Taiwan's top telecommunications firm, Chunghwa Telecom Co Ltd said on August 31 that it expects 2006 revenues to edge up from last year amid intense competition in the island's saturated telecoms market.
Chunghwa President Lu Shyue-ching told an investor conference that the company's sales would rise one to two percent this year. The news comes after Chunghwa last month posted an 8.6 percent fall in first-half profit.
The sales forecast came after the market closed in Taipei on Thursday, when Chunghwa shares fell 0.18 percent to T$54.00. Taiwan's main TAIEX share index gained 0.37 percent.
Chunghwa Telecom said last week it would sell up to 750 million shares overseas, or about 7 percent of its outstanding shares, in late September or early October.
"Now we are not positive that the share sale would take place in late September, but we will try to aim for that time," said Chunghwa Telecom Chairman Tan Ho-chen.
The Ministry of Transportation and Communication is selling a 7.4 percent stake, while Taiwan Mobile Co is selling another 1 percent, and the total offering size would be worth around $1.46 billion at its current market value.
Chunghwa had aimed to sell the shares before August 10, when the company goes ex-dividend. But the government had decided to adhere to a 28-day procurement process for picking underwriters, which would delay the process and force buyers to miss out on a 7 to 8 percent dividend, said one person familiar with the matter.
Chunghwa offered investment banks, including Morgan Stanley, Merrill Lynch, Citigroup Inc and J.P. Morgan a chance to handle the sale last month, sources said.
An estimated 86 percent of Taiwan's 23 million population already own mobile subscriptions, leading to stiff competition and low margins as carriers fight for customers, analysts say.
Taiwan's telecoms market is split between Chunghwa Telecom, Far EasTone Telecommunications Co Ltd and Taiwan Mobile Co.
Taiwan Mobile had said it expected sales to fall 2 percent in the third quarter from a year earlier, with operating profit falling by 7 percent, partly as the company migrates to advanced third-generation (3G) network which will increase costs.
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