China Unicom has issued a short statement warning its shareholders of a profits warning and stated that it now expects its net profit for 2010 to be more than halved compared to the previous year.
Although revenue of the Company had grown rapidly in 2010, the company stated that there is high pressure on its earning in 2010 due to the fast increase of depreciation and amortization, networks, operations and support expenses, as well as selling expenses, particularly the 3G handset subsidy, in relation to the initial operation stage of the Company’s 3G business.
The drop in profits compared to 2009 comes on top of the fact that 2009′s profits were themselves sharply down on 2008, by 73%. Only last week, Telefonica announced a deal to increase its stake in China Unicom to 9.7% for US$500 million.
http://www.wiireless.com/251867-china-unicom-cautions-of-50-drop-in-full-year-profit/
Although revenue of the Company had grown rapidly in 2010, the company stated that there is high pressure on its earning in 2010 due to the fast increase of depreciation and amortization, networks, operations and support expenses, as well as selling expenses, particularly the 3G handset subsidy, in relation to the initial operation stage of the Company’s 3G business.
The drop in profits compared to 2009 comes on top of the fact that 2009′s profits were themselves sharply down on 2008, by 73%. Only last week, Telefonica announced a deal to increase its stake in China Unicom to 9.7% for US$500 million.
http://www.wiireless.com/251867-china-unicom-cautions-of-50-drop-in-full-year-profit/
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