TAIPEI, Taiwan, March 27 /Xinhua-PRNewswire-FirstCall/ -- Chunghwa Telecom Co., Ltd (TAIEX: 2412; NYSE: CHT) ("Chunghwa" or "the Company"), today reported its operating results for fourth quarter and full year 2007. All figures are presented on consolidated basis and prepared in accordance with US GAAP.

(Comparisons, unless otherwise stated, are with respect to the prior year period)

Financial Highlights for Full Year 2007:

-- Total revenue increased by 7.8% to NT$200.9 billion

-- Internet and data revenue grew 5.8%; ADSL & FTTB revenue increased

by 5.2%

-- Mobile revenue grew 1.0%; Mobile VAS revenue increased by 24.2%

-- Net income totaled NT$49.5 billion, an increase of 17.5%

-- Earnings per share (EPS) increased by 18.5% to NT$4.68, or

NT$46.75 per ADS

Financial Highlights for 4Q07:

-- Total revenue increased by 10.1% to NT$52.4 billion

-- Internet and data revenue grew 2.5%; ADSL & FTTB revenue increased

by 2.3%

-- Mobile revenue decreased 0.4%; Mobile VAS revenue increased by 27.9%

-- Net income totaled NT$11.2 billion, remaining flat

-- Earnings per share (EPS) increased by 1.9% to NT$1.07, or

NT$10.72 per ADS

Revenue

Chunghwa's total revenue for 2007 increased by 7.8% year-on-year to NT$200.9 billion, of which 31.2% was from fixed-line services, 36.7% was from mobile services, 24.5% was from Internet and data services, and the remainder was from handset sales and consolidated revenue for SENAO.

Chunghwa's strong annual results were led by the consolidation of revenue from the Company's acquisition of SENAO, continued Internet & data revenue growth, and solid mobile business results. At NT$49.2 billion, Internet and data revenue in 2007 was 5.8% higher than in 2006, driven by continued total broadband subscriber growth and broadband speed upgrades. This growth was partly offset by an ADSL tariff adjustment that took effect on April 1, 2007. Mobile revenue increased by 1.0% in 2007 to NT$73.7 billion, mainly due to growing mobile subscriber numbers and significant mobile VAS revenue growth. Fixed-line revenue decreased by 0.6% year-on-year to NT$62.6 billion for 2007. The Company attributes this decrease to sustained mobile substitution, which resulted in a 0.1% local revenue decrease and a 6.6% domestic long distance revenue decrease. The fixed-line revenue decline was partially offset by a 2.4% increase in international long distance revenue, primarily attributable to significant revenue growth from international prepaid calling cards and the Company's wholesale business.

For 4Q 2007, total revenue was NT$52.4 billion, a 10.1% increase over the same period last year. Of this, 31.8% was from fixed-line services, 34.5% was from mobile services and 23.8% was from Internet and data services; the remainder is primarily attributable to the consolidation of NT$11.4 billion in revenue from SENAO beginning in 2Q 2007.

Costs and expenses

For 2007, total operating costs and expenses increased year-on-year by 6.2% to NT$138.1 billion, primarily due to NT$8.7 billion in subsidiary operating costs and expenses. The increase of operating costs from subsidiary was offset by the parent company's lower personnel expenses resulting from a smaller number of employees participating in the incentive retirement program, and a 27.4% reduction in handset subsidy expenses. At NT$39.4 billion, the Company's 2007 depreciation and amortization expense was 3.2% lower than 2006.

For 4Q 2007, total operating costs and expenses increased year-on-year by 11.1% to NT$37.5 billion, with most of the increase due to operating costs and expenses from the acquisition of SENAO.

Income tax

The Company's income tax for 2007 was NT$14.5 billion, a 4.8% decrease compared to NT$15.3 billion for 2006. This was mainly due to the decreased tax expense provision, which partially offset the income tax on undistributed earnings.



EBITDA and net income

EBITDA for 2007 increased by 5.2% year-on-year to NT$102.3 billion, resulting in an EBITDA margin of 50.9%, down from 52.2% for 2006. The EBITDA margin decline was derived from lower subsidiary EBITDA. Net income for 2007 was NT$49.5 billion, an increase of 17.5%. The strong increase in net income is primarily attributable to mobile and Internet and data revenue growth, effective cost controls within the parent company and a decreased tax expense.

Capex

Capital expenditures totaled NT$25.1 billon for 2007, of which 76% was for wire line (including fixed-line and Internet and data), 21% was for mobile equipment, and the remainder was for other investments.

Cash Flows

Net cash flow from operations decreased by 12.9% to NT$87.3 billion, as compared to NT$100.2 billion in 2006. This was primarily due to the increase in income tax payments. As of December 31, 2007, the Company's cash and cash equivalents totaled NT$76.2 billion.



Businesses Performance Highlights:

Internet and Data Services

-- Total HiNet subscribers decreased 5.2% year-on-year due to the

separation of 350k Prepaid Card subscribers from the total HiNet

subscriber base in May 2007. This decline was partially offset by

strong HiNet FTTB subscription growth, with 348k net additions over

the year bringing the total HiNet FTTB subscriber number to 528k on

December 31, 2007.

-- Overall, the Company had 4.25 million broadband subscribers

(including ADSL and FTTB) at the end of 2007, a 5.3% increase in

total broadband subscriptions compared to the end of 2006. By the end

of 2007, the number of ADSL and FTTB subscriptions with a service

speed of greater than 8 Mbps reached 1.21 million, representing 28.5%

of total broadband subscribers.

-- As of the end of 2007, Chunghwa had 394k MOD subscribers, a solid

58.3% year-over-year increase, with 37k new subscriptions added

during the fourth quarter 2007 alone.

-- Total Data revenue were NT$11.5 billion in 2007, a 5.4% increase

compared to 2006. This was primarily attributable to continued

revenue growth from the MOD, HiLink and IDC businesses, and the

consolidation of NT$578 million of Chief Telecom revenue.

Mobile Services

-- As of December 31, 2007, Chunghwa had 8.70 million mobile

subscribers, slightly up quarter-on-quarter by 0.5% compared to

8.66 million as of September 31, 2007.

-- Chunghwa remained the leading mobile operator in Taiwan. According to

statistics published by the NCC, at the end of 2007, the Company's

total subscriber market share (including 2G, 3G and PHS) was 35.8%,

while the Company's 2G revenue and 2G subscriber market share

positions were 34.5% and 40.3%, respectively.

-- Chunghwa had 298k net additions to its 3G subscriber base during the

fourth quarter, with the 14.9% rise boosting the total number of 3G

subscribers to 2.29 million on December 31, 2007. At the end of 2007,

3G ARPU was 63% higher than that of 2G.

-- Mobile VAS revenue for 2007 was NT$5.2 billion, posting an 24.2%

increase year-on-year, with SMS revenue up 28.6% and mobile internet

revenue up 42%.



Fixed-line Services

-- As of the end of 2007, the Company maintained its leading fixed-line

market position, with fixed-line subscribers totaling 12.95 million.

Recent Updates

In its two-month share buyback program, which commenced on August 29, 2007, the Company repurchased 121.1 million common shares. Because of the capital reduction program conducted last year, the repurchased shares were reduced on pro rata in 4Q 2007. Furthermore, the Company cancelled the remainder in February 2008; as a result, the total number of shares outstanding is now 9.56 billion.

Financial Statements

Financial statements and additional operational data can be found on the Chunghwa Telecom website at http://www.cht.com.tw/ir/filedownload .



About Chunghwa Telecom

Chunghwa Telecom (TAIEX 2412; NYSE: CHT) is the leading telecom service provider in Taiwan. Chunghwa Telecom provides fixed-line, mobile and Internet and data services to residential and business customers in Taiwan.

Note Concerning Forward-looking Statements

Except for statements in respect of historical matters, the statements made in this press conference contain "forward-looking statements" within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. Such forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause the actual performance, financial condition or results of operations of Chunghwa Telecom to be materially different from what may be implied by such forward-looking statements. Investors are cautioned that actual events and results could differ materially from those statements as a result of a number of factors including, among other things: extensive regulation of telecom industry; the intensely competitive telecom industry; our relationship with our labor union; general economic and political conditions, including those related to the telecom industry; possible disruptions in commercial activities caused by natural and human induced events and disasters, including terrorist activity, armed conflict and highly contagious diseases, such as SARS; and those risks identified in the section entitled "Risk Factors" in Chunghwa Telecom's Form F-1 and F-3 filed with the U.S. Securities and Exchange Commission in connection with our ADR public offering.

The financial statements included in this press conference were prepared and published in accordance with US GAAP. Chunghwa Telecom also prepared certain financial statements for the same periods discussed in this press conference under ROC GAAP. Investors are cautioned that there are many differences between US GAAP and ROC GAAP. As a result, our results under U.S. GAAP and ROC GAAP may in many events be substantially different.

The forward-looking statements in this press conference reflect the current belief of Chunghwa Telecom as of the date of this press conference and we undertake no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such date.

For inquiries:

Fu-fu Shen

Investor Relations

Tel: +886-2-2344-5488

Email: chtir@cht.com.tw

SOURCE Chunghwa Telecom