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/ China Communications Services Corporation Limited
Report of the Directors
The board of directors (the “Board”) of China Communications Services Corporation Limited (the “Company”) is
pleased to present the Report of the Directors of the Company, together with the audited financial statements of the
Company and its subsidiaries (the “Group”) prepared in accordance with International Financial Reporting Standards
for the year ended 31 December 2011.
Principal Businesses
The Group is a leading service provider in the PRC that provides integrated support services in the field of
informatization. We offer telecommunications infrastructure services, including design, construction and project
supervision and management; business process outsourcing services, including network maintenance, facilities
management and distribution of telecommunications services and products; applications, content and other services,
including IT applications, mobile Internet services and value-added voice services. The major customers of the Group
include domestic operators, domestic non-operator customers such as government agencies, telecommunications
equipment manufacturers and large enterprises, and overseas customers.
Results
Results of the Group for the year ended 31 December 2011 and the financial position of the Company and the Group
as at that date are set out in the audited financial statements on page 99 to page 174 in this annual report.
Dividends
The Board proposed a cash dividend of RMB0.1222 per share for the year ended 31 December 2011 based on
dividend payout ratio of 40% over the profit attributable to equity shareholders of the Company, and total dividend
amounted to approximately RMB846.36 million. The proposed dividends will be submitted for consideration and
approval at the 2011 annual general meeting to be held on 28 June 2012. The Company proposed to distribute the
dividends on the basis of the total share capital as at the close of trading on the record date for dividend distribution.
Dividends will be denominated and declared in RMB. Dividends of domestic shares will be paid in RMB, whereas
dividends of H shares will be paid in Hong Kong dollars. The relevant exchange rate will be the average of the mid-
point rates of RMB to Hong Kong dollars as announced by the People’s Bank of China for the week prior to the date
of approval of declaration of dividends at the 2011 annual general meeting.
Further details in respect of the dividends and distribution by the Company are set out in note 15 of the audited
financial statements on page 133 of this annual report.
For the overseas resident individual shareholders of the Company, pursuant to relevant laws and regulations
including the Law of the People’s Republ ic of China on Individual Income Tax, the Regulations for the
Implementation of the Law of the People’s Republic of China on Individual Income Tax, and the letter dated 28 June
2011 from the State Administration of Taxation to the Inland Revenue Department of Hong Kong, for individual H
share shareholders receiving dividends who are Hong Kong or Macau residents and whose country of domicile is
a country which has entered into a tax treaty with the PRC stipulating a dividend tax rate of 10%, the Company,
as a withholding agent, is required to withhold and pay individual income tax at the rate of 10%. For individual H
share shareholders receiving dividends whose country of domicile is a country which has entered into a tax treaty
with the PRC stipulating a dividend tax rate lower than 10%, the Company will withhold the individual income tax
at a rate of 10%. The Company can process applications on behalf of those shareholders to seek entitlement of the
relevant agreed preferential treatments pursuant to relevant regulations, and upon approval by the tax authorities,
the extra amount of tax withheld will be refunded. For individual H shareholders receiving dividends whose country
of domicile is a country which has entered into a tax treaty with the PRC stipulating a dividend tax rate higher than
10% but lower than 20%, the Company will withhold the individual income tax at the agreed-upon effective tax rate
when distributing dividends and no application procedures will be necessary. For individual H shareholders receiving
dividends whose country of domicile is a country which has not entered into any tax treaty with the PRC or are
under other situations, the Company will withhold the individual income tax at a tax rate of 20% when distributing
dividends.