Consolidated Results Consolidated Results ( HK$ M) 1 H0 5 1 H0 4 - PowerPoint PPT Presentation

Consolidated Results Consolidated Results ( HK$ M) 1 H0 5 1 H0 4 % chg. Turnover 1,223 1,154 + 6% (816) (731) + 12% Opex before dep’n EBI TDA 407 423 -4% Depreciation (251) (274) -8% Operating profit 156 149 + 5% Net interest expense - - - Non-operating expense 1 (1) - Profit before taxation 157 148 + 6% (2) (1) + 100% Taxation Net profit 155 147 + 5% EPS ( HK cents) 7.7 7.3 + 5% 3.5 3.0 + 17% DPS ( HK cents) • Revenue and profit growth continued notwithstanding intensified competition

Operating Expenses Operating Expenses % chg. % chg. ( HK$ M) 1 H0 5 2 H0 4 1 H0 4 vs 2 H0 4 vs 1 H0 4 Program m ing 421 424 -1% 367 + 15% Netw ork & Others 197 192 + 3% 187 + 5% S, G&A 198 196 + 1% 177 + 12% Sub-total 816 812 + 0% 731 + 12% Depreciation 251 258 -3% 274 -8% Total 1,067 1,070 -0% 1,005 + 6% • Programming cost increased by 15% YoY but was flat HoH • Depreciation decreased 8% YoY due to expiry of depreciation cycle on network and CPE assets

Pay TV Pay TV 1 H0 5 1 H0 4 chg. Subs ( 0 0 0 ) 718 682 + 36 ARPU ( HK$ ) 216 222 -6 • Sub growth continued in a seasonally weaker first half in the absence of special events (e.g. Euro 2004) • ARPU declined 3% due to aggressive marketing of lower yield mini packages to meet market demand

Pay TV Pay TV ( HK$ M) 1 H0 5 1 H0 4 % chg. Turnover 948 920 + 3% Opex before dep’n (622) (540) + 15% 326 380 -14% EBI TDA (131) (145) -10% Depreciation Operating profit 195 235 -17% • Opex before depreciation increased by 15% YoY (mainly due to higher programming costs) but only 4% HoH • EBITDA and operating profit declined due to Opex increase

Internet & Multimedia Internet & Multimedia 1 H05 1 H04 Chg. Broadband Subs ( 00 0 ) 301 263 + 38 ARPU ( HK$) 144 142 + 2 69 - + 69 VoI P lines ( 0 0 0 ) • Sub surpassed 300K due to service enhancement thru network upgrade, bundling strategies and continued introduction of value- added services • ARPU rose marginally notwithstanding intense competition • VoIP lines grew by almost 40K during 1H05

Internet & Multimedia Internet & Multimedia ( HK$ M) 1 H05 1 H04 % Chg. Turnover 279 232 + 20% Opex before dep’n (132) (133) -0% EBI TDA 147 99 + 48% Depreciation (117) (126) -7% Operating profit/ ( loss) 31 (27) - EBI TDA m argin 53% 43% • Turnover increased by 20% to reach new high • Record EBITDA and operating profit generated

Capex and Cash Flow and Cash Flow Capex 500 500 450 450 EBITDA 400 400 350 350 HK$ Million 300 300 250 250 CAPEX 200 200 150 150 100 100 50 50 - - 1H00 2H00 1H01 2H01 1H02 2H02 1H03 2H03 1H04 2H04 1H05 • Capex decreased 47% YoY to HK$125M due mainly to lower spending on digital and broadband upgrade migration • Free cashflow continued to trend upwards

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Pay TV - - Competitive Landscape Competitive Landscape Pay TV • Bundling of pay television, broadband and voice was the main battlefield • NOW - In the market now for almost 2 years - Continue to be aggressive in marketing and content acquisition • Galaxy - In the market now for one and a half years - Renamed SuperSUN TV - Secured new funding - More aggressive in marketing - Reached agreement to distribute over HGC’s network and to bundle with HGC’s voice and data services

Pay TV - - Our Response (1) Our Response (1) Pay TV • Mini packages with lower price point marketed to segments targeted by the competition and enable greater subscription flexibility • News Platform - News 1 Channel transformed to financial service channel during trading hours - Live News Channel launched to provide live carriage of events in full length • Sports Platform - Exclusive carriage of EPL and the new Soccer Betting Channel have been well received - Preparation for FIFA World Cup 06 under way

Pay TV - - Our Response (2) Our Response (2) Pay TV • Entertainment Platform - Increase emphasis on self production - Parenting programme launched in Children Channel in July - Nightly primetime life-magazine programme to be launched on Entertainment Channel in August • New programming initiative intended to enhance “stickiness” of platform

Internet & Multimedia Internet & Multimedia • Bundled packages proven to be competitive in the market • Continue to enhance multimedia content • imusic, a new music download portal just launched with participation of major music labels • Will continue to improve after-sale service

New Opportunities New Opportunities • Horizon Channel continued to expand its distribution in China • Secured deal to supply entertainment video content to the mobile phone market in Mainland China • Newsline Express, the multimedia service on Kowloon-Canton Railway Corporation’s trains, has launched in August • Sundream Motion Pictures: - shooting of first film (“Twilight of the Uncertainty”* ) to begin in August - production of several more films including (“A Battle of Wits”* ) starring Andy Lau expected to commence during the remainder of 2005 * working title

Summary Summary • Continued to achieve growth in subscription, revenue and profit notwithstanding intensified competition • Brunt of cost pressure on pay TV business has been taken • Broadband business returning to a profitable growth track • Will continue to look for opportunities to expand beyond our core businesses

i-CABLE Communications Limited HKSE Stock Code: 1097.HK NASDAQ Symbol: ICAB 19

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