China Tower Aktie

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.

Ladies and gentlemen, present at today's event are the management team, including Mr. Zhang Zhiyong, Chairman and Executive Director; Mr. Chen Li, Executive Director and General Manager; and Mr. Hu Shaofeng, Chief Accountant.

Today's event will be broken down to 2 parts. Firstly, there will be the presentation and then we're going to have the Q&A session. Firstly, we're going to invite Chairman, Mr. Zhang Zhiyong to brief you on our performance in the first half of 2025. Mr. Chair, the floor is yours.

Ladies and gentlemen, our press friends, good afternoon. Welcome, and thank you for coming here despite this very challenging weather today. Today, we have the interim results announcement of China Tower. And to ensure your safety and to encourage more investors to participate in today's announcement and discussion, we have opened up an online session as well.

Present at today's event are Mr. Chen Li and Mr. Hu Shaofeng as well. I'm going to break today's presentation to 3 parts. Firstly, I'm going to give you the overall performance of the company in the first half, to be followed by the business performance by Mr. Chen Li and the financial performance by Mr. Hu Shaofeng. And finally, we 3 are going to answer your questions. So let's take a look at the overall performance of the company.

The highlights of the company's performance for the first half were mainly reflected in the following 5 aspects. First, the company recorded sound operating performance with net profit increasing by 8% year-on-year. Second, sustained revenue growth supported by multiple pillars. The Two Wings business increased its contribution to 14% of total revenue. Third, upgrades in digital towers accelerated revenue of Smart Tower business and the revenue increased 18.7% year-on-year. Fourthly, we boosted the commercialization of research outcomes, steadily improved the efficiency of technological innovation. Fifthly, we shared the fruitful results with shareholders with interim dividend increasing by 21.6%.

In terms of key indicators, as you can see from the table, the company recorded operating revenue of RMB 49.6 billion, a 2.8% increase year-on-year. In view of the related regulation issued by the Ministry of Finance, the company has changed its recognition of electricity revenue in the battery recharge business from the gross method to the net method, recording a comparable growth of 3.1%. Net profit was RMB 5.76 billion, up 8% year-on-year. EBITDA totaled RMB 34.23 billion, up 3.6% year-on-year.

As at the end of June 2025, there were 3.844 million tenants with tower tenancy ratio at 1.81 and level of co-location was further enhanced. In the first half, the company's cash flow remained stable with net cash flow generated from operating activities reaching RMB 28.68 billion and free cash flow of RMB 16.29 billion.

The slide shows the overall structure of our business. In the first half, the company seized the opportunities brought by Cyberpower, Digital China and Dual Carbon goals and revenue from TSP business reached RMB 42.46 billion, accounting for 85.6% of the total revenue. Revenue from the Two Wings business was RMB 6.94 billion, up 15.5% year-on-year. Comparable growth was 18.4%. Its proportion of total revenue increased to 14%, up by 1.6%. So our One Core and Two Wings strategy continued to deepen and our revenue structure continued to improve.

Regarding our TSP business, the company sees the development opportunities brought by increased 5G network penetration and coverage and continue to improve resource coordination and sharing and enhanced professional operational capabilities to fully meet the network deployment needs of customers. TSP business was able to remain stable.

For Tower business, 215,000, 5G base stations were built in the first half, bringing the total to 2.974 million. More than 95% of the 5G projects were delivered through site co-location. For DAS business, it gave full play to the advantages to the advantages of coordinated site entry, construction and co-build and co-share to help operators improve network coverage quickly and at low cost.

In the first half, 1.17 billion square meters of areas of building was added, with total coverage reaching 13.85 billion square meters. The newly added coverage for subways and high-speed railway tunnels was 1,563 kilometers with total coverage reaching 30,878 kilometers.

Regarding Smart Tower business, with its fit firmly in the realm of spatial digital intelligence governance, the company has applied its advantages in resource endowments and capabilities to transform telecom towers into digital towers to serve major strategies and projects of the country as well as continuously strengthening its Smart Tower business.

First, the company identified customer demands focused on key industries such as land environmental protection, emergency response, water conservation and leveraged lease-based principle to advance strategic collaboration. It consolidated and expanded the leading edges in key scenarios such as farmland protection, straw burning, fisheries law enforcement and disaster alert.

Second, the company refined products, advanced the construction and operation of the distributed platform and optimized distinctive algorithm warehouses for mid- to high point and developed high-quality data sets for digital intelligent governance, further improve the competitiveness of products in key service scenarios.

Third, the company upgraded service delivery, developed high standard service systems, continued to elevate the service quality for customers in key industries. It reinforced local support and service teams to ensure swift response to customers' incremental development requirements.

Fourth, the company fortified security, improved the technical protection systems and enhanced technical protection capabilities for network information security across data terminals, platforms and cloud networks.

In the first half, the Smart Tower business grew strongly, achieving revenue of RMB 4.73 billion, up 18.7% year-on-year. As for Energy business, the company centered around its core business such as battery exchange and power backup and has drawn on its core competitive edges in products, services and platforms, strengthening its refined operations and sharpening the edges of the business.

First, it centered around customers' needs, accelerated the launch of new battery exchange products, continue to enrich the standardized product system and consolidate product competitiveness.

Second, it continued to promote the iteration and updates of battery exchange and power backup platforms to enhance the platform support.

Third, it strengthened management of the entire asset life cycle and established a VIP user benefit system to enhance user perception, continue to deepen refined operations.

Fourth, it upgraded online self-service and digital human functions for retail customers and provided comprehensive companion service system for corporate customers to improve customer satisfaction.

In the first half, Energy business made revenue of RMB 2.21 billion, a 9.2% increase year-on-year and a comparable growth of 17.9%, thus advancing on a good development trend. In the first half, the company continued to deepen reforms to re-inject new vitality into high-quality development.

First, it reinforced and enhanced management efficiency, advanced lean management, promoted quality improvement and efficiency enhancement and strengthened full life cycle asset management.

It advanced intensive management, established and refined a comprehensive system for large-scale maintenance and construction, continuously enhancing professional capabilities in construction and operation. It advanced quality management to focus on project quality, product quality and service quality to enhance quality management levels and it advanced product management and standardized the full life cycle management.

Second, it deepened and reinforced the regional reforms. It promoted the improvement and expansion of term-based and contractual management systems, reinforced operational responsibilities and stimulated vitality efficiency.

Third, it highlighted industrial transformation renewal promoted the 100 major projects initiative. It continued to enhance digital capabilities in professional fields and promoted the One Core for all nationwide enhanced the asset management efficiency to fuel business growth.

With its continuous effort to improve its technical innovation system, the company has seen the efficiency of scientific and technological innovation rising steadily. First, it strengthened R&D in critical technologies such as next-generation mobile communication, AI, edge computing, 5G Plus [ beta], 5G shared DAS, new energy and Internet of Things, et cetera.

Second, by releasing a series of achievement lists, smoothing transformation channels, conducting scientific and technological achievement evaluations and promoting transformation through categorization measures. The company accelerated the channeling of technological achievements into production.

Third, the company promoted the full list management mechanisms and steadily improve efficiency and effectiveness of innovation. In the first half, R&D investment and the team size increased by 87% and 29%, respectively, year-on-year, while the cumulative number of patent authorizations rose by 16% since the end of 2024.

The company attaches great importance to shareholder returns and have adopted an active dividend policy that insists on sharing the fruits of our business development with all shareholders.

The Board of Directors has resolved to distribute an interim dividend of RMB 0.13250 per share. A year-on-year increase of 21.6%. In the future, the company will actively create new corporate value, continuously improve profitability and create greater value for all shareholders. The company placed high emphasis on sustainable development and has actively fulfilled its ESG responsibilities.

Firstly, it upholded the philosophy of green development. It promoted the circular utilization of resources and expanded the use of clean energy such as PV in base stations. By integration, digital intelligence technology, the company supports environmental causes, including the prevention and mitigation of air, water and soil pollution as well as ecological protection. It also provided diverse new energy applications to the public, such as battery exchange and charging to support green mobility.

Second, it enhanced social well-being and people's livelihoods. It successfully completed major communication and network information security services for major events and provided emergency communication support during natural disaster relief missions such as bushfire prevention, typhoon response and flood control. It continued to improve telecommunication infrastructure in rural and remote areas, leveraging digital technology to support rural revitalization and eradicate digital divide.

Thirdly, it continuously improved corporate governance. It ensured a clear delineation of responsibility and effective checks and balances between various governance entities. It is committed to advancing the development of legal and operational compliance management systems and improving the level of legal and compliant business management. It provided high-quality information disclosure, actively strengthen capital market communication and enhanced market recognition of the company.

Looking ahead, the company will continue to uphold the philosophy of resource sharing and adhere to the One Core and Two Wings strategy to further enhance its core competitiveness and promote high-quality development.

On the TSP business front, it will fully capitalize on the development opportunities brought by national policies, including the dual gigabit network joint construction and special projects such as signal upgrade, extension of broadband coverage to all border areas and the upgrades of the 5G sailing project to capture opportunities presented by the continuous expansion of 5G network penetration coverage in China, give full play to resource coordination to promote steady development of the TSP business.

As for the Two Wings business, the company will actively implement digital intelligence governance and green and low carbon transformation development to quickly scale up the business.

That wraps up my presentation. Now Mr. Chen Li will present the details of the company's business performance. Thank you.

Thank you, Chairman. Now I will talk about the company's business performance in the first half of the year. This table shows the revenue of our businesses and relevant changes and key operating data. I'm going to explain them in greater detail.

In the first half, the revenue growth pattern supported by multiple pillars continue to deepen. Operating revenue reached RMB 49.6 billion, an increase of 3.1% on a comparable basis.

In terms of growth structure, the TSP business segment has generally maintained stable growth. Within this segment, Tower business revenue experienced a slight decline due to operators streamlining tower construction demand and reducing social costs, while DAS business continued to grow rapidly, recording a 33.3% incremental revenue contribution, pushing revenue growth up by 1 percentage point.

The incremental revenue contribution of the Two Wings business continued to grow, reaching 71.8%, of which 49.5% were from Smart Tower business, driving revenue growth up by 1.5 percentage points. The revenue contribution of the Energy business was 22.3%, boosting revenue by 0.7 percentage points.

Next, I will talk about development of our key businesses in detail. Regarding Tower business, the company focused on addressing customers' needs. Firstly, it implemented embedded service mechanism with a focus on TSP's network construction planning, comprehensively and accurately grasped key demand information and acquired orders by customer types and by network standards or frequency bands.

Second, it proactively conducted network coverage analysis, to identify weak coverage areas, enabling the development of comprehensive solutions and regional products to meet customer needs.

And third, the company continuously tackled difficult sites, focused on solving customers' urgent and troubling problems, giving full play to its resource coordination ability to help customers improve network coverage quality.

In the first half, revenue from Tower business reached RMB 37.8 billion, remaining basically flat compared with the same period last year. As at the end of June, the business had 3.579 million tenants, an increase of 2.5% year-on-year and tower tenancy ratio was 1.72.

As for DAS business, first, the company strengthened resource coordination and sharing capabilities in key locations, deepened signal upgrade initiative, kept pace with key project construction, gave full play to the advantages of coordinated site entry, accelerated demand acquisition and enhanced market service support capabilities.

Second, stepped up product innovation and applications, closely followed customer network development trends, strengthened innovation of DAS technologies, products and solutions, promoted new products and solutions such as active and passive DAS integration and shared multimode repeaters to expand the scale of DAS business.

And third, the company enhanced its professional service capabilities by focusing on the coverage in lifts, underground car parks and high-speed rail 5G special project and utilized shared micropower repeaters to reduce signal resources and transmission investments, continuously improved professional service capabilities.

In the first half, revenue from DAS business reached RMB 4.66 billion, a year-on-year increase of 12%, maintaining good growth momentum.

For Smart Tower business, leveraging its edges of having the unique mid- to high point site resources and algorithm technology, the company focused on the special digital intelligence governance field and accelerated the transformation of 240,000 telecommunication towers to digital towers. It continued to optimize industry application products, enabling it to provide customized digital intelligence solutions in key industries such as land, emergency response, water resources and environmental protection, significantly improving its customer service capabilities.

In the first half, Smart Tower business was able to maintain strong growth momentum with tower monitoring business making revenue of RMB 2.82 billion, 12.5% higher year-on-year, accounting for 59.7% of the total revenue of the business. Revenue from Tower Sharing business reached RMB 1.9 billion, up by 29.3% year-on-year. In the first half, based on the company's resource endowments and capability advantages in location plus computing plus power plus security, we continuously enhance the improvement of our capabilities.

In terms of platform capability, it strengthened the construction and operating of the tower monitoring distributed platform with over 2,400 standardized access nationwide opening, it continued to enhance product performance and user experience of the platform.

As for algorithm capability, it provided over 470 specific mid- to high point algorithms and established 490 million sample library to mid- to high point capabilities, enhancing the algorithm training and application and serving over 10,000 AI analytical scenarios with the accuracy rate for algorithm further enhanced.

With respect to product capability, it continued to enhance the efficiency of developing the next iteration, 15 specialized industry applications with 1,000-plus functional iterations were developed. Product competitiveness was further enhanced.

In service capability, strengthened major infrastructure system to deliver high-quality and efficient solutions. It enhanced professional operation and maintenance, upgrading unified monitoring capabilities on the platform and guaranteeing that clients business is under high-quality operation.

In innovation capability, the company drove technological breakthroughs in fields such as the new era of AI and spatial digital intelligence governance and edge computing, transformed telecom shelters to data shelters, accelerating the application of edge computing scenarios such as digital intelligence governance, pan campuses, Internet and AI.

For the development of battery exchange business, first, company actively capitalized on national new safe charging regulations to deepen penetration in key industries such as courier and delivery, continue to expand the customer base in battery exchange and recharge business. Meanwhile, the company deepened tiered customer management, delivering customized service based on user characteristics and continuously optimize the companion service system.

As of 30th June 2025, the number of battery exchange users reached 1.47 million, further consolidating the company's market leadership position.

Second, the company intensified operational management by accelerating the deployment of 4.0 battery exchange products while actively developing new 5.0 battery exchange products to enhance product competitiveness. Meanwhile, the company promoted the optimization of network for the core business circle for battery exchange and accelerated the construction of network for community charging facilities, continue to improve user convenience.

As of 30th June 2025, the company already launched battery exchange services in over 320 cities and optimized the network deployment. In the first half, the battery exchange business generated revenue of RMB 1.32 billion, representing a year-on-year increase of 14.4% on a comparable basis, maintaining robust growth momentum.

For power backup business, the company continued to cultivate in key industries such as telecom, finance, education and typical scenarios to expand quality customer base. It conducted in-depth analysis of customer needs to meet customer special needs in areas such as power backup, power generation, power -- green power to reduce carbon reduction and monitoring and maintenance.

The company also promoted comprehensive industry solutions to build the Energy Butler brand, realizing scalable development of the power backup business. In the first half, revenue from power backup business was RMB 890 million, up by 23.4% year-on-year.

Next, Mr. Hu Shaofeng will introduce the company's financial performance in the first half.

Thank you, Mr. Chen Li. This table shows the company's key financial indicators in the first half of 2025. For the first half, the company maintained very steady growth. The company makes effective investment according to its business development and capacity building needs.

In terms of our operating cost, it dropped.

In terms of amortization and depreciation, there was a major drop. This is to meet the new demands of our customers. And capital expenditure on new site construction and augmentation in the first half of the year was RMB 6.60 billion, down RMB 1.44 billion year-on-year.

For the repair and maintenance, it dropped by 6.2% year-on-year. That's because we try to rule out portable problems and improve quality. At the same time, we operate the [ tendering ] system and thus lowered the maintenance cost.

In terms of site operation, we have a professional operation and our battery backup capability has been improved. And the site lease fee and others has been further lowered.

For our OpEx, it's RMB 4.8 billion. That's to support our Two Wings business development and marketing expense, benefiting from the steady growth of our operating revenue, our profitability continued to improve. We realized a profit of RMB 8.6 billion, up by 0.5% year-on-year.

EBITDA increased by 3.6% year-on-year to RMB 34.25 billion. Net profit was RMB 5.70 billion.

The company in terms of its CapEx totaled RMB 12.392 billion, RMB 1.34 billion less than in the same period last year. Our new site construction and augmentation investment has been reduced effectively with the change of construction needs of operators. And CapEx, our new site construction augmentation first half was RMB 6.6 billion, down RMB 1.44 billion year-on-year.

For site replacement improvement based on large-scale implementation of battery, power backup capacity in key scenarios in the early stages, the company carried out asset safety inspection rectifications and equipment upgrades. Relevant capital expenditure in the first half amounted to RMB 2.38 billion, down by RMB 830 million against the same period last year.

For the Two Wings business, the company precisely allocated resources. CapEx for the Two Wings business in the first half was RMB 2.48 billion, an increase of RMB 600 million relative to the same period last year. Net cash flow generated from operating activities in the first half amounted to RMB 28.68 billion, a year-on-year decrease of RMB 4.15 billion and RMB 12.04 billion more when compared with the second half of last year, mainly attributed to the relative high cash flow base in the same period last year from centralized payment collection.

As at 30th June 2025, the company's liability to asset ratio was 39.5%. Gearing ratio was 29.5%, 1.5 percentage points less than the end of last year. In the second half, the company will seize development opportunities, keeping its One Core and Two Wings strategy, strengthen lean management, improve operational efficiency and effectiveness and keep boosting its profitability so as to create greater value for shareholders. Thank you.

[Statements in English on this transcript were spoken by an interpreter present on the live call.]