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Far EasTone to Collaborate with Global Partners in 5G and IoT, Best Dividend-Payout Ratio in Industry for 6 Consecutive Years

Taipei, Taiwan - June 23, 2017 – At today’s 2017 Far EasTone Telecommunications Co. Ltd. (4904: TAI) annual meeting of shareholders, company chairman Douglas Hsu led the management team to present shareholders with FET’s performance in 2016 and its strategic planning.

Thanks to the tireless efforts of FET staff, total revenues in 2016 reached NT$94.3 billion, and EBITDA (earnings before interest, taxes, depreciation, and amortization) and net income amounted to NT$27.8 billion and NT$11.4 billion, respectively. The EPS of NT$3.5 leveled with the figure of 2015, and in keeping with its dividend payout policy, FET paid out NT$3.75 per share this year, representing a dividend payout ratio of 107%, the highest in the industry for the sixth consecutive year.
FET’s management team will continue to create steady value for investors and build even more solid cornerstone for the Company’s operations. At the same time, the management team solemnly declared that FET will not be absent in the pursuit of digital convergence, and will bid for the last mile in the family through mobile, high-speed, and stable 4.5G tri-band network to provide consumers with true enjoyment of smart home. Additionally, the world’s first  caring services based on IoT(Internet of Things), innovative services in information communication technology and telecommunications will also be launched shortly to pave the way to a new digital era through mobile network.

Deepen Collaborations with Int’l Partners in 5G Technology and IoT
Based on core competency, FET develops smart services and business applications with IoT technology, and commit to 5G technology development, applying the concept of IoT to vertical industry solutions and people’s life. FET is not only the first telecom operator to set up 5G Lab in Taiwan, but also works with Ericsson from mutual strengths, leveraging its global reputation and influence, to create innovative solutions  and applies those advantages to transportation, audio/video content, and utility  such as water and electricity. On the other hand, since FET established, NTT DOCOMO has been an important shareholder which  has helped significantly expand some of FET’s cutting-edge ICT technology. FET expects to deepen the collaborations between internationally-leading partners in 5G technology with regard to mobile cloud, Smart Life and IoT technology, and provide more diversified and innovative services. Moreover, FET will initiate brand new business models and gear up with the global trend and IoT business opportunities.

Participation in Digital Convergence and Mobile Lifestyle; To Establish a ‘Mobile-Centric’ New Era
Founded on the FET’s comprehensive, diversified long-term objective, the Company plans to enter the last mile at consumer’s households through mobile network. Provision of digital services needed at home is a crucial development strategy and direction to FET. The Company also plans to provide integrated services including video conferencing, data, voice-activated smart-home systems, entertainment and other value-added services to family users, and its objective is to become the pioneer in digital home services as well as the most trustworthy brand to consumers and the number one choice for digital home services.
In particular, sales of ‘4G Home Router ’ package in 2016 has jumped by 64% YoY, and the Home Services Development Division will launch brand new services in the second half of the year to enhance user enjoyment of Smart Life, on top of leading the way to a new era of digital convergence.

Leading the Industry with 107% Dividend-Payout Ratio; Keeping Launch Innovative Services in H2 of 2017 to Build Comprehensive Smart Life
FET paid NT$3.75 in cash dividend per share this year, showing a 107% dividend payout ratio. Mr. Hsu stated that, “A business can only develop sustainably through creating higher return on investment (ROI) and through truly realizing corporate governance in practice. FET strove for, and has delivered ideal results in 4G operations, and not only are we leading the industry in terms of 4G penetration rate, but our ARPU contribution margin is also the highest in the industry. We will have almost 5.5 million users by year-end, and our highly-anticipated IoT social services will be launched shortly. We plan to encourage the love and caring between individuals through innovative technology to create smarter mobile lifestyle and to bring more positive surprises to our users and shareholders. This is the perfect illustration of how FET is capable of servicing, connecting, and amazing our customers.”

FET won numerous recognitions in 2016. The Company participated in the selection of Dow Jones Sustainability Indices (DJSI) for the first time and was nominated as constituent stock in the DJSI-Emerging Markets, showing prominent recognition from global sustainable investment institutions. Concurrently, FET was also nominated as Top 10 in CommonWealth Magazine's Corporate Social Responsibility Awards, and was presented with the highest form of recognition in corporate sustainability – ‘Taiwan Top 10 CSR Excellence Award” – for two consecutive years. FET has also received five awards, including “Best CEO,” “Best Managed Companies,” “Best Investor Relations,” “Best CFO,” and “Best at Social Responsibility,” from FinanceAsia, on top of maintaining Top 5% ranking in ‘Evaluation of Corporate Governance of Listed Companies’ conducted by the TWSE.
In the past year, FET has reaped positive results in terms of corporate governance, customer service, CSR, and business innovations and received countless awards. Besides receiving Gold Medal in Commercial Times’ Service Assessment for five consecutive years for customer service, the Company has also received Grand Prize again in the ‘12th Best Service Award’ hosted by Next Magazine for the telecommunications sector. Besides demonstrating positive consumer recognition for providing thoughtful services, these accolades also prove FET’s dedications to achieving 360° of well-rounded, heartfelt services.

Grasping First-Mover Advantage in Mobile Network through Super Tri-Band; Leading the Industry through Innovative Services
FET is committed to providing innovative communications products and services, and after leading the world in providing a dual-band combination of 700MHz+1800MHz in 4G services, FET has once again launched the only 4.5G Super Tri-Band service of 700MHz+1800MHz+2600MHz in the industry to provide the biggest bandwidth and fastest network quality for its users. At the same time, FET has launched an innovative ‘Direct Carrier Billing Service’ with Google, launched ‘friDay Wallet’ to enter the mobile payment market and construct the largest e-wallet community in Taiwan. Moreover, to solve various 3C problems that customers may have in their daily lives in an IoT era of various network-enabled products, FET has launched the first mobile phone-centric ‘Digital Expert’ technical support service. To efficiently understand the needs of users and consumers to enhance user loyalty and purchase intention, FET has also created the first interactive social community, “Talk.FETnet,” to introduce new knowledge of home-oriented technology to more interested consumers. Furthermore, FET has also expanded its reach into smart home through launching the ‘FET Smart Home’ remote surveillance service, which incorporates home surveillance, caring, and smart life functions. In terms of innovative services, FET has launched “Business Manager” innovative, cloud-based application for SME clients. The telephone, email, and network tools are customized to fit the individual needs of SME clients of varying scales and nature to enhance their competitiveness.

Seeing that IoT has now entered a rapid development phase and may bring forth new types of business models, FET may enter the market from a network-enabled big data analytics and pioneering management model. FET’s President Yvonne Li stated that, “FET’s operational performance has received positive recognition from the capital market. In the past year and a half, our market worth has grown by over NT$30 billion to achieve at NT$251.6 billion, ranking FET as a large-scale corporation at No. 22 in terms of market worth among listed companies. FET will strive to satisfy the needs of 4G Mobility and Real-Time, and will be committed to achieving diversified, integrated services. Through linking high-speed and stable network, quality products, and demassified services, we’ll achieve corporate vision of “FET Connects and Enriches Life.”

2017 marks the 20th year anniversary of FET, and it is also an important milestone for the Company’s continued legacy. The key objectives in 2017 operations will be focused on promoting inter-industry, inter-disciplinary, and inter-zone transformation based on the core advantage of FET’s 4.5G tri-band network. The Company plans to strengthen the vertical integration of ICT system, and develop more diversified and innovative products and smart applications. Moreover, FET is proactively planning to enter the 5G and IoT market and to develop technical application platforms. This will help FET tailored smart products and commercial applications for users to generate higher revenue by effectively understanding customer preferences through data analysis. Moreover, it will also help the Company to provide even better customer experience and innovative application services to astound FET’s broad customer base. Most importantly, FET plans to become the best partner in consumer’s digital lifestyle through maintaining a customer-oriented approach.

(2017/6/23)