China Tower Aktie

Present at today's event, we have the following management team: Mr. Zhang Zhiyong, Executive Director and Chairman of the company; Mr. Chen Li, Executive Director and General Manager of the company; Mr. Yin Wenkai, Executive Director; and our Chief Accountant, Mr. Hu Shaofeng.

Today's event will be divided into two parts. Firstly, the management team will give you a presentation on the overall operating performance of the company, and we are going to have the Q&A session.

Now first of all, I'm going to give the floor to our Chairman, Mr. Zhang Zhiyong, to tell you the overall performance of the company in the first half of the year of 2026. Thank you.

Ladies and gentlemen, good afternoon. Welcome to China Tower's 2026 Interim Results Announcement. Here, I'd like to express our gratitude to you for your long-term support and interest in China Tower. Today's presentation will be divided into three parts. First, I will report on the company's overall performance for the first half of 2026. Mr. Chen Li and Mr. Hu Shaofeng will then walk you through the business performance and financial performance, respectively. Lastly, we will take your questions during the Q&A session.

The PPT has already been uploaded to the official website of the company at noon. For the first half of the year, the highlights of the company's performance are mainly reflected in the following four aspects. First, net profit increased by 30.1% year-on-year. Second, revenue contribution from the Two Wings business increased to 16.3%. Third, we've made remarkable progress in the commercialization of technological achievements. Fourth, interim dividend increased by 44.3% year-on-year due to our very proactive dividend policy.

You can have a clearer idea of all these indicators on this slide. In terms of key indicators, the company recorded operating revenue of RMB 48.69 billion in the first half, down by 1.8% year-on-year. Net profit was RMB 7.49 billion, up 30% year-on-year. Operating cash flow amounted to RMB 7.14 billion. As at the end of June 2026, number of sites was 2.172 million, up by 2.5% year-on-year. Number of tenants reached 3.871 million, up by 0.7% year-on-year. The tower tenancy ratio stood at 1.78 tenants per site.

In the first half, the company actively seized the development opportunities brought by the strategies of Cyberpower, Digital China and Dual Carbon. Revenue from the TSP business reached RMB 40.36 billion, accounting for 82.9% of total revenue, as you can see from this pie chart and the bar chart. Revenue from the Two Wings business was RMB 7.92 billion, up by 14.2% year-on-year, with its share of total revenue further increasing to 16.3%. The One Core and Two Wings strategy continued to deepen.

For the TSP business, the company further implemented a national dual gigabit network joint entry campaign. In the first half of the year, revenue from the TSP business amounted to RMB 40.36 billion, down by 5% year-on-year, specifically driven by customers' network deployment, optimization adjustments, simplified base station upgrades and the continued developments of the 4G single network for China Telecom and China Unicom.

Revenue from our Tower business amounted to RMB 35.26 billion. So there is a decrease of 6.7% in our Tower business. Revenue from our DAS business amounted to RMB 5.09 billion, up by 9.2% year-on-year. So if we add these 2 together, we have a 5% decrease in terms of TSP business year-on-year. We're going to talk about this later.

And I'd say the impact is just temporary. Regarding the Smart Tower business, the company continued to cultivate key industries and key scenarios, supporting national strategies and major projects while steadily building growth momentum.

First, digital governance was strengthened. Second, the company continued to build innovative business models with strengthened product R&D, accelerated the development of low-altitude economy business and foster new growth drivers.

Third, overall capabilities were enhanced. The company strengthened the resource sharing capabilities of its nationwide distributed platform and developed large models across seven industry segments. And we try to empower the digital governance of our customers. Fourth, we consolidated the foundation for development.

The company enhanced product iteration development, strengthened the development of localized technical support teams and built a full chain network and information security system. In the first half, the Smart Tower business recorded revenue of RMB 5.33 billion, up 12.8% year-on-year.

As for the energy business, the company focused on its core businesses such as battery exchange and power backup and enhanced its market competitiveness by leveraging its key strengths in products, services and platforms.

First, the company accelerated product iteration and enhanced the performance of battery exchange and charging products, optimized the standardized power backup product metrics and promoted the application of integrated solutions.

Second, the company strengthened refined operations. It optimized the battery scheduling and recovery of degraded batteries, continued to enrich service options and improve user experience.

Third, the company promoted platform upgrades. It optimized the online marketing and asset management modules for battery exchange and charging, strengthened support capabilities, such as independent customer acquisition and intelligent scheduling and iterated and upgraded the energy butler platform to support the expansion of various integrated energy application scenarios in hospitals, campuses and others.

Fourth, the company enhanced its service capabilities. It upgraded its intelligent customer service, enhanced the customer service perception mass market, and continuously improve customer satisfaction. In the first half, the energy business generated revenue of RMB 2.59 billion, up 17.3% year-on-year. In the first half of the year, the company continued to deepen reform to improve quality and efficiency, fully unleashed its organic growth potential and consolidated the foundation for high-quality development.

First, we focus on optimizing the business layout. The company leveraged its resources strength in location plus computing plus power plus security to actively explore emerging businesses such as low-altitude economy and edge computing.

It improved the One Core and Two Wings entire product life cycle management system, strengthened the deep integration of technological innovation and business operations, enhanced product iteration development and supply capabilities and increased the supply of high-quality products.

Second, it strengthened frontline regional development. The resource support -- the company continuing to improve tiered management and resource support empower regional operations.

Third, it improved operational management efficiency. The company promoted the implementation of the One Core and Two Wings business system for large-scale construction and maintenance and realized intensive operation management, expanded One Code for All Applications, promoted intelligent operations and maintenance to achieve lean asset management. It also focused on key scenarios such as construction, maintenance and billing and revenue generation and strengthened the comprehensive coverage of AI+ to accelerate the digital intelligent transformation of production operations.

In the first half of the year, the company centered its efforts on the One Core and Two Wings business areas, concentrating achieving breakthroughs in technologies, accelerating the commercialization of research outcomes, and empowering the development of new quality productive forces, thereby delivering significant results in technological innovation.

First, we achieved breakthroughs in core technologies with a focus on next-generation mobile communication, AI and low-altitude economy. The number of granted patents increased by 132% year-on-year. Two new international standards were approved for project initiations. One of the projects won the second prize of the State Science and Technology Progress Award. Altogether, 133 awards were given out, and we got one of them.

Second, we accelerated the commercialization of our research outcomes and achieved the large-scale application of innovative products such as the new 5G leaky Coaxial cables, the Tower monitoring platform, and mid-high Point Video AI Algorithm and integrated energy service platforms. The Monitoring Spatial governance Data Set was selected as an outstanding achievement in the high-quality data sets for industrial applications from SOEs, while the Digital Intelligence and IoT Comprehensive Governance Scenario was selected as a strategic high-value AI application scenario for SOEs.

Third, we accelerated the upgrading of the innovation system. The company continued to advance the high-quality development of the 6 scientific technological innovation centers and actively participated in the development of Key Labs, Innovation Consortium and Consortium for the industrialization of technological achievements.

The company has always attached great importance to shareholders' returns maintained an active dividend policy and remained committed to sharing the benefits of its business development with all shareholders. So the Board of Directors has decided to distribute an interim dividend of RMB 0.19122 per share before tax, representing a year-on-year increase of 44.3%.

The cash flow was temporarily under pressure in the first half of the year. With our continuous effort, the situation is going to improve in the second half of the year. And that is why we are able to achieve a 44% increase in our dividend payout. In the future, the company will actively enhance corporate value and continue to deliver greater returns to all shareholders.

The company placed great emphasis on sustainable development and actively fulfill ESG responsibilities.

Firstly, we implemented green development. We coordinated advanced the co-building and co-sharing of digital infrastructure and expanded the application of clean energy such as PV at base stations. We also deepened the application of digital intelligence technologies.

Second, we strengthened our sense of responsibility. We improved network coverage in rural remote areas. And we provided emergency communication support for disaster prevention, response and relief. And safeguarding smooth rescue operation on-site command and communication security.

Third, we improved our corporate governance. We strictly complied with listing regulations and consistently maintain a high standard of corporate governance. We are committed to advancing the development of legal and operational compliance management systems and enhanced early risk warning and prevention capabilities. We also continue to improve the quality of our information disclosure, strengthen communication engagement with the capital markets and improve the transparency of the listed company.

Going forward, the company will remain committed to its One Core and Two Wings positioning focused on enhancing its core capabilities, raising our core competitiveness continue to deepen resource sharing, improve operational efficiency and create greater value for shareholders, customers and societies because China Tower is based on sharing. So that's where we're going to work on in the future.

On the TSP business front, the expansion of 5G and 5G coverage in both breadth and depth continued. We will fully capitalize on the development opportunities brought by national policies, including the upgrade the signal strength, expanding broadband coverage to border areas, forest and grasslands and upgrading saving action plan for 5G applications and high-quality urban development. The super position of national policies such as the construction of Six Networks brings broad opportunities for the company. The company will seize these opportunities to fully meet customer demands and help consolidate and enhance the competitive advantage and leading position of the telecom industry.

As for the Two Wings business, we will actively support digital intelligence governance and the transformation to green low-carbon development. We will continue to strengthen product innovation and optimize our business layout to drive the sustained and rapid development of the Two Wings business. And that wraps up my part.

Next, Mr. Chen Li, our General Manager, will present the details of the company's business performance. Thank you.

Thank you, Chairman. I will now present the company's operational performance for the first half of the year. This table outlines the revenue of our businesses and the relevant changes as well as the key operating data, which I will elaborate on. Regarding the Tower business, first, we provided embedded services that fully integrate with TSP's network planning, focusing on key scenarios such as capacity expansion and hotspot coverage enhancement in urban areas as well as broad rural coverage to support extensive and deep 5G network coverage.

Second, we proactively conducted coverage analysis, enhanced network optimization capabilities focused on solving customers' urgent and pressing concerns, leveraged our strength in resource coordination, tackled difficult site selection issues and strive to improve construction delivery efficiency.

Third, we improved support for the needs of key industries by fully implementing an integrated resources plus demand coordination approach and actively capturing the network coverage demand from key industries such as culture and tourism, education and transportation. In the first half of the year, the company constructed 187,000 5G base stations during the period, bringing the cumulative total to 3.31 million base stations with over 95% of 5G stations being built through the sharing existing sites. At the end of June, the number of TSP tenants stood at 3.565 million and the TSP tower tenancy ratio was 1.69.

As for the DAS business, First, we strengthened coordination with major project construction, accelerated demand acquisition, leveraged our advantages of coordinated site entry, promoted the implementation of mandatory regulations for telecom infrastructure acceptance and enhanced market service support.

Second, we stepped up innovation in DAS technologies, products and solutions, strengthened the implementation of new products and solutions such as active and passive DAS integration and shared model repeaters to unlock additional growth opportunities in DAS market.

Third, we focus on launches special campaigns targeting coverage elevators and underground parking garages as well as 5G upgrades for high-speed railways. We utilize shared low-power repeaters to reduce investment in signal resources and transmission infrastructure. While continuously improving the level of professional services. In the first half of the year, revenue from the DAS business reached RMB 5.09 billion, representing a year-on-year increase of 9.2%. A total of 1.02 billion square meters of building floor areas was added, bringing the total coverage to 16.17 billion square meters. We also added 2,450 kilometers of coverage in subways and railway tunnels with total coverage reaching 36,111 kilometers. The scale of the DAS business continued to expand.

Regarding the Smart Tower business, the company focuses on special digital intelligence governance and continues to deepen its presence in key industries and scenarios. More than 260,000 digital towers are widely serving over 10 industries, including land resources, emergency response water conservancy and environmental protection with market share steadily increasing in key areas such as on Straw burning provision, Farmland protection, Disaster alert.

In the first half of the year, Smart Tower business maintained its growth momentum. Revenue from the monitoring business reached RMB 3.2 billion, representing a year-on-year increase of 13.5% (sic) [ 13.4% ] and accounting for 60% of the Smart Tower business revenue. Revenue from the sharing business reached RMB 2.13 billion, representing a year-on-year increase of 12.1% (sic) [ 12.0% ]. In the first half of the year, the company will leverage its advantages in mid- and high point site resources and continue to strengthen the operating capabilities of the Smart Tower business.

In terms of the platform capabilities, we strengthened nationwide platform sharing, established a tiered platform architecture system and developed flexible support capabilities for multiple scenarios and differentiated needs. Enabling rapid and precise adaptation to customers' needs. In terms of algorithm capability, we leverage the data advantages of our sample library of more than 1.1 billion mid-to high point samples to improve the efficiency of algorithm R&D iteration, thereby continuously consolidate our competitive edge in this area.

In terms of product capabilities, we continue to deepen our capabilities in industry application and proactively explore new business products. In terms of service capabilities, we implemented a major infrastructure framework to enhance delivery capabilities. In terms of innovation capabilities, we deepened the commercialization of large models and intelligent agents and fully unleashed innovation momentum by leveraging the nation innovation platform for industry-education integration post doctoral workshops.

As for the development of the battery exchange business, first, the company continued to strengthen user operations and enhance the user experience through measures such as expanding the VIP user base, enriching user rights and benefits, resulting in a further expansion of the customer base for its battery exchange and charging business. As of 30th June 2026, the company had 1.493 million battery exchange users, further consolidating its market leadership.

Second, the company accelerated network construction and continuously optimized the layout of the battery exchange and charging network and battery algorithms, effectively improving user convenience and expanding the user base. As of 30th June 2026, the company had launched battery exchange and charging services in more than 340 cities. Revenue from the battery exchange business reached RMB 1.6 billion in the first half of the year, up 20.6% year-on-year, maintaining sound growth momentum.

As for the power backup business, the company continued to strengthen product promotion by launching multiple high-performance power supply security products for key scenarios. It developed multiple PV and energy consumption management products to meet customers' needs for power supply security, carbon reduction and energy conservation. The company continued to enhance service support by strengthening the development of the companion service system for corporate customers and continuously improving capabilities in demand response, project delivery and maintenance support.

The company also continued to advance platform upgrades by iterating and upgrading application modules for various scenarios to address customers' diverse needs, enhancing digital operational capabilities and promoting visualization and refine control throughout the entire process. In the first half of the year, revenue from the power backup business reached RMB 1 billion, up 12.4% year-on-year, continuing its robust growth momentum.

Next, Mr. Hu Shaofeng will present the financial performance for the first half of the year. Thank you.

Thank you, Mr. Li. This table shows our key financial indicator for the first half of 2026. In the first half of the year, the company maintained stable overall performance, effectively managed cost and expenses, further improved profitability and sustained a sound capital structure.

In the first half of the year, operating expenses totaled RMB 37.58 billion, down 8.3% year-on-year. The operating expense accounted for 77.2% of operating revenue, down 5.4% year-on-year. In terms of depreciation and amortization, it amounted to RMB 19.14 billion in the first half of the year, down 25.2% year-on-year or RMB 6.46 billion. This was primarily due to the expiration of the depreciation period for the acquired tower assets and adjustment to the depreciation period for DAS assets.

In terms of repairs and maintenance expenses, it totaled RMB 3.79 billion, up 19% year-on-year or RMB 600 million. This was mainly due to the company's continued strengthening of special rectifications for identifying and addressing potential asset risks. Employee benefits and expenses totaled RMB 4.84 billion in the first half of the year, up 1.6% year-on-year or RMB 80 million. This was due to the company's efforts to advance R&D innovation and regional management reform. Sites operation and support expenses totaled RMB 2.89 billion in the first half of the year, representing a year-on-year increase of 14% or RMB 350 million. This was mainly due to the company's accelerated development of site operations and digital capabilities and others. Other operating expenses totaled RMB 6.92 billion, up 41.6% year-on-year or RMB 2.03 billion. This is mainly due to various increase in our marketing expenses and costs related to integrating services increased by RMB 810 million and the provision for bad debt increased by RMB 514 million year-on-year.

In the first half of the year, the company recorded operating profit of RMB 11.111 billion. Net profit attributable to owners of the company was RMB 7.49 billion, up 30.1% year-on-year. EBITDA for the first half of the year was RMB 30.25 billion, down 11.6% year-on-year, mainly due to lease terminations resulting from the network optimization adjustment by TSP customers, the impact of utra lean site upgrades and the increase in maintenance expense related to the service life expansion -- extension of Tower assets.

The company made effective investments in line with its business development and building needs. Capital expenditure for the first half year was RMB 11.65 billion, down 6% year-on-year or RMB 740 million. CapEx for new site construction and augmentation totaled RMB 6.49 billion, down 1.7% year-on-year. CapEx on site replacement improvement amounted to RMB 2.09 billion (sic) [ RMB 2.07 billion ], down 12.2% year-on-year. CapEx on IT support and purchase of comprehensive product facilities amounted to RMB 450 million, down RMB 490 million. CapEx for the Two Wings business totaled RMB 2.62 billion, up 6% year-on-year.

Cash flow was temporarily under pressure for the first half of the year. Operating cash flow was RMB 7.14 billion, down RMB 21.54 billion year-on-year. This was mainly attributable to longer customer payment cycles and increase in collections settled by bills. Free cash flow for the first half of the year was negative RMB 4.52 billion.

As of the 30th of June 2026, the company's Total assets stood at RMB 351.24 billion. Total liabilities amounted to RMB 145.53 billion, which RMB 94.74 billion was net debt. The company's liability-to-asset ratio was 41.4%. The company will continue to deepen its One Core and Two Wings strategy, building its professional, intensive, dedicate, efficient, and digitalized operating system. It will also strengthen effective investment, enhance its lean management capabilities and drive continuous improvements in operational efficiency and effectiveness to drive the sustainable and healthy growth of the company and create greater value for shareholders.

Thank you.

[Statements in English on this transcript were

Spoken by an interpreter present on the live call.]

So present at today's event, we have the following management team, Mr. Zhiyong Zhang, Executive Director and Chairman of the company. Mr. Li Chen, Executive Director and General Manager; and Mr. Shaofeng Hu, Chief Accountant of the company. Today's presentation is divided into two parts. Firstly, the management team is going to present on the performance of the company for the year 2025, and then we're going to have the Q&A session.

Now we're going to give the floor to Chairman, and he's going to present you on the overall performance of the company for the year 2025.

Ladies and gentlemen, welcome to the 2025 annual results announcement of China Tower. And I'd like to take this opportunity to thank you for your ongoing support and interest in our company. Today's presentation is divided into three parts: First, I'm going to talk about the overall performance of the company; and then we are going to look at the business performance and financial performance of the company. I will be firstly present to you about the overall performance of the company for 2025. And then General Manager, Mr. Li Chen, and Chief Accountant, Mr. Shaofeng Hu, are going to talk about business performance and financial performance. And finally, we are going to answer your questions together.

For last year, through our efforts we have the following highlights for the company's performance. Firstly, the overall operational performance remained robust, with net profit increasing 8.4% year-on-year. Secondly, a multi-pillar development structure has taken shape with revenue from the Two Wings business increasing to 14.9%. Thirdly, we actively served digital governance with 252,000 digital towers serving thousands of industries. Fourthly, we continue to enhance technological innovation with R&D expenses increasing by 80.2% year-on-year. Fifthly, we placed strong emphasis in shareholders' returns with a full year dividend payout ratio rising to 77%.

In terms of key indicators, we have a chart here. As you can see, the overall performance is very good. The company recorded operating revenue of RMB 100.4 billion, up 2.7% year-on-year and 3.1% on a comparable basis. That's to consider the differences in electricity or energy price. Net profit was RMB 11.63 billion, up 8.4% year-on-year, EBITDA totaled RMB 65.81 billion, down 1.1% year-on-year due to increase in talent termination orders resulting from the integration of networks, the growth rate of the number of talents has slowed down. As of the end of 2025, the number of talents reached 3.856 million with the tower tenancy ratio of 1.79, slightly lower than that of last year.

The company's cash flow remained sound in 2025. Net cash flow generated from operating activities for the year was RMB 56.12 billion, up RMB 6.65 billion year-on-year. Free cash flow was RMB 26.63 billion, up RMB 9.1 billion year-on-year. In 2025, the company continued to seize the opportunities arising from the Separate China and Digital China initiatives and the dual carbon goals.

All business segments performed in line with expectations, achieved a steady overall growth as you can see from the chart. For our GSP business, its revenue reached RMB 84.73 billion, accounting for 84.4% of total revenue. Revenue from the Two Wings business was RMB 14.99 billion. That's close to RMB 15 billion, up 11.9% year-on-year growth of 14.9% on a comparable basis, accounting for 14.9% of total revenue. The One Core and Two Wings strategy continued to solidify. Regarding the TSP business, the company continues to strengthen its new 5G telecommunication infrastructure and implemented specialized projects such as the signals upgrades and the extension of broadband coverage to all border areas and forests.

As a result, TSP business remained stable. For Tower business, capitalizing our clients' ongoing network expansion and leveraging its competitiveness strengths of efficient delivery, superior maintenance and optimal cost structure while minimizing management risks. The company built 364,000 5G stations during the year. bringing the total to 3.123 million. More than 95% of 5G projects were delivered through site colocation, helping operators effectively deploy and centralize the 5G network.

For DAS business, the focus was on high value and livelihood scenarios while strengthening capabilities in resource coordination and sharing and collaborative construction. In 2025, a total of 2.47 billion square meters of building floor areas was added, bringing the total coverage to 15.15 billion square meters.

We also added 4,346 kilometers of coverage subways and railway tunnels with total coverage reaching 33,661 kilometers. Total coverage continued to expand steadily. Regarding Smart Tower business, the company has firmly established itself in special digital intelligence governance field, leverages rich resources and capabilities. It continued to perform well in Smart Tower business with revenue exceeding RMB 10 billion. First, we continue to deepen key industries and scenarios and steadily increase our market share in key areas such as straw burning, farmland protection and disaster alerts.

Secondly, we continue to advance our nationwide one single network for the distributed platform and promoted the application and implementation of large models for special governance industries in key scenarios, thereby enhancing the competitiveness of industry products. Thirdly, we continue to develop high standard service systems and reinforced unified local support and service teams to ensure a swift response to customers' reiterative development requirements and continuously enhance our companion service capabilities.

Fourthly, we deepened the closed-loop management of network information security risks and carried out special initiatives to comprehensively enhance technical protection capabilities for network information security across terminals, cloud networks, platforms and data. In 2025, the Smart Power business maintained rapid growth with revenue reaching RMB 10.17 billion, up 14.2% year-on-year. In the Energy business, the company focused on cooperation such as battery exchange and power backup, enhanced refined operation capabilities, strengthened core competencies in products, services and platforms and continue to develop the energy business in a professional manner.

Firstly, in terms of product and upgrades and iterations, we completed functional enhancements for battery exchange products, continue to improve the overall performance of the battery exchange systems, enriched a standardized product system for power backup and promoted China Tower's comprehensive energy butler industry solution.

Secondly, we strengthened platform support, we enriched intelligent analysis models comprehensively upgraded the core functions of the energy butler platform and improve the platform support capabilities. Thirdly, we deepened refined operations. We strengthened asset management across the entire life cycle, conducted impact analysis of asset value and improved asset utilization efficiency. We also enhanced the VIP user operation system to improve the ability to manage user segmentation. Fourthly, we optimize services, we strengthened the development of C-end intelligent customer service, optimize the B-end companion service system and continue to improve service satisfaction. The Energy business achieved revenue of RMB 4.81 billion for the full year, a 7.5% increase year-on-year, a 16.5% increase year-on-year on a comparable basis with development momentum continuing to strengthen.

In 2025, the company strengthened to deepen reforms and improvements, injecting new impetus to the high-quality development of our business. Firstly, we accelerated the deployment of the strategic layout in emerging industries, actively promoted the implementation of the 100 major projects, strengthened the integrated support of industry plus technology plus talent, accelerated the commercialization of technological achievements and actively explore new sectors such as low-altitude economy and edge computing.

Secondly, we shifted resources to the frontline regions, implemented tier management and targeted policies and improved the valuation incentive mechanisms, foster an atmosphere of competitive excellence. We enhanced efficiency and prevented risks through lean management, promoted integration empowerment through digital intelligence transformation and optimize systems and capabilities through intensified operation. The company continued to strengthen its research on key technologies, accelerated the transformation of scientific and technological achievements and stepped up efforts in scientific and technology innovation.

First, we focus on R&D breakthroughs in key areas, including next-generation mobile communications, AI, low-altitude economy and edge computing networks. The number of invention patents offer us through the year increased by 50.4% year-on-year. Second, we focused on the commercialization of achievements and promoted the large-scale application of innovative products, such as shared micro repeaters, edge gateways and the One Core for All Solution. Thirdly, We're focused on refining the innovation system. The 6 scientific and technological innovation centers achieved through high-quality development while high-level platforms such as post-doctoral workstations and joint innovation centers were upgraded and expanded. The Company participated in the formulation of 9 international standards and total 16 new technology awards at Provincial or ministerial level and above were received during the year, further strengthening our scientific and technological innovation system.

The company has always adhered to the philosophy of giving back to our shareholders, maintaining a proactive and stable dividend policy to share the fruits of its business development with all shareholders. The Board of Directors recommended a payment of a final dividend together with the already distributed interim dividend increased by 9.8% compared with last year, and full year dividend payout ratio rose to 77%.

In the future, the company will continue to strengthen our competitiveness, consolidated our development foundation and comprehensively enhanced operational quality, efficiency and profitability whilst driving to generate greater value for shareholders. The company has consistently promoted the deep integration of ESG into its operations, impending the philosophy of social responsibility throughout its entire development programs.

In terms of social responsibility, the company established a highly efficient emergency communication support system to fully ensure the smooth running of rescue operations, on-site command and communication security during emergency operations. We have supported natural infrastructure in rural remote areas, empowering rural revitalization through digitalization. We also built rider homes to foster a sense of community and convey cities care and warmth. In terms of green development, the company practiced shared green and low carbon operations, we vigorously promoted energy conservation and emission reduction at base stations and expanded the application of green energy, such as the use of PV and energy storage. We will also deepen the application of digital intelligence to empower ecological conservation, promote green travel, encourage convenient, low-carbon lifestyles.

In terms of the governance foundation, the company continuously enhanced its corporate governance standards and compliance management capabilities through our clearly defined governance mechanism, a sound compliance management system and a transparent information disclosure and investor communication. Looking ahead, the company will continue to uphold the philosophy of resource sharing and anchor its positioning as a 3 service provider. And you can find information on the slide and adhere to the One core, Two Wings strategy to continuously enhance core capabilities and core competitiveness.

In terms of the TSP business, we will seize the opportunities presented by signal upgrade and expansion of broadband coverage to all border areas and forest and grassland, the upgrade of saving action plan as well as high-quality urban development strategy centered on innovation resilience and Smart have brought vast development opportunities, reinforce our competitiveness as a service provider offering efficient delivery, superior maintenance and optimal cost structure while minimizing management risks to realize stable development. As for the Two Wings business, the company will deepen the development of core resources and expand the development of new markets such as low attitude economy, edge computing, battery charging and exchange and PV energy storage. This will help to nurture, enhance capabilities of demand acquisition.

Now I'm going to give the floor to Mr. Chen Li, who is going to talk about the business performance of the company.

Thank you, Mr. Chairman. Now I'm going to report to you the business development of the company. As you can see from the slide, the company's various business performed very well. Now I'm going to provide you with further explanation. In 2025, the company's various business performed very well and that multi-pillar revenue growth pattern continues to take shape. Operating revenue reached RMB 100.41 billion, representing a year-on-year increase of 2.7% and a growth of 3.1% on a comparable basis.

In terms of growth structure, the TSP business maintained sound development, thanks to the decrease of lower site fees, power generation costs and other social expenses, together with the impact from the increase in talent termination orders resulting from the integration of networks, revenue from the Tower business recorded a slight decrease.

The DAS business developed rapidly with an incremental contribution of 26.7%, representing an increase of 0.8 percentage points. The incremental revenue contribution from Two Wings business reached 65.1% of which the Smart Tower business contributed 42.3% driving revenue growth by 1.3 percentage points. The incremental revenue contribution from the energy business was 22.8%, a growth of 0.7 percentage points.

Next, I'm going to provide a detailed overview of the development of our key businesses. Regarding the tower business, the company focused on addressing customers' needs. Firstly, we fully implemented embedded service mechanisms to continuously meet customers' demands for in-depth and broad coverage. Secondly, we enhanced network optimization capabilities, strengthened collaboration with TSPs and precise planning and construction to better serve customers. Thirdly, we adhere to a customer-oriented philosophy, the needs of network coverage in culture and tourism, education, transportation, other sectors and constantly optimized business processes and management, comprehensively enhance the capabilities in demand acquisition, resource coordination and sharing customer service.

And revenue from the tower business reached RMB 75.5 billion. As of the end of 2025, the number of TSP talents reached 3.567 million, up 0.6% year-on-year. The TPS tenancy ratio was 1.7, maintaining steady overall development. As for the DAS business, we leveraged the integrated resources plus demand development model to continuously solidify our competitiveness as a service provider. We did this by offering efficient delivery, superior maintenance and optimal cost structure while minimizing management risks and actively expanding the DAS market.

We deeply cultivated the niche market seizing opportunities from the signal upgrade initiative to focus on the coverage of DAS business. We also collaboratively advance special projects such as elevators, underground parking lots and 5G network upgrades on high-speed railways. At the same time, we strengthened our innovation leadership by driving innovation in active+passive products striving to enhance the market competitiveness of [indiscernible] type products and solutions. We also leveraged a series of innovative products as shared micropower repeaters and 5G spread-spectrum leaky coaxial cables.

And revenue from the DAS business totaled RMB 9.23 billion, a year-on-year increase of 9.5%. Regarding the Smart Tower business, we have our [indiscernible] in the field of special digital governance, leverage outreach resources and capabilities, we continue to deeply cultivate key industries and scenarios, upgrading 252,000 telecommunication towers to digital towers steadily increased our market share in areas such as straw burning bans, farmland protection and disaster alerts. In 2025, the Smart Tower business maintained rapid growth. Revenue from the tower monitoring business reached RMB 6.33 billion, a year-on-year increase of 14.3%, accounting for 62.2% of total revenue from the Smart Tower business.

Revenue from the Tower Sharing business reached RMB 3.84 billion, up 14% year-on-year, accounting for 37.8% of the total Smart Tower revenue. In developing Smart Tower business, the company leveraged its mid-to-high point set resources to continuously advance 5 core competencies. Firstly, we deepened the operational capabilities of distributed platform, strengthened the collaborative platform service responded quickly and precisely to customer needs and enhance service value.

Secondly, we continuously consolidate the advantages of mid- to high point algorithms, utilizing our library of 900 million mid-to-high point samples. We strive to achieve greater algorithm, accuracy, faster R&D iteration and broader service scenarios. Thirdly, we have constantly improved product capabilities by establishing a nationwide integrated R&D iteration system, 15 specialized industry applications now cover over 30 business scenarios, ensuring efficient sharing of product capabilities.

Fourthly, we continuously enhance service capabilities. We implemented the major infrastructure system to strengthen project delivery, deepened professional operations and maintenance and reinforced network management platform to ensure high-quality operation of clients' businesses. Fifthly, we continue to strengthen our innovation capabilities, which drove technological breakthroughs in key fields to promote the commercialization of large models and leveraged the national postdoctoral research workstation to enhance our innovation capacity. Regarding the development of the battery exchange business, the company continues to deepen user operation strategies while improving operational levels across product, services, benefits and marketing.

For example, we increased the allocation ratio of 0.0 battery exchange products, focus on R&D for next-generation 5.0 exchange products in areas such as battery lifespan and discharge performance centered on customer satisfaction and constructed a full process smart service system to elevate user experience.

We accelerated the construction of community charging infrastructure networks to expand the scale of the user base. Through these measures, we effectively elevated the user experience and customer satisfaction, boosted user stickiness and maintained steady growth in the number of battery exchange users throughout the year.

As of December 31, 2025, China Tower had approximately 1.477 million battery exchange users, an increase of 173,000 from the end of the previous year, further solidifying its leading position in the low-speed electric vehicle battery exchange markets. The battery exchange business recorded revenue of RMB 3.03 billion for the year, up 22.4% year-on-year on a comparable basis, maintaining its market-leading position. Regarding the development of the power backup business, First, we delay cultivated key industries by developing standardized products for typical scenarios and enabling one-stop access to an advanced R&D innovation and regional management reforms, the company recruited additional mid- and senior level scientific and technical talent, original management personnel, while strengthening performance-linked incentives to boost its development momentum.

Second, we upgraded the service model of China Tower's Energy Butler platform to enrich various industry application scenarios and meet customers' needs for power supply security, carbon reduction, energy conservation and carbon reduction. Third, we optimized the company service system, leverage outlook maintenance capabilities to improve rapid response capabilities. The revenue from power backup totaled RMB 1.78 billion for the year, up 7.7%.

Now Mr. Shaofeng Hu will present the company's financial performance for 2025.

Thank you, Mr. Li Chen. Now I'm going to talk about the key financial performance for 2025. The table shows our key financial indicators for 2025. In 2025, the company's overall performance was sound. Revenue grew steadily. Profitability continued to improve, cash flow improved gradually, and the robust capital structure was maintained. In 2025, the company implemented special projects to reduce costs and increase efficiency.

We strictly manage the income to expenditure ratio, prioritizing production, expenditure directly related to the expansion of the One Core and Two Wings business. Reasonable measures were taken to expand the lifespan of aging assets and maintain the sustained a healthy operation of assets. In 2025, operating expenses totaled RMB 83.05 billion, up 2% year-on-year.

The operating expense revenue ratio was 82.7%, down 0.6% year-on-year, depreciation and amortization expenses totaled RMB 48.45 billion down 3.5% year-on-year, mainly due to the adjustment of depreciation period for DAS assets and the expiration of depreciation for tower assets acquired to 2015. Repair and maintenance expenses totaled RMB 7.10 billion, up 1.6% year-on-year as the tower assets acquired by the company gradually expire, it is reasonable extending the lives of the aging assets, strengthening safety hazards inspection and rectification for assets and continuously promoting the construction application of intelligent operation and maintenance functions.

In terms of employee and benefits expenses, it totaled RMB 10.08 billion, up 5.3% year-on-year. To advance R&D innovation and regional management reforms, the company recruited additional mid- and senior level scientific and technical talent and regional management personnel, while strength in the performance-linked incentives to boost this development momentum.

Site operation and support expenses totaled RMB 6.13 billion, up 11.3% or RMB 620 million year-on-year. The company accelerates the development of site operations and digital capabilities resulting in a year-on-year increase of RMB 760 million in costs and IT support expenses related to site operations.

Other operating expenses totaled RMB 11.29 billion, up 23.5% or RMB 2.15 billion year-on-year. Business development expenses increased by RMB 1.08 billion, primarily due to increased expenditure on localized technical support services and marketing costs to support the development of the Two Wings business and advanced the construction of companion services systems and platform operation management capabilities.

Other expenses increased by RMB 1.07 billion, mainly due to an increase in provisions for bad assets of approximately RMB 550 million based on a prudent approach as well as a decrease in net gains from asset disposals of approximately RMB 260 million.

In 2025, adherent to an efficiency-oriented approach, the company stepped up efforts benchmark costs of the individual sites and reduce expenses while increasing efficiency, thereby maintain stable profit growth. Operating profit reached RMB 17.36 billion in 2025, up 6.3% year-on-year. Net profit attributable to parent company reached RMB 11.63 billion, up 8.4% year-on-year. The company's EBITDA reached RMB 65.81 billion, down 1.1% year-on-year, mainly due to the company's reasonable extending the service life of each asset strengthen the building of digitalization capabilities, et cetera.

EBITDA accounted for 65.5% of operating revenue. In 2025, the company adhered to a total CapEx plus project link investment management model, aligning total investment aldication with the overall needs of business development and capacity building. It continues to improve the pre-assessment and post-evaluation of projects with CapEx totaling RMB 29.49 billion for the year, down 7.7% year-on-year.

CapEx for the new construction and augmentation totaled RMB 15.3 billion, down 15.8% year-on-year. This was primarily due to changes in operational demand as well as the company's ongoing optimization of construction plans and adoption of innovative products. CapEx for site replacement improvement reached RMB 5.47 billion, down 19.9% year-on-year.

This was mainly attributable to the company's focus on conducting safety hazard inspection and electrification and others. Capital expenditure for Smart Tower and energy facilities amounted to RMB 5.97 billion, up 24.8% year-on-year. This was mainly due to the company's efforts to adapt the development needs of the Two Wings business, accelerate the construction of a Smart Tower business platform and payment product iteration and upgrading. In 2025, the company accelerated advancing the collection of payments for the One Core and Two Wings business, the net cash flow from operating activities for the year amounted to RMB 56.12 billion, up RMB 6.65 billion year-on-year.

Free cash flow reached RMB 26.63 billion, up RMB 9.8 billion year-on-year. As of the end of 2025, the company's total assets stood at RMB 336.58 billion. Total liability was RMB 132.67 billion, of which RMB 78.15 billion was net debt. The company's liability to asset ratio was 39.4%, net gearing ratio was 27.7%. In 2026, the company will continue to deepen its One Core and Two Wings business strategy, building upon its professional intensive, dedicate efficient and digitized operating system. It will enhance its lean management capabilities and drive continuous improvement in operational efficiency and effectiveness to drive the sustainable and healthy growth of the company and create great value for shareholders. Thank you.