Business Context and Reporting Period
This Form 6-K filing by Chunghwa Telecom Co., Ltd. is dated May 12, 2004. The report summarizes corporate announcements and operational data covering the full fiscal year 2003, the first quarter of 2004, and specific monthly updates for April 2004. The company is a foreign private issuer based in Taipei, Taiwan.
Key Financial Metrics
Fiscal Year 2003 Results
- Total Revenue: NT$179.1 billion
- Gross Profit: NT$88.4 billion
- Income from Operations: NT$58.3 billion
- Net Income: NT$48.5 billion
- Earnings Per Share (EPS): NT$5.03
First Quarter 2004 Results
- Total Revenue: NT$45.0 billion
- Gross Profit: NT$22.6 billion
- Income from Operations: NT$15.5 billion
- Net Income: NT$12.9 billion
- Earnings Per Share (EPS): NT$1.34
April 2004 and Year-to-Date (Jan-Apr) Performance
- April Net Sales: NT$15.29 billion (3.4% increase vs. April 2003)
- Jan-Apr Net Sales: NT$60.28 billion (4.0% increase vs. prior year period)
- Jan-Apr Net Income: NT$17.1 billion
- Jan-Apr EPS: Approximately NT$1.78
2004 Financial Forecast
- Projected Service Revenues: NT$177.2 billion
- Projected Net Income: NT$41.6 billion
- Projected Basic Net Income Per Share: NT$4.31
- Total Assets (Forecast): NT$447.4 billion
- Total Liabilities (Forecast): NT$51.2 billion
Material Changes vs. Prior Period
- Revenue Growth: Full-year 2003 service revenues increased to NT$179.1 billion from NT$176.1 billion in 2002. First-quarter 2004 revenues rose to NT$45.0 billion from NT$43.2 billion in 1Q03.
- Profitability: Net income for 2003 grew to NT$48.5 billion from NT$43.2 billion in 2002. 1Q04 net income increased to NT$12.9 billion from NT$10.8 billion in 1Q03.
- EPS Growth: Full-year EPS improved from NT$4.48 in 2002 to NT$5.03 in 2003. 1Q04 EPS rose from NT$1.12 to NT$1.34.
Guidance, Outlook, and Corporate Actions
Dividend Proposal
The Board of Directors resolved on April 15, 2004, to distribute a cash dividend of NT$4.5 per share. This proposal is subject to shareholder approval at the Annual General Meeting scheduled for June 25, 2004.
Financial Forecast
On April 29, 2004, the company voluntarily released a financial forecast for 2004, projecting net income of NT$41.6 billion and EPS of NT$4.31. This forecast was reviewed by CPAs Victor Wang and Lloyd Hsieh.
Clarifications and Risks
- Contract Clarification: The company clarified a media report regarding a fiber communication product purchase. The bid was awarded to Siemens Telecommunications Systems, not UTStarcom as previously reported.
- Shareholder Meeting: The Annual General Meeting will address the 2003 financial statements, earnings distribution, and amendments to the Articles of Incorporation.
Investor Verification Checklist
- Verify the final approval of the NT$4.5 per share cash dividend at the June 25, 2004, shareholder meeting.
- Confirm the accuracy of the 2004 financial forecast (NT$41.6 billion net income) against actual quarterly results as they are released.
- Monitor the execution of the Siemens Telecommunications Systems contract for fiber communication products.
- Review the outcome of the proposed amendments to the Articles of Incorporation and Board election results.