Monday, March 31, 2008

China Unicom more than doubles 2007 net profit

China Unicom Ltd <>, the smaller of the country's two mobile telecoms operators, more than doubled 2007 earnings as it vied with China Mobile <> for rural subscribers and more users switched from traditional phones to wireless.

Unicom posted a net profit of 9.3 billion yuan ($1.33 billion) for the year to Dec. 31, versus a marginally revised 3.8 billion yuan in 2006 and trouncing a forecast of 7.2 billion yuan, the average of 23 analysts polled by Reuters Estimates.

Last week, larger rival China Mobile <> , the world's top mobile phone firm, beat forecasts with a 32 percent rise in full-year net profit to 87.1 billion yuan.

Unicom said in January it estimated 2007 net earnings more than doubled, because of accounting differences and a tax refund.

As subscriber growth in China's big cities slows, margins at the country's two mobile carriers are expected to ebb amid fierce competition for less affluent customers in smaller towns and the countryside.

Shares in Unicom have fallen 1 percent this year through Wednesday's close, compared to a nearly 19 percent slide in the benchmark Hang Seng Index <.HSI>.

($1=7.016 Yuan)

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