Good afternoon, ladies and gentlemen, welcome to Chunghwa Telecom conference call for the company's fourth quarter 2024 operating results. During the presentation, all lines will be on listen-only mode. When the briefing is finished, directions for submitting your questions will be given in the Q&A session. And for your information, this conference call is now being broadcast live on the internet. And webcast replay will be available within an hour after the conference is finished. Please visit the CHT IR website, www.cht.com.tw/ir under the IR calendar section. And now I would like to turn the call over to Ms. Angela Tsai, Assistant Vice President of Investor Relations. Thank you. Ms. Tsai, please go ahead.

Thank you. I am Angela Tsai, Assistant Vice President of the Finance Department for Chunghwa Telecom. Welcome to our fourth quarter 2024 results conference call. Joining me on the call today are our President, Rong-Shy Lin; and our Chief Financial Officer, Audrey Hsu. During today's call, management will begin by providing the CEO's -- the rest of achievements of our company and our business overview of the fourth quarter, followed by a discussion of our segment performance and the financial results. After, we'll move on to the question-and-answer portion of the call. On Slide 2, please read our disclaimers and notes concerning forward-looking statements. Now, without further delay, I will turn the call over to President. President Lin, please go ahead. Rong-Shy Lin: Thank you, Angela, and hello, everyone. Welcome to our fourth quarter, 2024 results conference call. To begin with, I would like to report our exceptional financial performance for year 2024. Thanks to our team's relentless efforts, Chunghwa Telecom’s operating income, income before tax, and the EPS for 2024 all exceeded the upper end of our forecast, highlighting our strong execution and effective strategic direction. Revenue-wise, our full year’s revenue reached a seven-year high, driven by robust growth across all of our business sectors. Notably, our full year EPS of NT$4.8 also marked a seven-year high, continuing a streak of five consecutive years of annual growth. This achievement underscores our unwavering commitment to innovation, operational excellence, and delivering sustained value for our stakeholders. In collaboration with NTT, we showcased an ultra-low latency immersive video show in the fourth quarter via the world's first international all-photonic network connection powered by IOWN technology. We successfully reduced the VR-induced sickness in the exhibition, enabling the new virtual viewing solution. Additionally, our partnership in Open RAN cooperation opens new avenues for global opportunities. Chunghwa Telecom is the only telecom in Taiwan capable of offering Open RAN testing, has successfully supported Taiwanese vendors in securing funding from the U.S. government for Open RAN development. The collaboration highlights our cutting-edge technological capability and unique position in accelerating commercialization of Open RAN within value chains. Furthermore, we look forward to utilizing OneWeb and SES satellite resources to roll out commercial services by the first half of 2024, further driving the growth in satellite-related revenue. Lastly, I would like to highlight that in the fourth quarter, we once again maintained our position in the 2024 Dow Jones Sustainability World Index and Emerging Markets Index. We also received the highest honor from the Asset ESG Corporate Jade Award and represents the only Taiwanese telecom included in the Newsweek’s World’s Most Trustworthy Companies 2024 list. This recognition reaffirms our commitment to sustainability and leadership in responsible business growth. Looking ahead into 2024, Chunghwa Telecom is confident in maintaining its leading position across all key benchmarks in our industry. Now let's move on to the business overview of the fourth quarter of 2024. Please turn to Page 5 to review our leading position in Taiwan's mobile market. Based on the statistics from Taiwan's Telecom Regulator of November, our overall subscriber share of Taiwan's mobile market reached 37.9%, achieving its 11th consecutive quarter-over-quarter increase. We are happy to see ongoing subscriber growth. Even more excitingly, our 5G subscriber share surpassed our mobile subscriber share, reaching 38.8% and maintaining our position as an industry leader. We are glad to see our year-over-year growth of the postpaid subscribers increase 0.2 million, with a significant growth of 0.7 million in 5G postpaid subscribers. Additionally, our revenue share maintained the highest in the industry at 40.3%, consistently outperforming our subscriber share and reflecting our strong and healthy growth. According to the financial disclosure of domestic industry players, we also learned that from January 2024, our quarterly subscriber net-adds outperformed peers for every quarter throughout this year. Along with our steady 5G penetration, our mobile service revenue recorded a 1.7% year-over-year increase in the fourth quarter and a 3% year-over-year growth of the full year of 2024. In the fourth quarter, we are pleased to see the average monthly fee uplifted from 5G migration showing a 45% increase, maintaining its healthy momentum. Let's move on to the Slide 6 for an update of our outperforming fixed broadband business. In the fourth quarter, our cross-tier upgrade promotion package continued to be well-received, as more than 70% of the package adopters chose service offerings of 300Mbps and above, including the highest speed offering of 1Gbps. As a result, on a year-over-year basis, the number of subscribers with speeds of 300Mbps and above increased by 17%, maintaining its double-digit growth, and our subscriber net-adds of 1Gbps service doubled, which is encouraging. Given the success, our total number of fixed broadband subscribers also saw an increase in the fourth quarter. Thanks to our successful speed upgrade strategy, our fixed broadband revenue and ARPU continued to increase by 2.9% and 1.7% on-year, respectively, and we are confident that this growth will persist. Now let's get a close look at the performance of our business group. Page 8 presents our CBG's performance. In the fourth quarter, the total CBG revenue increased by 2.2% year-over-year, driven by the increase of mobile service revenue resulting from 5G migration and subscriber growth, along with the increased fixed broadband revenue, owing to the successful speed upgrade strategy. In addition, sales revenue rose year-over-year, mainly due to the stronger smartphone sales. Our CBG's income before taxes grew NT$0.077 billion year-over-year, primarily due to the strong performance of our core business and one-time impairment loss, recognized in the fourth quarter of 2023. Slide 9 further illustrates our Consumer Business Group highlights. In the fourth quarter, our multiple-play packages, with service offerings of mobile, fixed broadband and Wi-Fi altogether, continued to deliver outstanding year-over-year growth of 57%. This success is attributable to the strength of our quality networks and the effectiveness of our reward point strategy. In the fourth quarter, we were extremely proud to see that Taiwan won the World Baseball Softball Confederation's Premium 12 for the first time. This remarkable event, following the popular Olympic Games in the third quarter, further boosted our video service subscription, which reached a record high with 15.2% year-over-year increase, with particular growth from our OTT brand, Hami Video. Revenue from both subscription and advertisement on the platform continued to grow as well, and we are committed to maintain the positive momentum by consistently investing in the popular content going forward. In addition, our consumer cybersecurity subscription also surged by 22% year-over-year in the fourth quarter, steadily increasing its revenue contribution as expected. Thanks to our ongoing efforts in the business mentioned, we have reached a milestone of three million subscribers as of December 2024, including around two million Wi-Fi device subscriptions, more than one million subscriptions of Hami Video and consumer cybersecurity services. We are optimistic with the continued growth in the coming year. Please turn to Slide 10 for an overview of our Enterprise Business Group performance. In the fourth quarter, EBG's total revenue increased by 10.2% year-over-year, primarily driven by a robust 24.1% year-over-year growth in ICT business revenue. Major growth drivers such as IDC, cloud, and cybersecurity services all delivered strong performance and demonstrated around 50% year-over-year growth, fueled by both project and recurring revenue. Despite the ongoing 5G migration and fixed broadband speed upgrades, which continued to positively contribute to related service revenue, the decline in mobile voice revenue and fixed voice revenue resulted in relatively flat year-over-year performance in our EBG's core business. This, in turn, contributed to a decline in EBG's income-before-tax on a year-over-year basis. Slide 11 illustrates our Enterprise Business highlights. We are excited to report the strong performance of our emerging business in the fourth quarter, with its revenue increased by 23% year-over-year. The growth was driven by strong performance across our major pillars and the recurring revenue growth from all service offerings. For our IDC, cloud, and cybersecurity business, we saw a year-over-year revenue increase of 62%, 46% and 56%, respectively. For IDC business, we were happy to see revenue contributions from several large projects completed for the high-tech companies in Taiwan, as well as the successful construction of the first overseas AIDC in Mexico for our enterprise customers. Additionally, higher margin racks and new IDCs in operation also contributed to recurring revenue, ensuring that group maintained a stable, consolidated IDC market share in Taiwan at more than 50%. Also in the fourth quarter, our cybersecurity business achieved its 12th consecutive quarter of year-over-year growth, including subsidiary contributions. For the fourth quarter, we are proud to report that the successful development of Taiwan's first 5G unmanned vehicle solution for smart harbor inspection. This solution is capable of operating across land, sea, and sky, enabling robots to handle post-transportation unmanned vehicles to clean marine pollution, and drones to rescue in water. We expect to further extend this application into other sectors, including firefighting, coastal patrolling, forest ecosystem protection, etc. Lastly, we remain optimistic about AI-driven opportunities this year. We have leveraged generative AI technology to deliver projects in smart government and healthcare sectors, enhancing efficiency and reducing manpower costs through checkboxes for troubleshooting and information retrieval. Additionally, we are utilizing AI medical assistance to generate medical summaries and reduce paperwork. We believe that more generative AI applications will emerge to create opportunities in the future. Slide 12 illustrates our International Business Group performance. In the fourth quarter, IBG's total revenue dipped slightly by 2.3%, mainly due to the decline in international voice revenue. However, as our robust IDC business grew and its demand continue to increase, IBG's income before tax increased year-over-year. As we continue to expand our IDC business to cater to the increasing demand, in the fourth quarter, we agreed to close a contract with a well-known global hyperscaler. This agreement secures capacity in our under-constructed IDC for the higher scale and ensures the long-term stable revenue generation of Chunghwa Telecom. Additionally, our overseas subsidiaries have achieved remarkable business success worldwide in 2024 by providing our ICT solution to high-tech companies in Japan and the United States, as well as providing ICT total solution to the PCB industry in Southeast Asia, and providing our exceptional capabilities. More excitingly, our CapEx allocation in undersea cables has also yielded positive results. Although the SJC2 and Apricot international submarine cables are still awaiting completion, currently 80% of the capacity we invested in was sold in the fourth quarter of 2024. This is expected to bring revenue in the second half of this year, reflecting strong demand for the international boundaries and the success of our investment strategy. Now I would like to turn the call to Audrey for our financial highlights.

Okay, thank you, President Lin. Good afternoon, everyone. It is my pleasure to present an overview of our financial performance for the fourth quarter of 2024 and share our financial guidance for 2025. Let's turn to Page 14, which highlights our income statement. For the fourth quarter of 2024, revenue exceeded NT$65 billion. This represents a 5.6% increase compared to the same quarter last year. This growth was primarily driven by significant expansion in our ICT business. Income from operations and net income increased by 11.5% and 9% respectively. Additionally, earnings per share for the quarter reached NT$1.16, marking the highest fourth quarter EPS in nine years. Let's now move to the columns for the full year of 2024 as we shift our focus from quarterly to annual performance. For the entire year, revenue increased by 3.1% compared to 2023, driven by sustained strong performance across ICT, mobile and broadband services. Income from operations and net income increased by 1.1% and 0.8% respectively, highlighting the steady growth of our core and ICT business. Earnings per share for the whole year reached NT$ 4.8, while the EBITDA margin remained stable at 37.6%. This solid performance reflects the resilience and strength of our operations. Now let's move on to Page 15 to review the balance sheet highlights. At the end of 2024, total assets increased by 2% compared to 2023. The increase was largely attributable to the growth of our cash, other current monetary assets and long-term investments. Also, property, plant and equipment decreased, primarily because the addition of new assets was less than depreciation recognized. Total liability increased by 5.7% relative to the year-end of 2023, primarily due to the increase in accounts payable and contract liabilities. Additionally, debt ratio remained stable and net debt over EBITDA remained at zero. A low debt level not only underscores our company's commitment to fiscal responsibility, but also enhances our resilience against economic uncertainties. So taken together, these metrics demonstrate the robustness and stability of our balance sheet. Now let's turn to Page 16, which provides the summary of our cash flow. Cash flows from operating activities increased by 6.2% year-over-year, primarily due to the increase in accounts payable and contract liabilities between 2024 and 2023. Capital expenditure for the year 2024 was NT$28.82 billion, reflecting a 6.2% year-over-year decline and achieving 15% savings compared to the budgeted amount announced in our 2024 forecast. The reduction is part of our approach to optimize capital allocation. As a result, free cash flow increased by 14.9% on-year, highlighting the strength of our operating efficiency and disciplined financial management. The robust free cash flow enhances our financial flexibility. This enables us to pursue strategic growth opportunities while we enforce our long-term sustainability. Earlier I was comparing our results relative to last year. Now I'm shifting focus to compare our 2024 performance relative to our forecast. On Page 17, you will see the table summarize our operating performance relative to our forecast. During the fourth quarter of 2024, revenue exceeded our targets. Key performance measures, including income from operations, net income, and EPS, were all in line with our forecast. The performance was supported by ongoing efforts to streamline operations and control costs. Slower network construction activity also resulted in depreciation expense coming in below expectations. Moving to the column for the full year, revenue in 2024 aligned with our forecast. In addition, income from operations, net income, and EPS all surpassed our guidance. These better than expected results were primarily driven by the steady growth of our core business and enhanced profitability of our ICT segment. This concludes our review of the financial results for the fourth quarter and the full year of 2024. Finally, I would like to provide our forecast for 2025. Moving on to Slide 18, please refer to our guidance for 2025. Looking ahead, we anticipate total revenue for 2025 to grow by 1.2% to 1.6% compared to 2024. The growth is expected to be driven by strong growth momentum in our core business, supported by the success of our 5G service and broadband speed upgrade promotions, which are boosting our subscriber numbers and ARPU. Additionally, ICT business is also expected to contribute to revenue growth as we continue to see digital transformation opportunities in the market. For operating costs and expenses, we are expecting it to rise by 2.4%, riveting our continued investment in talent, including enhancement to employee benefits, and growing infrastructure that supports future business development in core and emerging business. And also higher electricity costs, stemming from rate adjustment, which would also trade up operation and maintenance expenses. Given these projections, we expect our EPS to be in the range between NT$4.62 and NT$4.82. In terms of CapEx, we have budgeted NT$32.36 billion for 2025. Our mobile-related CapEx is expected to decline by 13.3% on year. This continues a four-year consecutive downtrend since 2021. In contrast, non-mobile-related capital expenditures are expected to increase by 25.2% year-over-year, driven by investments to support business expansion into AI, Internet Data Centers, the constructing of submarine cables, and other strategic initiatives. Our capital expenditure strategy focuses on maintaining a competitive edge, enhancing network resilience and security, and advancing ESG commitments by eliminating energy-intensive equipment. Thank you for your attention. At this time, we would like to open the door for questions.

Yes, thank you. Ladies and gentlemen, we are now in Q&A session. [Operator Instructions] Thank you.

Okay. We received a question from our platform. Could you please elaborate a bit on how much we are investing in AI and some key initiatives or revenue opportunities this year?

As I just mentioned, for the focus of the CapEx, for the non-mobile parts, there is an increase of the CapEx in the in the AIDC center. We don't disclose the breakdowns for our mobile CapEx, but we can give you some overview of our company's mission related to AI. We are fully committed to leverage AI to enhance our operations and drive digital transformation for our business. Through strategic partnership and innovation, we basically will cover the internal AI application. We will also cover the external, something like AI infrastructure and platforms. To give you some example, at the AI data center, we launched a sovereign AI service, optimized cloud resources, and integrated AI solutions across cloud and on-premise environments with a focus on sustainability and intelligence. Also, we also have AI factory. We provide cross-cloud path solution, including standardized public cloud bundles and resource management. And we also built some soft capabilities, including domain-specific AI models, digital twins in AI region. So other than that, we may also strengthen our AI capabilities through collaboration with leading academic institutions, research centers, cloud providers, and NVIDIA to accelerate development and deployment. So this is just to give you some overview of our strategy for the AI in the coming years.

Okay, thank you, Audrey. We have another question. So give me a second. It's about the outlook of the ICT business in 2025. For the ICT business, in 2024, we are glad to see that our ICT revenue has successfully exceeded our full-year guidance. And for 2025, we are also focused on our major pillars of the ICT services, like the IDC, cloud, cybersecurity, our 5G private network, the sectors that we have a great performance in 2024. But what we have to do is that we will focus more on improving our ICT project margin to enhance the overall ICT performance. In addition, as the recurring revenue percentage continues to increase in the percentage of the total ICT revenue, we think that the increase of recurring revenue will further stabilize our ICT revenues and further increase the overall ICT margin in 2025.

Ladies and gentlemen, we are now in Q&A session. [Operator Instructions] Thank you.

Okay, we have one more question from the platform. It's about, do you have any plans to improve shareholder return, like raising the payout?

As mentioned before, that maximum shareholder returns is always one of the key objectives of our corporations. As the dividend policy, we are a company that focuses very much on sustainability. Keeping a sustained dividend policy is always our goal. And dividend policy is subject to the Board of Directors' approval, but I expect that the policy will be based on the -- will be consistent with the previous policy. So, as the EPS increases continuously, we may expect that shareholders will receive a continuous increase in dividends following our consistent dividend policy. So this is the basic guidance.

Thank you, Audrey. I have another question. Given that non-mobile CapEx is going up by a sharp 25% in 2025, can you provide more details about where this CapEx is going, including how much it's going for AI data centers?

Thank you for the question. As I mentioned, we don't disclose the breakdown of our non-mobile CapEx. As we mentioned, many of our segments for the corporation ICT, you can imagine that we will deploy our capital resources based on mainly the AIDC center, the submarine and satellite, etc. So just give you -- as you can see, we see the digital transformation opportunities in the market, mainly from the AI and also cloud computing and also cybersecurity. This is our growth engine for the company. Although at this moment, the 25% increase is our expectation, but we believe that, I just want to remind you that our CEO will always want us to try to simplify, to apply the 80/20 rule to prioritize resources on the most impactful projects, ensuring optimal allocation and maximum returns. We think that the actual spending of this year will probably decrease if the 80/20 percent rule to do the right things right principle continues to be applied. We will streamline our operations, so we probably will save more capital expenditures in the future.

[Operator Instructions] Thank you.

Okay, thank you. We have another question. In terms of the revenue guidance of NT$1.2 to NT$1.6 in 2025, could you elaborate more on the growth drivers and breakdown of different segments?

Building on the foundation of our success in 2024, we believe this position for a strong future. So I just tried to remind you, in 2024, we maintained our leadership in Taiwan's mobile market. We achieved 40% of revenue and growth in 5G postpaid subscription, and we also have a 38.8% of 5G subscriber market share in Taiwan. And also fixed broadband, if you remember our cross-tier upgrade promotion also provided highly effective doubling 1G subscriber net-adds with over 70% of adopters choosing 300Mbps and above. So this strong performance, we believe that we can set a stage for the long-term opportunity and for 2025. So the growth opportunities, we would like to continue this momentum in the mobile industry. And other than that, I just share a lot about the ICT opportunity. We still believe that the high growth will come in a lot through the ICT business segment.

[Operator Instructions] Thank you.

Okay, we have one more question from the platform that is about our CapEx breakdown. I think for the CapEx budget for 2025, as our CFO said, the mobile CapEx continues to decline. And for non-mobile parts, we have some increase. That's because that the increase is mainly from the fixed line, because the fixed line is the backbone to support the mobile and the fixed line services and then the IDC and the undersea cable because we see great demand from the markets to require more capacity from the international bandwidth. And then we see, as we discussed from the presentation, you can see that we secure a lot of contracts with the hyperscaler to co-locating our IDC. So as we see the growth opportunities, so we continue to invest in this kind of area. Thank you.

[Operator Instructions] Thank you. Thank you, ladies and gentlemen. If there are no further questions, I will turn it back over to President Lin. President Lin, please begin. Rong-Shy Lin: Thank you for your participation and a Happy New Year.

Thank you, President Lin. And ladies and gentlemen, we thank you for your participation in the Chunghwa Telecom’s Conference. There will be a broadcast replay within an hour. Please visit www.cht.com.tw/ir under the IR calendar section. You may disconnect now. Thank you again, and goodbye.