Shyue-Ching Lu

Thank you, Fu-fu. Hello, everyone. This is Shyue-Ching Lu, Chairman of Chunghwa Telecom. Thank you all for joining our full year 2011 earnings results conference call.

On slide no. 3, our total consolidated revenue for the full year 2011 amounted to NT$217.5 billion, with the increase mainly due to higher fixed line revenue resulting from the pricing right shift for fixed to mobile calls, as well as the increase in mobile VAS revenue and handset sales. Higher construction revenue from our property development subsidiary also contributed to the revenue growth.

Moving onto slide no. 4, we have maintained a 90% payout ratio for past few years, and this is expected to continue. On January 4, the amended Company Act was announced. In accordance with the amendment, a company that is profitable is allowed to directly distribute cash to shareholders from its capital surplus or legal reserves. Our capital surplus and legal reserves as the end of 2011 totaled NT$169.5 billion and NT$66.1 billion respectively.

As we understand the importance of stable dividends to some investors, the management team will decide whether to take advantage of this amendment and distribute this special dividend based on operational results. Relevant proposals require board and AGM approval prior to implementation.

We recently participated in China Airlines’ secondary offering and signed an MOU with the airline to form a strategic alliance. The board approved the project on January 16 after an extensive discussion by board members, which included the effectiveness of a strategic alliance, the execution of co-operation, and whether the possible risks could be acceptable. Prior to receiving boards approval, the issue was also discussed by the board’s strategy committee back in August 2011.

Now, I would like to hand over to President Chang to present our business overview.

Shaio-Tung Chang

Thank you Dr. Lu. In order to make a proper comparison with the peers, we would like to normalize the effect of pricing right shift for fixed to mobile calls. After normalization, the pro forma mobile service revenue represented a growth rate of 3.9%, the highest among the three major operators.

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