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/ China Communications Services Corporation Limited
Management’s Discussion and Analysis of Financial
Conditions and Results of Operations
Overview
In 2011, the Group put more efforts in executing its customer-oriented service innovation strategy and allocated
resources deliberately in an increasingly competitive market. By capturing the opportunity of increasing capital
expenditure by domestic telecommunications operators and vigorously expanding businesses in the domestic non-
operator market and overseas market, the Group maintained rapid growth momentum in all businesses. Our total
revenues amounted to RMB53,507.40 million, representing an increase of 17.8% from 2010. Profit attributable to
equity shareholders of the Company amounted to RMB2,114.86 million, representing an increase of 17.2% from
RMB1,803.75 million
(1)
of 2010. Basic earnings per share was RMB0.366, representing an increase of 17.2% from
2010. Free cash flow amounted to RMB413.87 million, representing a decrease of 34.1% over the same period last
year.
Revenues
Our total revenues in 2011 were RMB53,507.40 million, representing an increase of 17.8% from 2010. Among
our businesses, revenues from telecommunications infrastructure (“TIS”) services were RMB25,114.96 million,
representing an increase of 16.1% from 2010; revenues from business process outsourcing (“BPO”) services were
RMB22,315.34 million, representing an increase of 20.6% from 2010; revenues from applications, content and other
(“ACO”) services were RMB6,077.10 million, representing an increase of 15.3% from 2010. BPO services were the
major source of our revenues growth in 2011, while network maintenance and distribution of telecommunications
services and products in BPO services were the two major businesses which experienced a relatively faster growth
in revenues. In terms of customer structure, the Group’s revenues from the domestic telecommunications operators
amounted to RMB34,151.06 million, representing 63.8% of the total revenues, an increase of 15.9% from 2010;
revenues from the domestic non-operator customers and overseas customers amounted to RMB19,356.34 million
and its proportion of total revenues increased to 36.2%, representing an increase of 21.3% from 2010. Domestic
telecommunications operators were the major driving force of the Group’s revenues growth in 2011.
(1)
In 2011, the Group retrospectively adopted the amendment to IFRS 1. Please refer to note 3 of the audited financial
statements for details.