netcom6k.htm
FORM
6-K
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
Report
of Foreign Private Issuer
Pursuant
to Rule 13a-16 or 15d-16 of
the
Securities Exchange Act of 1934
For
the month of March, 2008
(Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.)
(Indicate
by check mark whether the registrant by furnishing the information contained in
this form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934. )
(If
"Yes" is marked, indicate below the file number assigned to registrant in
connection with Rule 12g3-2(b): 82-__________. )
N/A
China
Netcom Group Corporation (Hong Kong) Limited
Building
C, No. 156, Fuxingmennei Avenue
Xicheng
District
Beijing,
100031 PRC
This
Form 6-K consists of:
1.
|
an
announcement on 2007 final results of China Netcom Group Corporation Hong
Kong) Limited (the “Registrant”);
|
2.
|
an
announcement on change of joint company secretary of the Registrant;
and
|
3.
|
a
notice on closure of register of members of the
Registrant;
|
each
made by the Registrant in English on March 25, 2008.
CHINA
NETCOM GROUP CORPORATION (HONG KONG) LIMITED
中
國
網
通
集
團
(香
港)
有
限
公
司
(Incorporated
in Hong Kong with limited liability under the Companies Ordinance)
(Stock
Code: 906)
2007
ANNOUNCEMENT OF FINAL RESULTS
CHAIRMAN’S
STATEMENT
Dear
Shareholders,
Over
the past three years, the Company has focused its efforts on strategic
transformation and reform of operating principles. In 2007, I am delighted to
report that we have made significant progress in this regard. We were able to
strengthen and reinforce our new corporate identity as a broadband and
multimedia service provider, paving the way for the Company’s rapid growth in
the future. We believe that the Company can sustain growth and create value for
shareholders as long as it follows this long-term vision.
Strategic
Transformation
In
2007, the revenue generated from innovative businesses maintained its growth
momentum and grew by 38.9% , and accounted for 34.7% of the total revenue, up
9.5 percentage points compared with the same period last year.
China’s
Internet market continued to maintain a fast growth in 2007. According to China
Internet Network Information Center, China added 73 million Internet users in
2007, reaching a total of 210 million by December 2007, up 53.3% from December
2006. The increasing use of Internet by all sectors of the public is
accelerating and the number of younger, low-income and rural users also started
to increase. People have become more reliant on Internet in their daily lives.
Access to the Internet is increasingly regarded not as a luxury but a household
necessity.
Capitalizing
on the rapid growth of the Internet market, the Company launched its “Super
Broadband Plan” to drive the growth of broadband services in two areas —
broadband access, and broadband content and applications. In terms of broadband
access, the number of broadband subscribers has been growing rapidly in the past
three years. In 2007, the growth rate of broadband subscribers was 37%, which
was 6.3 percentage points higher than that of the previous year.
In
terms of broadband content and applications, the Company is delivering
integrated content and applications directly onto the desktops of our broadband
subscribers through its “CNC MAX”. It is also running a pilot scheme of
delivering broadband content and applications to other terminals such as TVs
through technological innovation. In 2007, the Company began delivering smart
terminals and HomeBox for home multimedia information to the users in some
cities. The Company plans to deliver content and applications to user terminals
of various types and offer quadruple-play multimedia and information services as
it continues the execution of its strategic transformation into a broadband
communications and multimedia services provider.
With
the increase in our broadband subscribers and “CNC MAX” Client, and the growth
in content
and
applications, the Company has begun to develop its advertising and media
business. In 2007, through its services of “Phone Navigation”, “CNC MAX” and
“CNC Yellow Pages”, the Company is exploring its competitive advantages in the
area of advertising and media business.
During
2007, the Chinese government conducted a sweeping informatization drive. The aim
is to raise efficiency in government, improve the competitiveness of
enterprises, and upgrade living standards for the general public. The Company
clearly recognizes the opportunities presented by government policy on
informatization. To capture these, the Company has improved its ability to
provide ICT solutions to government and corporate users, particularly at the
high end of the ICT value chain. In 2007, the Company had built competitive
advantage in providing integrated solutions for e-government, pollution
monitoring, and “Safe City” etc.
Olympic
Opportunities
In
2007, the Company intensified marketing around its “Broadband Olympics”
strategy, which is expected to drive substantial growth in both broadband and
ICT services. The “Broadband Olympics” strategy is expected to deliver
significant improvements to brand image, services, management, and overall
competitiveness.
•
|
High-speed
networks: The Company launched a series of projects for the construction
of high-speed optical networks. These include an optical network
connecting all Olympic venues, the world’s first ASON + MSTP network
designed for the Olympics, and the first wide-area Centrex across the
country.
|
•
|
Easy
network access: The Olympics will highlight the wide range of access modes
offered by the Company, including LAN, EPON, McWill wireless access, and
IC card certification access.
|
•
|
Broadband
products for the Olympic Games: These include the Olympic Yellow Pages,
Broadband Olympic Content-Push, Portable USB key, and Multi-media
broadband card. The Company will soon launch new products such as the “CNC
MAX” Olympic Channel and Easy Broadband Cards in
2008.
|
•
|
Comprehensive
ICT solutions for the Olympics: Construction of an Olympic network
monitoring system has been completed, and the Company has started offering
Olympic call center services. The Company will complete a fixed-line
communications command and control system, event management network
system, and organization management system for the Olympic Games in 2008.
Capitalizing on its Olympic partnership status, the Company has signed ICT
contracts for security, transport and fire-fighting agencies associated
with the Olympic Games.
|
•
|
Higher
service standards: CNC Olympic Services standards have been established
and will be implemented in the Olympic
cities.
|
In
2007, the Company continued to improve its corporate governance focused on its
existing board governance structure.
After
reviewing the performance of the board and the directors in the year 2006, the
Company devised a plan to further enhance directors’ understanding of the
Company’s operations through professional training. This includes a system to
enable directors to exchange information and knowledge on a regular basis as
well as receive timely information on operations, in order to help them make
informed and scientific decisions on matters of significance to the Company.
This system includes regular meetings between directors and the management, and
monthly reports to directors.
In
2007, the Company launched new procedures for the selection and succession of
senior executives, which will lead to a more open, transparent and systematic
approach to appointment and succession of directors and senior
executives.
Since
2004, the Company has won recognition from public and professional bodies for
its persistent efforts in “establishing world-class corporate governance”. In
2007, the Company received the prestigious “Directors of the Year Award 2007”
from the Hong Kong Institute of Directors in the Hang Seng Index Constituents
category. The award has strengthened the Company’s confidence and commitment to
achieving the highest standards of corporate governance.
Dividend
Based
on the financial performance of the Company in 2007 and its development
strategy, the Board of Directors has proposed the payment of a final dividend of
HK$0.592 per share for the financial year ended December 31, 2007, up 7.1%
compared with HK$0.553 per share in 2006.
Resignation
and Appointment of Directors and the Management
On
January 15, 2007, Ms. Li Liming resigned as Non-Executive Director of the
Company and Mr. Li Fushen was appointed as Executive Director. On the same day,
Mr. Zhang Changsheng resigned as Senior Vice President and Mr. Zhang Xiaotie was
appointed as Senior Vice President. On July 12, 2007, Mr. Miao Jianhua resigned
as Executive Director and Mr. Tian Suning resigned as Vice-Chairman and
Non-Executive Director. On the same day, Ms. Li Jianguo was appointed as
Executive Director. On December 5, 2007, Mr. Mauricio Sartorius resigned as
Non-Executive Director and Mr. Cesareo Alierta Izuel was appointed as
Non-Executive Director. On the same day, Ms. Hong Chen Jin (Margaret Chen), was
appointed as Alternate Director to Mr. Cesareo Alierta Izuel and ceased serving
as Alternate Director to Mr. Mauricio Sartorius. On the same day, Mr. Jiang
Zhengxin was appointed as Vice President of the Company.
On
behalf of the Board, I would like to extend my sincere thanks to Mr. Miao
Jianhua, Mr. Tian Suning and Mr. Mauricio Sartorius for their outstanding
contributions to the Company during their tenures as directors. I would also
like to extend a warm welcome to Ms. Li Jianguo and Mr. Cesareo Alierta Izuel in
joining the board of directors.
Looking
into the Future
The
telecommunications industry is undergoing rapid and profound changes. It is hard
for the traditional operational model to keep up with the fast growth in demand
and the quick pace of technological innovation. We firmly believe that the only
way to sustain growth and enhance value for our shareholders is to deliver
breakthrough innovation, embrace challenge proactively, and drive trends rather
than following them.
In
2008, the Company will continue its strategic transformation into a broadband
communications and multimedia service provider. For our public subscribers, we
will leverage opportunities presented by the exponential growth of the Internet
to attract more broadband access subscribers, strengthen the integration of
content and applications, and deliver content and applications to user terminals
via “CNC MAX” Client and HomeBox. The Company will expand its advertising and
media business by optimizing its internal resources, which will generate new
factors to drive sustainable growth.
The
Company will promote ICT services for government and corporate customers and
move to a higher position on the ICT value chain. The Company will leverage its
advantages in terms of corporate resources and brand name to enter the
outsourcing industry, which will help improve its competitive edge in ICT
services and in becoming one of China’s leading providers of ICT
services.
The
Company will persevere in the pursuit of licenses for mobile services and IPTV
services which will pave the way for the Company to become a comprehensive
“broadband communications and multimedia service provider”.
Let
me extend my sincere thanks to the shareholders, customers, employees and
partners of the Company for their consistent support.
Zhang
Chunjiang
Chairman
Hong
Kong, March 25, 2008
CHIEF
EXECUTIVE OFFICER’S STATEMENT
Dear
Shareholders,
In
2007, the Company focused on innovation and its strategic transformation into a
broadband communications and multimedia services provider in respect of
technologies, businesses and systems. Innovative businesses made up 34.7% of its
revenue, up 9.5 percentage points compared to 2006. In a competitive environment
where fixed-line voice services were increasingly substituted by mobile voice
services, the successful development of innovative businesses has been crucial
in offsetting the decline of traditional fixed-line voice services and has
contributed to an increase in revenue. Through three years of hard work, the
Company is gradually moving from a telecommunications services provider of
traditional fixed-line voice services to a broadband communications and
multimedia service provider.
1. Financial
Results
As
of the end of 2007, the Company generated RMB84,005 million in revenues from
continuing operations, including amortization of upfront connection fees of
RMB1,517 million. Excluding amortization of upfront connection fees, our revenue
from continuing operations was RMB82,488 million, representing a year-on-year
growth of 0.9% (unless otherwise specified, all reported data excludes the
effect of amortization of upfront connection fees and discontinued operations).
Consolidated net profit of the Company was RMB10,578 million, including net
profit of RMB624 million generated from discontinued operations.
In
2007, capital expenditure was RMB20,684 million, representing a decline of 15.8%
from last year and a reduction of RMB316 million compared to the guidance
provided by the senior management at the beginning of the year. Benefiting from
the effective management of cash flow and capital expenditure, our free cash
flow* in 2007 was RMB11,775 million, representing a growth of
57.2%.
* Free
cash flow refers to the net cash flow from continuing operations excluding
capital expenditure.
2. Business
Review
In
2007, the substitution of fixed-line voice services by mobile voice services
accelerated. Mobile telecommunications operators accounted for 90.3% of the net
increase in the revenue of the telecommunications industry. In a fiercely
competitive market, the Company continued to implement its strategy of becoming
a broadband communications and multimedia service provider. Operationally, it
has adopted strategies to expand innovative businesses, stabilize fixed-line
voice businesses, push ahead management reforms and improve free cash flow. Our
strategy has proved to be effective.
Innovative
Businesses
In
2007, innovative businesses contributed RMB28,656 million to revenue,
representing a growth of 38.9%.
During
the year, the Company launched a “Super Broadband Plan” to take advantage of
growth opportunities presented by the rapid expansion of the Internet market in
China. Within our service regions, we increased broadband access speed, put new
operational and business models into practice, and promoted our Olympic ties and
strategy. By the end of 2007, the total number of broadband subscribers of the
Company increased 5,339 thousand to 19,768 thousand,
representing
a growth of 37.0% compared with the same period of last year and a market share
of 88.9%.
Along
with the expansion of its broadband subscriber base, the Company focused on
integrating broadband content and applications and innovating development model.
“CNC MAX” Client was launched to deliver enriched content and applications
directly to the desktops of our subscribers. New user terminals, ranging from
PCs to TV sets enriched the means of access for customers. Broadband services
generated a total revenue of RMB13,835 million in 2007, and ARPU was RMB67.4. In
particular, revenue from broadband content and applications business was
RMB1,749 million, up 107.7% from the previous year, and contributed RMB8.5 to
the average revenue per broadband subscriber.
In
2007, with the expanding “CNC MAX” Client user base and enrichment of content
and applications, the Company began to develop its advertising and media
business. In 2007, based on “Phone Navigation”, “CNC MAX” and “CNC Yellow
Pages”, the Company explored its competitive advantage in the area of
advertising and media. By the end of the year advertising and media business had
generated revenue of RMB380 million.
With
the increasing penetration of IT across all sectors of society, the fast pace of
technological change and increasing network integration, the traditional
boundaries among communications networks, the Internet, and corporate intranets
have been diminishing and this has led to the development of an integrated ICT
industry. The Company has established a long-term goal of becoming one of
China’s leading ICT service providers, as well as a network information
specialist for government and corporate customers by leveraging its brand and
resources. In 2007, the Company made great efforts to develop ICT services in
order to enhance its position in providing integrated solutions for key
customers and markets, as well as enhance its ability to provide higher-value
added services.
In
2007, the Company seized the opportunities presented by the Chinese government’s
initiative to promote information technology in administrative affairs, and
secured a number of significant integrated IT projects. It has built up its key
competitive advantages in providing integrated solutions for government,
Olympics, health, education, finance and other industries. For instance, the
Company developed business relationships with important customers such as the
State Council Informatization Office, the National People’s Congress, the
Ministry of Commerce, China International E-commerce Center and the Chinese
Academy of Medical Sciences. It has also improved its capabilities on research
and development and project management. At the end of 2007, the Company acquired
Beijing Telecommunications Planning and Designing Institute Corporation Limited.
The acquisition has brought stronger technical qualifications, broader customer
relationships and a greater number of professionals to the Company. These will
strengthen the Company’s capabilities to deliver ICT services and accelerate the
Company’s shift towards the high end of the ICT value chain. In 2007, the
Company generated RMB3,990 million in its ICT business, representing a growth of
366.7%.
In
2007, the Company focused on expanding the scope of value-added services and
increasing the penetration rate of value-added services for its fixed-line
subscribers. By the end of 2007, revenue from value-added services had increased
by 14.5% to RMB6,114 million, accounting for 7.4% of total revenue, an increase
of 0.9 percentage points from 2006. The number of Personalized Ring subscribers
was 28,137 thousand, representing a growth of 78.6%. Of this number, 19,970
thousand used fixed-line Personalized Ring, representing a growth of 124.1% and
a penetration rate of 23.6%. The penetration rate of Caller Identification
Service was 72.2%, an increase of 3.4 percentage points.
Traditional
Fixed-line Voice Services
In
2007, in the field of traditional fixed line services, the Company continued to
promote bundled services and integrated services under the brand names “Family
1+” and, “Same Number”, driving the growth of innovative businesses by bundling
various services in one package. By the end of 2007, the number of “Family 1+”
subscribers reached 8,378 thousand, representing a growth of 650.7% over the
previous year. The “Same Number” subscriber base had grown to 1,663 thousand, an
increase of 75.7%. Fast growth of the “Family 1+” service supported development
of broadband access, broadband content and applications as well as value-added
services. In 2007, more than 80% of the net growth in the broadband subscribers
of the Company also subscribed to “Family 1+”.
Due
to the increasingly rapid mobile substitution, the number of our local telephone
subscribers declined. By the end of 2007, the number had decreased by 3,152
thousand to 110,820 thousand, of which PHS subscribers numbered 26,189 thousand,
a drop of 4.1% compared with the previous year. The ARPU and traffic for local
telephone services continued to fall.
We
believe that with the growing penetration of the “Family 1+” service plan, the
steady improvement of its pricing system and shift of the service plan
positioning to home multimedia information service, the value of the fixed-line
telephone services customer will be maximized.
3. Management
Reforms
Strategic
transformation is leading the Company into new businesses such as multimedia and
IT services, where we are facing new operational models and new competitors
different from those in the traditional fixed-line voice services. The only way
to develop core competitiveness in new business areas and meet customers’
constantly changing needs is to introduce ground-breaking changes to our
management model.
Changes
in Organizational Structure
In
2007, the Company conducted a customer-oriented marketing system reform as a
starting point for changes to its organizational structure. Specialized
marketing teams were organized under three customer categories - Large
Corporates and Government, Small and Medium Enterprises, and Residentials. The
changes were made in order to improve customer satisfaction, allocate resources
more efficiently, and shift focus from marketing product to customizing
product.
Changes
in Financial Management
Strategic
transformation is also leading changes in financial management, which has
shifted focus from volume processing of transactions to decision-making support
and value creation. With a shared financial system, standard legal and
management reports as well as transaction processing are outsourced to a
financial sharing center. Standardized and process-based outsourced management
can greatly improve financial efficiency and drive down costs. The quality of
accounting and risk control management can also be improved. More importantly,
financial managers can be freed from basic transaction activities and can devote
more time to providing support for strategic decision-making and value
creation.
In
2007, the Company established the “CNC Financial Service Sharing Center”, to
share accounting, payment and revenue management processes among headquarters
and subsidiaries.
4. Development
Strategies for 2008
In
2008, the Company will focus on the following aspects of its development
strategies:
|
•
|
Implementing
the “Super Broadband Plan” to increase broadband access speed and
diversify broadband access modes and
terminals;
|
|
•
|
Developing
broadband content and applications in order to increase the market
penetration rate of “CNC MAX” Client, and to deliver broadband content and
applications to as many user terminals as possible through technological
innovation with an aim of increasing revenue contribution from the
business of broadband content and applications, as well as advertising and
media services;
|
|
•
|
Integrating
available resources to develop advertising and media businesses based on
phone search engine, Internet advertising and Yellow
Pages;
|
|
•
|
Optimizing
“Family 1+” bundled services and gradually shift its positioning to
satisfy residential customers’ needs for broadband and multimedia
information services;
|
|
•
|
Promoting
ICT services in order to enhance our capabilities to deliver high-value
added ICT services as well as strengthen our competitive edge in core
industries and areas.
|
|
•
|
Developing
ICT services to outsourcing business with a focus on call center and IDC
areas, where the Company has competitive advantages in terms of
resources.
|
|
•
|
Expanding
the customer-oriented marketing system reform, with pilot projects in a
number of provinces. The ultimate goal is to promote the system throughout
our service regions by the end of 2008. We will also further develop the
financial sharing system, and conduct trials in provincial
branches.
|
In
2008, with a focus on innovation, we will seize the historic opportunity of the
Beijing 2008 Olympic Games to speed up the Company’s strategic transformation
into a broadband communications and multimedia service provider.
I
would like to take this opportunity to express my gratitude to our customers,
shareholders, the board of directors and the staff for their support and
trust.
ZUO
Xunsheng
Chief
Executive Officer
Hong
Kong, March 25, 2008
GROUP
RESULTS
China
Netcom Group Corporation (Hong Kong) Limited (the “Company”) is pleased to
announce the audited consolidated results of the Company and its subsidiaries
(the “Group”) for the year ended December 31, 2007.
CONSOLIDATED
INCOME STATEMENT
FOR
THE YEAR ENDED DECEMBER 31, 2007
|
|
Year
ended December 31
|
|
Note
|
2007
|
2006
|
|
|
RMB
million
|
RMB
million
|
|
|
|
Restated
Note
2
|
|
|
|
|
Continuing
operations:
|
|
|
|
Revenues
|
4
|
84,005
|
84,194
|
|
|
-------
|
-------
|
|
|
|
|
Operating
expenses
|
|
|
|
Depreciation
and amortisation
|
|
(25,495)
|
(24,913)
|
Networks,
operations and support
|
|
(14,145)
|
(13,344)
|
Staff
costs
|
|
(12,223)
|
(11,849)
|
Selling,
general and administrative
|
|
(10,615)
|
(12,607)
|
Other
operating expenses
|
|
(4,261)
|
(1,930)
|
|
|
-------
|
-------
|
|
|
|
|
Total
of operating expenses
|
|
(66,739)
|
(64,643)
|
|
|
-------
|
-------
|
|
|
|
|
Other
income
|
5
|
1,221
|
621
|
Interest
income
|
|
113
|
135
|
Deficit
on revaluation of fixed assets
|
|
—
|
(1,335)
|
|
|
-------
|
-------
|
|
|
|
|
Profit
from operations
|
|
18,600
|
18,972
|
Finance
costs
|
|
(3,333)
|
(3,767)
|
|
|
-------
|
-------
|
|
|
|
|
Profit
before taxation
|
|
15,267
|
15,205
|
Taxation
|
7
|
(3,796)
|
(3,727)
|
|
|
-------
|
-------
|
|
|
|
|
Profit
for the year from continuing operations
|
|
11,471
|
11,478
|
|
|
=============
|
=============
|
Discontinued
operations:
|
|
|
|
Profit
for the year from discontinued operations
|
10
|
624
|
1,487
|
|
|
=============
|
=============
|
|
|
|
|
Profit
for the year
|
|
12,095
|
12,965
|
|
|
=============
|
=============
|
|
|
|
|
Dividends
proposed after the balance sheet date
|
8
|
3,700
|
3,695
|
|
|
=============
|
=============
|
|
|
|
|
Earnings
per share for profit from continuing
operations
attributable to shareholders of the Company
for
the year
|
|
|
|
Basic
earnings per share
|
9
|
RMB1.72
|
RMB1.74
|
|
|
=============
|
=============
|
Diluted
earnings per share
|
9
|
RMB1.70
|
RMB1.72
|
|
|
=============
|
=============
|
|
|
|
|
Earnings
per share for profit from discontinued
operations
attributable to shareholders of the Company
for
the year
|
|
|
|
Basic
earnings per share
|
9
|
RMB0.09
|
RMB0.22
|
|
|
=============
|
=============
|
Diluted
earnings per share
|
9
|
RMB0.09
|
RMB0.22
|
|
|
=============
|
=============
|
|
|
|
|
Earnings
per share from operations attributable to
shareholders
of the Company for the year
|
|
|
|
Basic
earnings per share
|
9
|
RMB1.81
|
RMB1.96
|
|
|
=============
|
=============
|
Diluted
earnings per share
|
9
|
RMB1.79
|
RMB1.94
|
|
|
=============
|
=============
|
CONSOLIDATED
BALANCE SHEET
AS
AT DECEMBER 31, 2007
|
|
As
at December 31
|
|
Note
|
2007
|
2006
|
|
|
RMB
Million
|
RMB
Million
|
|
|
|
Restated
Note
2
|
|
|
|
|
Assets
|
|
|
|
|
|
|
|
Current
assets
|
|
|
|
Cash
and bank deposits
|
|
5,395
|
7,728
|
Accounts
receivable
|
11
|
8,458
|
8,283
|
Inventories
and consumables
|
|
287
|
416
|
Prepayments,
other receivables and other
current
assets
|
|
1,021
|
1,441
|
Due
from holding companies and fellow
subsidiaries
|
|
347
|
358
|
|
|
-------
|
-------
|
|
|
|
|
Total
current assets
|
|
15,508
|
18,226
|
|
|
-------
|
-------
|
|
|
|
|
Non-current
assets
|
|
|
|
Fixed
assets
|
|
156,948
|
168,141
|
Construction
in progress
|
|
3,990
|
6,335
|
Lease
prepayments
|
|
2,494
|
2,364
|
Intangible
assets
|
|
1,552
|
1,591
|
Deferred
tax assets
|
|
2,693
|
3,459
|
Other
non-current assets
|
|
3,243
|
3,966
|
|
|
-------
|
-------
|
|
|
|
|
Total
non-current assets
|
|
170,920
|
185,856
|
|
|
-------
|
-------
|
|
|
|
|
Total
assets
|
|
186,428
|
204,082
|
|
|
=============
|
=============
|
|
|
As
at December 31
|
|
Note
|
2007
|
2006
|
|
|
RMB
million
|
RMB
million
|
|
|
|
Restated
Note
2
|
Liabilities
and equity
|
|
|
|
|
|
|
|
Current
liabilities
|
|
|
|
Accounts
payable
|
12
|
15,639
|
17,661
|
Accruals
and other payables
|
|
2,950
|
3,074
|
Short
term commercial paper
|
|
20,000
|
9,811
|
Short
term bank loans
|
|
11,850
|
30,980
|
Current
portion of long term bank and other
loans
|
|
5,322
|
7,304
|
Due
to holding companies and fellow
subsidiaries
|
|
4,598
|
7,505
|
Current
portion of deferred revenues
|
|
7,103
|
7,733
|
Current
portion of provisions
|
|
3,381
|
3,736
|
Taxation
payable
|
|
3,750
|
3,029
|
|
|
-------
|
-------
|
|
|
|
|
Total
current liabilities
|
|
74,593
|
90,833
|
|
|
-------
|
-------
|
|
|
|
|
Net
current liabilities
|
|
(59,085)
|
(72,607)
|
|
|
-------
|
-------
|
|
|
|
|
Total
assets less current liabilities
|
|
111,835
|
113,249
|
|
|
-------
|
-------
|
|
|
|
|
Non-current
liabilities
|
|
|
|
Long
term bank and other loans
|
|
14,425
|
23,219
|
Corporate
bonds
|
|
2,000
|
—
|
Due
to holding companies and fellow
subsidiaries
|
|
6,169
|
5,880
|
Deferred
revenues
|
|
4,314
|
6,198
|
Provisions
|
|
2,007
|
2,586
|
Deferred
tax liabilities
|
|
856
|
1,156
|
Other
non-current liabilities
|
|
12
|
16
|
|
|
-------
|
-------
|
|
|
|
|
Total
non-current liabilities
|
|
29,783
|
39,055
|
|
|
-------
|
-------
|
|
|
|
|
Total
liabilities
|
|
104,376
|
129,888
|
|
|
-------
|
-------
|
|
|
|
|
Financed
by:
|
|
|
|
Share
capital
|
|
2,206
|
2,199
|
Reserves
|
|
79,846
|
71,995
|
|
|
-------
|
-------
|
|
|
|
|
Shareholders’
equity
|
|
82,052
|
74,194
|
|
|
-------
|
-------
|
|
|
|
|
Total
liabilities and equity
|
|
186,428
|
204,082
|
|
|
=============
|
=============
|
1 Background
of the Group
China
Netcom Group Corporation (Hong Kong) Limited (the “Company”) was incorporated in
the Hong Kong Special Administrative Region (“Hong Kong”) of the People’s
Republic of China (“PRC”) on October 22, 1999 as a limited liability company
under the Hong Kong Companies Ordinance. The Company, China Netcom Holdings and
China Network Communications Group Corporation (the “China Netcom Group”)
underwent a reorganization conducted for the listing of the shares of the
Company (the “Listing Reorganization”) on June 30, 2004. Following the Listing
Reorganization, the shares of the Company were listed on The Stock Exchange of
Hong Kong Limited on November 17, 2004 and the ADSs of the Company were listed
on The New York Stock Exchange Inc. on November 16, 2004. After the Listing
Reorganization, the Company’s ultimate holding company was China Netcom
Group.
After
the Listing Reorganization and acquisition of China Netcom Group New Horizon
(BVI) Limited and China Netcom Group New Horizon Telecommunication Limited, the
Company and its subsidiaries (the “Group”) is the dominant provider of fixed
line voice and value-added services, broadband and other internet-related
services, information communications technology services, business and data
communications services and advertising and media services in ten northern
provinces, municipalities and autonomous region in PRC, namely Beijing
Municipality, Tianjin Municipality, Hebei Province, Liaoning Province, Shandong
Province, Henan Province, Shanxi Province, Neimenggu Autonomous Region, Jilin
Province, and Heilongjiang Province. The Group also provided telecommunications
services to selected business and residential customers in two southern
municipality and province, namely Shanghai Municipality and Guangdong Province
in the PRC.
On
June, 2, 2006, the Group entered into an agreement with third party buyers to
dispose of its entire interest in the ANC Group for an aggregate cash
consideration of US$168.84 million, at fair value determined by both parties.
The transaction was completed on August 22, 2006.
On
January 15, 2007, the Company’s wholly owned subsidiary, China Netcom (Group)
Company Limited (“CNC China”), entered into an assets transfer agreement with
its ultimate holding Company, China Netcom Group. Pursuant to the agreement, CNC
China agreed to dispose of its assets and liabilities in relation to its
telecommunications operations in Guangdong Province and Shanghai Municipality
branches (“Guangdong and Shanghai Branches”) in the PRC for consideration of
RMB3.5 billion. On February 14, 2007, the independent shareholders passed an
ordinary resolution to approve the disposal. The disposal was completed on
February 28, 2007 upon the approval granted from the Ministry of Information
Industry (“MII”). After the disposal of the Guangdong and Shanghai branches, the
Group only provides telecommunication operations in the ten northern provinces,
municipalities and autonomous region.
On
December 5, 2007, China Netcom Group System Integration Limited Corporation
(“System Integration Corporation”), a wholly-owned subsidiary of CNC China,
entered into an Equity Interest Transfer Agreement with China Netcom Group
Beijing Communications Corporation, pursuant to which System Integration
Corporation agreed to acquire the entire equity interest of Beijing
Telecommunications Planning and Designing Institute Corporation Limited
(“Beijing Telecom P&D Institute”) from China Netcom Group Beijing
Communications Corporation for a total consideration of RMB298.9 million. The
consideration was paid through a one-off cash payment. The acquisition was
registered with Beijing Property Transaction Administrative House and the
ownership was transferred on December 31, 2007. Prior to the acquisition,
Beijing Telecom P&D Institute was a wholly owned subsidiary of China Netcom
Group Beijing Communications Corporation, which is a wholly owned subsidiary of
China Netcom Group.
Currently,
the Group’s principal services consist of:
• Fixed
line voice and value-added services, comprising:
|
|
|
|
(a) |
Local,
domestic long distance and international long distance
services; |
|
|
|
|
(b) |
Value-added
services, including caller identity, personalised ring, etc;
and |
|
|
|
|
(c)
|
Interconnection
services provided to other domestic telecommunications service providers
including the fellow subsidiaries owned by China Netcom Group operating
outside the ten service regions;
|
• Broadband
services and other Internet-related services;
|
•
|
Information
Communications Technology Services, including system integration, software
services, outsourcing services, professional consulting services,
professional services related with network information and disaster
recovery, and other integrated solutions to client based on information
and communications industry;
|
|
•
|
Business
and data communications services, including managed data services and
leased line services;
|
|
•
|
Advertising
and media services.
|
2 Basis
of presentation
The
consolidated financial statements have been prepared in accordance with Hong
Kong Financial Reporting Standards (“HKFRS”), Hong Kong Accounting Standards
(“HKAS”) and interpretations issued by the Hong Kong Institute of Certified
Public Accountants (‘‘HKICPA’’). They have also been prepared in accordance with
the disclosure requirements of the Companies Ordinance and Rules Governing the
Listing Securities on The Stock Exchange of Hong Kong Limited. They have been
prepared under the historical cost convention modified by the revaluation of
certain fixed assets in 2006 and on a going concern basis.
A
significant percentage of the Group’s funding requirements is achieved through
short term borrowings. Consequently, the balance sheet indicates a significant
working capital deficit. Based on the Group’s history of obtaining financing,
its relationship with its bankers and its operating performance, the board of
directors consider that the Group will continue to be able to roll over such
short term financing, or will be able to obtain sufficient alternative sources
of financing to enable it to operate and meet its liabilities as and when they
fall due.
On
June 2, 2006, the Group entered into an agreement with third party buyers to
dispose of the entire interests in the ANC Group and the disposal was completed
on August 22, 2006. On January 15, 2007, CNC China entered into an assets
transfer agreement with China Netcom Group to dispose of its assets and
liabilities in relation to its telecommunications operations in Guangdong and
Shanghai Branches in the PRC and the disposal was completed on February 28,
2007. In accordance with Hong Kong Financial Reporting Standard (“HKFRS”) 5
“Non-current assets held for sale and discontinued operations” issued by the
HKICPA, the results of the operations of the ANC Group and the Guangdong and
Shanghai Branches have been presented as discontinued operations. The 2006
comparative figures in the income statement were restated to reflect the
disposal of Guangdong and Shanghai branches accordingly.
On
December 5, 2007, System Integration Corporation entered into an Equity Interest
Transfer Agreement with China Netcom Group Beijing Communications Corporation,
pursuant to which System Integration Corporation agreed to acquire the entire
equity interest of Beijing Telecom P&D Institute from China Netcom Group
Beijing Communications Corporation. Before the acquisition, Beijing Telecom
P&D Institute was a wholly owned subsidiary of China Netcom Group Beijing
Communications Corporation, which is a wholly owned subsidiary of China Netcom
Group. Since China Netcom Group is the ultimate holding company of the Group,
the acquisition is a business combination under common control. Therefore, the
Group accounted for this acquisition using the pooling of interest method
according to Accounting Guideline No. 5 - Merger Accounting for Common Control
Transactions (“AG 5”). The acquired businesses and assets are recorded at book
value under HKFRS as if the businesses and assets of Beijing Telecom P&D
Institute have been owned by the Group from the earliest comparative period
presented. Accordingly, the financial information for 2006 has been
restated.
3 Changes
in accounting policies
|
|
|
|
(a) |
Standards,
amendment and interpretations effective in 2007 |
|
|
|
|
|
HKFRS
7, ‘Financial instruments: Disclosures´, and the complementary amendment
to HKAS 1 |
|
|
|
|
|
HK(IFRIC)
- Int 8, ‘Scope of HKFRS 2´
|
|
|
|
|
|
HK(IFRIC)
- Int 10, ‘Interim financial reporting and impairment´ |
|
|
|
|
(b) |
Interpretation
early adopted by the Group |
|
|
|
|
|
HK(IFRIC)
- Int 13, ‘Customer loyalty programmes´ |
|
|
|
|
(c)
|
Standards,
amendments and interpretations effective in 2007 but not
relevant
|
|
|
|
|
|
The
following standards, amendments and interpretations to published standards
are mandatory for accounting periods beginning on or after January 1 2007
but they are not relevant to the Group’s
operations: |
|
|
•
|
HK(IFRIC)
- Int 7, ‘Applying the restatement approach under HKAS 29, Financial
reporting in hyper-inflationary economies´
|
|
|
|
|
|
|
• |
HK(IFRIC)
— Int 9, ‘Re-assessment of embedded derivatives´ |
|
|
|
|
|
|
• |
HKFRS
4 (revised) - ‘Amendment to ‘Financial guarantee
contracts´’ |
|
(d)
|
Standards,
amendments and interpretations to existing standards that are not yet
effective and have not been early adopted by the Group
|
|
|
|
|
|
The
following standards, amendments and interpretations to existing standards
have been published and are mandatory for the Group’s accounting periods
beginning on or after January 1 2008 or later periods, but the Group has
not early adopted them: |
|
|
•
|
HK(IFRIC)
- Int 11, HKFRS 2 — Group and treasury share
transactions´
|
|
|
|
|
|
|
• |
HK(IFRIC)
— Int 12, ‘Service concession arrangement’
|
|
|
|
|
|
|
• |
HKAS
23 (Amendment), ‘Borrowing costs´
|
|
|
|
|
|
|
• |
HKFRS
8, ‘Operating segments´ |
|
|
|
|
|
|
•
|
HK(IFRIC)
- Int 14, ‘HKAS 19 — The limit on a defined benefit asset, minimum funding
requirements and their
interaction´
|
Revenues
represent the turnover of the Group and are derived from the provision of fixed
line telecommunications and related services, net of the PRC business taxes and
government levies amounting to RMB2,358 million (2006: RMB2,387 million). The
Group’s revenues by business nature can be summarized as follows:
|
Year
ended December 31
|
|
2007
|
2006
|
|
RMB
million
|
RMB
million
|
|
|
Restated
Note
2
|
|
|
|
Revenues
|
|
|
Local
usage fees
|
19,989
|
22,059
|
Monthly
telephone services
|
12,387
|
16,546
|
Upfront
installation fees
|
1,283
|
1,364
|
DLD
usage fees
|
8,769
|
9,495
|
ILD
usage fees
|
791
|
819
|
Value-added
services
|
6,114
|
5,341
|
Interconnection
fees
|
8,376
|
8,432
|
Upfront
connection fees
|
1,517
|
2,406
|
Broadband
services
|
13,835
|
9,916
|
Other
Internet-related services
|
532
|
516
|
Managed
data services
|
1,284
|
1,413
|
Leased
line income
|
2,521
|
2,540
|
Information
communications technology services
|
3,990
|
855
|
Other
services
|
2,617
|
2,492
|
|
-------
|
-------
|
Total
|
84,005
|
84,194
|
|
=============
|
=============
|
5 Other
income
Other
income is the subsidy income the Company received arising from the reinvesting
of the profit distributions received from a subsidiary in the PRC to that
subsidiary.
6 Segmental
reporting
Business
segments provide services that are subject to risks and returns that are
different from other business segments. Geographical segments provide services
within a particular economic environment that is subject to risks and returns
that differ from those of components operating in other economic environments.
Currently the Group has one business segment, the provision of fixed line
telecommunications services. Less than 10% of the Group’s assets and operations
are located outside the PRC. Accordingly, no business and geographical segment
information is presented.
7
Taxation
|
Year
ended December 31
|
|
2007
|
2006
|
|
RMB
million
|
RMB
million
|
|
|
Restated
Note
2
|
|
|
|
PRC
enterprise income tax (“EIT”)
|
3,901
|
4,143
|
Overseas
profit tax
|
12
|
20
|
Deferred
taxation- Continuing operations
|
(66)
|
(436)
|
Deferred
taxation -Change in statutory taxation rate
|
(51)
|
—
|
|
-------
|
-------
|
Taxation
charges
|
3,796
|
3,727
|
|
=============
|
=============
|
The
provision for PRC EIT is calculated based on the statutory income tax rate of
33% on the assessable profit of each of the entities comprising the Group in the
PRC as determined in accordance with the relevant income tax rules and
regulations in the PRC.
Taxation
on profits derived from certain subsidiaries outside the PRC, including Hong
Kong, has been calculated on the estimated assessable profit at the rates of
taxation ranging from 17.50% to 34.00%, prevailing in the countries in which
those entities operate.
On
March 16, 2007, the National People’s Congress approved the Corporate Income Tax
Law of the People’s Republic of China (the “New CIT Law”). This New CIT Law
reduces the corporate income tax rate for domestic enterprises from 33% to 25%
with effect from January 1, 2008. As a result of the new CIT Law, as at March
16, 2007, the carrying value of deferred tax assets has been written down by
RMB775 million, with RMB111 million recognised in income statement and RMB664
million recognised in equity. The carrying value of deferred tax liabilities has
been written down by RMB273 million, with RMB162 million recognised in the
income statement and RMB111 million recognised in equity. The impact of the
change in deferred taxation recognised in either the current income statement or
equity as a result of the New CIT Law corresponded to whether the related items
were previously recognised in income statement or equity.
8 Profit
distributions
|
Year
ended December 31
|
|
2007
|
2006
|
|
HK$
million
|
RMB
million
|
HK$
million
|
RMB
million
|
|
|
|
|
|
Final
dividend proposed after balance sheet date of HK$0.592 per
share (2006: HK$0.553 per share)
|
3,951
|
3,700
|
3,678
|
3,695
|
|
=============
|
=============
|
=============
|
=============
|
Dividend
distributed during the year
|
3,678
|
3,600
|
3,073
|
3,196
|
|
=============
|
=============
|
=============
|
=============
|
In
the meeting of the board of directors held on March 25, 2008, the directors
proposed a final dividend of HK$0.592 per ordinary share for the year ended
December 31, 2007. Dividends proposed after the balance sheet date have not been
reflected as a dividend payable and will be reflected as an appropriation in the
2008 financial statements.
9 Earnings
per share
Basic
earnings per share is computed using the weighted average number of ordinary
shares outstanding during the year. Diluted earnings per share is computed using
the weighted average number of ordinary shares and potential ordinary shares
outstanding during the year.
The
following table sets forth the computation of basic and diluted earnings per
share:
|
Year
ended December 31
|
|
2007
|
2006
|
|
(in
RMB millions, except share and per share data)
|
|
|
Restated
Note
2
|
|
|
|
Numerator:
|
|
|
Profit
for the year
|
|
|
-
Continuing operations
|
11,471
|
11,478
|
-
Discontinued operations
|
624
|
1,487
|
|
-------
|
-------
|
|
12,095
|
12,965
|
|
-------
|
-------
|
Denominator
|
|
|
Weighted
average number of ordinary shares outstanding and shares used in computing
basic earnings per share
|
6,657,045,212
|
6,615,520,381
|
Diluted
equivalent shares arising from share options
|
80,583,956
|
51,955,496
|
|
-------
|
-------
|
Shares
used in computing diluted earnings per share
|
6,737,629,168
|
6,667,475,877
|
|
-------
|
-------
|
Basic
earnings per share (RMB)
|
|
|
-
Continuing operations
|
1.72
|
1.74
|
|
-------
|
-------
|
-
Discontinued operations
|
0.09
|
0.22
|
|
-------
|
-------
|
-
Profit for the year
|
1.81
|
1.96
|
|
=============
|
=============
|
Diluted
earnings per share (RMB)
|
|
|
-
Continuing operations
|
1.70
|
1.72
|
|
-------
|
-------
|
-
Discontinued operations
|
0.09
|
0.22
|
|
-------
|
-------
|
-
Profit for the year
|
1.79
|
1.94
|
|
=============
|
=============
|
10 Discontinued
operations
On
January 15, 2007, CNC China entered into an assets transfer agreement with its
ultimate holding Company, China Netcom Group. Pursuant to the agreement, CNC
China agreed to dispose of its assets and liabilities in relation to its
telecommunications operations in Guangdong Province and Shanghai Municipality
branches. The disposal was completed on February 28, 2007. The gain on disposal
amounted to RMB626 million. The results of Guangdong and Shanghai Branches for
the year ended December 31, 2007 and 2006 are presented as discontinued
operations.
On
June 2, 2006, the Group entered into an agreement with third party buyers to
dispose of its entire interest in the ANC Group for an aggregate cash
consideration of US$168.84 million. The disposal was completed on August 22,
2006. The gain on disposal amounted to RMB1,878 million. The results of the ANC
Group for the year ended December 31, 2006 are presented as discontinued
operations.
The
income statements related to discontinued operations are as
follows:
|
Disposal
of Guangdong and Shanghai branches
|
Disposal
of ANC Group
|
Total
|
|
For
the
period
from January 1,
2007
to
February
28,
2007
|
For
the year ended
December
31,
2006
|
For
the year
ended
December
31,
2007
|
For
the
period
from
January
1,
2006
to
August
22,
2006
|
For
the year
ended
December
31,
2007
|
For
the year ended
December
31,
2006
|
|
RMBmillion
|
RMBmillion
|
RMBmillion
|
RMBmillion
|
RMBmillion
|
RMBmillion
|
|
|
|
|
|
|
|
Discontinued
operations
|
|
|
|
|
|
|
Revenues
|
615
|
3,222
|
—
|
980
|
615
|
4,202
|
Expenses
|
(618)
|
(3,717)
|
—
|
(1,038)
|
(618)
|
(4,755)
|
|
-------
|
-------
|
-------
|
-------
|
-------
|
-------
|
Loss
before taxation of discontinued operations
|
(3)
|
(495)
|
—
|
(58)
|
(3)
|
(553)
|
Taxation
|
1
|
163
|
—
|
(1)
|
1
|
162
|
|
-------
|
-------
|
-------
|
-------
|
-------
|
-------
|
Loss
for the period of discontinued operations
|
(2)
|
(332)
|
—
|
(59)
|
(2)
|
(391)
|
|
-------
|
-------
|
-------
|
-------
|
-------
|
-------
|
Gain
on disposal of discontinued operations before taxation
|
927
|
—
|
—
|
1,878
|
927
|
1,878
|
Taxation
|
(301)
|
—
|
—
|
—
|
(301)
|
—
|
|
-------
|
-------
|
-------
|
-------
|
-------
|
-------
|
Gain
on discontinued operations after taxation
|
626
|
—
|
—
|
1,878
|
626
|
1,878
|
|
-------
|
-------
|
-------
|
-------
|
-------
|
-------
|
Profit/(loss)for
the period/year from discontinued operations
|
624
|
(332)
|
—
|
1,819
|
624
|
1,487
|
|
=============
|
=============
|
=============
|
=============
|
=============
|
=============
|
11 Accounts
receivable
Amounts
due from the provision of fixed line telecommunications services to residential
and business customers are due within 30 days from the date of billing.
Residential customers who have accounts overdue by more than 90 days will in
normal circumstances have their services disconnected. Accounts receivable from
other telecommunications operators and customers are due generally between 30 to
90 days from the billing date.
The
aging analysis of accounts receivable based on the billing date is as
follows:
|
As
at December 31
|
|
2007
|
2006
|
|
RMB
million
|
RMB
million
|
|
|
Restated
Note
2
|
|
|
|
0-30
days
|
5,682
|
5,744
|
31-90
days
|
1,866
|
1,557
|
Over
90 days
|
2,308
|
2,326
|
|
-------
|
-------
|
Total
|
9,856
|
9,627
|
|
-------
|
-------
|
Less:
Allowance for doubtful debts
|
(1,398)
|
(1,344)
|
|
-------
|
-------
|
Net
carrying amounts
|
8,458
|
8,283
|
|
=============
|
=============
|
12 Accounts
payable
|
As
at December 31
|
|
2007
|
2006
|
|
RMB
million
|
RMB
million
|
|
|
Restated
Note
2
|
|
|
|
0-30
days
|
6,214
|
5,763
|
31-60
days
|
1,462
|
2,236
|
61-90
days
|
1,266
|
1,449
|
91-180
days
|
2,251
|
2,990
|
Over
180 days
|
4,446
|
5,223
|
|
-------
|
-------
|
Total
|
15,639
|
17,661
|
|
=============
|
=============
|
13 Significant
subsequent events
|
(i)
|
After
the balance sheet date the directors proposed a final dividend. Further
details are disclosed in Note 8.
|
|
(ii)
|
The
Group borrowed two foreign currency loans of HK$ 1 billion each from a
bank in Hong Kong on February 1 and February 4, 2008 respectively. Both of
the loans will mature on December 31, 2008. The actual annual interest
rates charged are 2.53% and
2.557%.
|
AUDIT
COMMITTEE
The
Audit Committee reviewed with management the accounting principles and practices
adopted by the Group and discussed auditing, internal control and financial
reporting matters including the review of the audited financial statements for
the year ended December 31, 2007.
COMPLIANCE
WITH THE CODE PROVISIONS OF THE CODE ON CORPORATE GOVERNANCE
PRACTICES
The
Company has complied with all code provisions of the Code on Corporation
Governance Practices as set out in Appendix 14 to the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited throughout the
year ended December 31, 2007.
Under
the amended Section 303A of the New York Stock Exchange Listed Company Manual,
foreign issuers (including the Company) listed on the New York Stock Exchange,
Inc. (the “NYSE”) are required to disclose a summary of the significant
differences between their domestic corporate governance rules and NYSE corporate
governance rules that would apply to a U.S. domestic issuer. A summary of such
difference appears on our website at http://www.china-netcom.com/eng/about/
summary.htm.
PURCHASE,
SALE OR REDEMPTION OF THE COMPANY’S LISTED SECURITIES
The
Company and its subsidiaries did not purchase, sell or redeem any of the listed
securities of the Company during the year.
CLOSURE
OF REGISTER OF MEMBERS
The
register of members of the Company will be closed from May 19, 2008 to May 22,
2008 (both days inclusive), during which period no transfer of shares in the
Company will be effected. In order to qualify for the proposed final dividend,
all transfers, accompanied by the relevant share certificates, must be lodged
with the Company’s share registrar, Computershare Hong Kong Investor Services
Limited, Rooms 1712-1716, 17th Floor, Hopewell Centre, 183 Queen’s Road East,
Wan Chai, Hong Kong, not later than 4:30 p.m. on May 16, 2008.
PUBLICATION
OF ANNUAL REPORT ON THE WEBSITE OF THE STOCK EXCHANGE OF HONG KONG LIMITED AND
THE COMPANY
The
Annual Report for the year ended December 31, 2007 will be published on the
website of The Stock Exchange of Hong Kong Limited (www.hkex.com.hk) as well as
the website of the Company (www.china-netcom.com).
FORWARD-LOOKING
STATEMENTS
This
announcement includes “forward-looking statements” within the meaning of the
Private Securities Litigation Reform Act of 1995. Save for statements of
historical facts, all statements in this announcement that address activities,
events or developments which the Company expects or anticipates will or may
occur in the future are hereby identified as forward looking statements for the
purposed of the safe harbour provided by Section 27A of the U.S. Securities Act
of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of
1934, as amended. The words such as believe, intend, expect, anticipate,
project, estimate, predict, plan and similar expression are also intended to
identify forward-looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors, which may cause the
actual performance, financial condition or results of operations of the Company
to be materially different from any future performance, financial condition or
results of operations implied by such forward-looking statements. Further
information regarding these risks, uncertainties and other factors is included
in the Company’s Annual Report on Form 20-F filed with the U.S. Securities and
Exchange Commission (the “SEC”) and in the Company’s other filings with the
SEC.
As
at the date of this announcement, the board of directors of the Company
comprises Mr. Zhang Chunjiang, Mr. Zuo Xunsheng, Ms. Li Jianguo, Mr. Zhang
Xiaotie and Mr. Li Fushen as executive directors, Mr. Yan Yixun, Mr. Cesareo
Alierta Izuel and Mr. José María Álvarez-Pallete as non-executive directors and
Mr. John Lawson Thornton, Mr. Victor Cha Mou Zing, Dr. Qian Yingyi, Mr. Hou
Ziqiang and Mr. Timpson Chung Shui Ming as independent non-executive
directors.
CHINA
NETCOM GROUP CORPORATION (HONG KONG) LIMITED
(Incorporated
in Hong Kong with limited liability under the Companies Ordinance)
(Stock
Code: 906)
CHANGE
OF JOINT COMPANY SECRETARY
The
Board of Directors (the “Board”) of China Netcom Group Corporation (Hong Kong)
Limited (the “Company”) announces that Mr. Li Fushen has resigned as Joint
Company Secretary of the Company with effect from 25 March 2008. Mr.
Li Fushen continues to serve as an Executive Director and Chief Financial
Officer of the Company.
The
Board further announces that Mr. Huo Haifeng, Vice President of the Company, has
been appointed by the Board to replace Mr. Li Fushen as a Joint Company
Secretary of the Company with effect from 25 March 2008. Mr. Huo will
be assisted by Miss Mok Kam Wan, the other Joint Company Secretary of the
Company, to discharge his functions as a Joint Company
Secretary. Miss Mok Kam Wan is an associate member of The Institute
of Chartered Secretaries and Administrators and The Hong Kong Institute of
Chartered Secretaries. The Company has applied for, and The Stock
Exchange of Hong Kong Limited has granted, a conditional waiver from strict
compliance with the requirements under Rule 8.17 of the Rules Governing the
Listing of Securities on The Stock Exchange of Hong Kong Limited (the “Listing
Rules”) for a period of three years from 25 March 2008 in respect of the
appointment of Mr. Huo Haifeng as one of the joint company secretaries of the
Company. The waiver is granted on the condition that Mr. Huo Haifeng,
who does not meet the requirements of Rule 8.17 of the Listing Rules, should be
assisted by a qualified person who possesses the relevant professional
qualifications required under Rule 8.17(2) of the Listing Rules during the
three-year period so as to enable Mr. Huo Haifeng to acquire the “relevant
experience” within the meaning of the Rule 8.17(3) of the Listing Rules to
discharge his functions as a company secretary of the Company. Miss
Mok Kam Wan is a qualified person possessing the relevant professional
qualifications required under Rule 8.17(2) of the Listing Rules.
Mr.
Huo Haifeng has served as the Vice President of the Company from December 2006
and is currently in charge of risk management and legal affairs of the Company.
Mr. Huo was the General Manager of Tianjin Communications Company from August
2004 to November 2006 and served as the General Manager of Dalian Branch of
Liaoning Communications Company from December 2002 to August
2004. Mr. Huo was the General Manager of Dalian Branch of Liaoning
Telecommunications Company of former China Telecom Group from April 2001 to
December 2002. He worked as the General Manager of Anshan Branch of
Liaoning Telecommunications Company from August 2000 to April 2001. Mr. Huo
served as Director of Bureau of Telecommunications Administration in Anshan city
of Liaoning Province from October 1998 to August 2000. Mr. Huo
graduated from Changchun University of Posts and Telecommunications on the major
of computer application in July 1987, and from Beijing University of Posts and
Telecommunications Graduate School in August 1998, and obtained a master’s
degree of business management from Australian National University in October
2002.
|
By
Order of the Board
CHINA
NETCOM GROUP CORPORATION
(HONG
KONG) LIMITED
Zhang
Chunjiang
Chairman
|
Hong
Kong, 25 March 2008
As
at the date of this announcement, the board of directors of the Company
comprises Mr. Zhang Chunjiang, Mr. Zuo Xunsheng, Ms. Li Jianguo, Mr. Zhang
Xiaotie and Mr. Li Fushen as executive directors, Mr. Yan Yixun, Mr. Cesareo
Alierta Izuel, and Mr. José María Álvarez-Pallete as non-executive directors,
and Mr. John Lawson Thornton, Mr. Victor Cha Mou Zing, Dr. Qian Yingyi, Mr. Hou
Ziqiang and Mr. Timpson Chung Shui Ming as independent non-executive
directors.
CHINA
NETCOM GROUP CORPORATION (HONG KONG) LIMITED
中
國
網
通
集
團
(香
港)
有
限
公
司
(Incorporated
in Hong Kong with limited liability under the Companies Ordinance)
(Stock
Code: 906)
CLOSURE
OF REGISTER OF MEMBERS
This
notice is made pursuant to section 99 of the Companies Ordinance (Chapter 32 of
Laws of Hong Kong). Reference is also made to the 2007 annual results
announcement of China Netcom Group Corporation (Hong Kong) Limited (the “Company”) published on 25
March 2008.
Notice
is hereby given that the register of members of the Company will be closed from
19 May 2008 to 22 May 2008 (both days inclusive). During this period, no
transfer of shares will be registered. In order to qualify for the proposed 2007
final dividend, all transfers of shares accompanied by the relevant share
certificates must be lodged with the Company’s share registrar, Computershare
Hong Kong Investor Services Limited, Rooms 1712-1716, 17th Floor, Hopewell
Centre, 183 Queen’s Road East, Wan Chai, Hong Kong not later than 4:30 p.m. on
16 May 2008. The final dividend will be paid on or about 12 June 2008 to those
shareholders on the register of members on 22 May 2008.
|
By
order of the Board
China Netcom Group
Corporation
(Hong
Kong) Limited
|
|
Huo
Haifeng
|
Mok
Kam Wan
|
|
Joint
Company Secretaries
|
Hong
Kong, 25 March 2008
As
at the date of this announcement, the board of directors of the Company
comprises Mr. Zhang Chunjiang, Mr. Zuo Xunsheng, Ms. Li Jianguo, Mr. Zhang
Xiaotie and Mr. Li Fushen as executive directors, Mr. Yan Yixun, Mr. Cesareo
Alierta Izuel and Mr. José María Álvarez-Pallete as non-executive directors and
Mr. John Lawson Thornton, Mr. Victor Cha Mou Zing, Dr. Qian Yingyi, Mr. Hou
Ziqiang and Mr. Timpson Chung Shui Ming as independent non-executive
directors.
SIGNATURE
Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed on its behalf by the under-signed, thereunto duly
authorized.
CHINA NETCOM GROUP CORPORATION (HONG
KONG) LIMITED
By /s/
Huo
Haifeng
By /s/
Mok Kam
Wan
Name: Huo Haifeng and
Mok Kam Wan
Title: Joint
Company
Secretaries
Date:
March 26, 2008