China Telecom 1H Earnings Up 16%
China Telecom Corp (NYSE: CHA, HKG: 0728) posted 157.52 billion yuan in revenues and 10.21 billion yuan in net profits for 1H 2013, up 14.1% and 15.9% respectively from a year earlier. Revenue from mobile services rose 28.3% year on year to 54.6 billion yuan, or 35% of total revenue. The company was serving 175 million mobile service subscribers as of the end of June 2013, half of them 3G service users. Separately, China Telecom has paired up with NetEase Inc (Nasdaq: NTES) releasing a mobile instant messaging app known as Yixin to rival Tencent Holdings Ltd's (HKG: 0700) WeChat. China Telecom owns 73% of the joint venture, Zhejiang Yixin Technology Ltd, and NetEase the remainder. Yixin attracted over 1 million downloads within 24 hours of release. NetEase chief executive William Ding said China's mobile instant messaging market has lots of room to grow despite WeChat's current predominance.
Ajisen 1H Earnings Surge 177%
Ajisen China Holdings Ltd (HKG: 0538), China's largest noodle restaurant operator, posted HK$1.6 billion in revenues and HK$130 million in net profits for 1H 2013, up 3.8% and 177% respectively from a year earlier. JPMorgan said earnings were 53.5% above its estimate due to better-than-expected margins at food, labor and rental costs which led to a 10% net profit margin versus its estimate of 6%. Same-store sales in China were up 4.5% year on year in 1H 2013, versus a 24.7% decline a year earlier. Ajisen shut down 33 restaurants in 1H 2013, leaving a total store count of 647 as at June 30, 2013.
361 Degrees 1H Earnings Plunge 66%
361 Degrees International Ltd (HKG: 1361), a Chinese sporting goods retailer, posted 2 billion yuan in revenues and 205 million yuan in net profits for 1H 2013, down 30.4% and 65.5% respectively from a year earlier. The results were much worse than expectations. The company blamed heavy discounts and slack demand for the sharp decline in earnings.
Suning Applies for Banking License
Suning Commerce Group Co (SHE: 002024), China's largest consumer electronics retailer by revenue, confirmed it has applied for a license for online banking business. In July China began giving permits to private equity groups to found banking institutions that are expected to loan to small and midsized businesses.
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