TCC considers paying cash dividends next year

The China Post staff

Taiwan Cellular Corp. (TCC) yesterday said it may consider paying cash dividends next year, after a NT$3.2 stock dividend per share this year. TransAsia Telecommunications (TAT), in which Taiwan Cellular acquired a 97 percent stake for NT$13.5 billion last month, is expected to start making an earnings contribution to the parent company in the second half of the year. Currently, TCC is the largest cellular operator on the island with over 5.6 million subscribers, while its newly acquired TAT has around 730,000.

According to executives of TCC, TAT is expected to exceed the NT$1.5 billion pretax profit on sales of NT$7.9 billion forecasted for 2001 after listing on the OTC market Apart from the possible cash dividend, TCC said it will focus on strengthening its existing subscriber base by means of introducing more value-added services rather than seeking to expand it given the over-80 percent saturation rate of the Taiwan market. “We posted record sales and profit in July even though we started to abolish handset subsidies – a measure generally designed to secure an unrealistic increase in the number of subscribers,” said TCC president Joseph Fan. Fan said they are also considering the timing for the planned Depository Receipt (DR) issue on a maximum of NT$330 million shares by taking into account the company’s involvement in the 3G (third generation) business and strategic investment both at home and abroad. According to the company, the proposed DR issue has been approved by the board and shareholders at an AGM.