, as the COVID-19 pandemic restrictions were relaxed and the cross-border activities continue to resurge, We were glad to see an international running inbound revenue and the international IOT revenue increase year over year. As we look to Southeast Asian markets, we are glad to share that we signed an MOU with Tongbei Hospital in Thailand during the second quarter. to develop smart hospital solutions. We introduced our technology of cloud, AI, medical IoT, and others, and expect to extend our successful 5G private network solution in the Asian region. Now, I would like to turn the call to Vincent for our financial highlights.