8 August 2022 – AsiaInfo Technologies Limited (\u201cAsiaInfo Technologies\u201d or \u201cthe Company\u201d and its subsidiaries (collectively, \u201cthe Group\u201d), stock code: 1675.HK) is pleased to announce the unaudited consolidated interim results of the Company for the six months ended 30 June 2022 (the \u201cReporting Period\u201d).<\/span><\/p>\nDespite COVID-19, revenue growth sustained and increased by 14.5% year-on-year<\/span><\/b>\n<\/p>\nWith the official release of
\n The Plan for Development of the Digital Economy in 14th Five-Year Plan Period<\/i>, digital economy development plans have been issued and implemented rapidly in various regions, and digital technology is being fully integrated into the economy, people’s livelihood and other key areas. Facing the trend of digital transformation in the whole society, in the first half of 2022, guided by the business strategy of \u201cOne consolidation, Three developments\u201d, the overall operating results of the Company maintained a sound growth momentum.<\/span>\n<\/p>\nDuring the Reporting Period, new orders of the Company increased by over 30% year-on-year. The revenue of the Company amounted to approximately RMB3,109 million, up by 14.5% year on year. Among them, the revenue from the Three New Business amounted to approximately RMB1,004 million, up by 81.4% year-on-year, and its proportion to the total <\/span>revenue <\/span>increased to 32.3<\/span>%<\/span>.<\/span>\n<\/p>\nIn terms of profits, <\/span>affected by <\/span>COVID-19<\/span>, the entry, delivery and acceptance of several projects of the Company were delayed, resulting in short-term pressure on profits. Gross profit reached approximately RMB1,054 million, up by 5.6% year-on-year. Excluding the share-based compensation expenses, the net profit amounted to approximately RMB262 million. With the ease of the pandemic in various regions after June, economic activities gradually resumed, driving the sustained and robust order bookings and the improvement of delivery efficiency, and the Company expected to maintain a sound momentum of revenue growth and the net profit is to restore its growth momentum for the full year.<\/span>\n<\/p>\nThe Board, after taking into full consideration of various factors including Shareholders\u2019 returns, profitability, cash flow level and capital needs for future development of the Company, had decided not to distribute interim dividend for the Reporting Period and proposed to maintain the dividend payout ratio guidance of not less than 40% of the net profit for the year 2022.<\/span>\n<\/p>\nThree New Business maintained fast growth with business structure optimized remarkably<\/span><\/b>\n<\/p>\nIn the first half of this year, the Company continued to implement the business strategy of \u201cOne consolidation, Three developments\u201d. While continuing reinforcing its leading position in the Business Support Systems (\u201cBSS\u201d) market, Three New business showed solid growth momentum, and has become the main driving force for the rapid growth of the overall revenue.<\/span>\n<\/p>\nFor the <\/span>DSaaS<\/span> business, the <\/span>C<\/span>ompany completed the acquisition of iResearch<\/span> Consulting<\/span> <\/span>at<\/span> the <\/span>beginning <\/span>of the year<\/span>,<\/span> <\/span>enhancing the <\/span>DSaaS and intelligent decision-making capability<\/span> and optimizing the<\/span> revenue structure. During the first half of the year, the<\/span> proportion of the revenue from industries <\/span>outside the communications industry increased to nearly 40%. Moreover, the <\/span>C<\/span>ompany continued to innovate business models<\/span>. Among them, t<\/span>he results-based and commission-based charging model helped improve customer trust, satisfaction and stickines<\/span>s and was replicated at multiple customers in scale in the <\/span>first half of 2022<\/span>, and its proportion to the revenue of DSaaS <\/span>(excluding iResearch <\/span>Consulting <\/span>revenue)<\/span> increased to nearly 30%. <\/span>During the first half of 2022, the Company<\/span>\u2019s<\/span> DSaaS business achieved a revenue of <\/span>approximately <\/span>RMB484 million, <\/span>up by <\/span>56.<\/span>7<\/span>% <\/span>year-on-year, and its proportion to the total revenue reached <\/span>15.6%.<\/span>\n<\/p>\nFor <\/span>vertical industries and enterprise cloudification, in the first half of 2022, the Company continued its focus on the five strategic industries, widen<\/span>ed<\/span> <\/span>its <\/span>footprint <\/span>in the industries <\/span>of government affairs, energy, transportation, finance<\/span> and <\/span>postal services<\/span>, and achieved significant growth in <\/span>business scale. <\/span>Among them, <\/span>energy and government affairs <\/span>industries <\/span>achieved significant growth in revenue, representing a year-on-year increase of 4.6 times and 1.7 times respectively. In energy <\/span>industry<\/span>, <\/span>the Company promoted replications of <\/span>core solutions such as energy middle <\/span>office <\/span>and 5G private network<\/span> in nuclear power, wind power, thermal power and other markets, supporting <\/span>customers to eliminate potential safety hazards, enhance synergy and operation efficiency. In the government affair <\/span>industry<\/span>, solutions such as government <\/span>affairs <\/span>big data and digital government have become important engines of revenue growth. In the first half of 2022,<\/span> <\/span>thanks to the continuous expansion of new and old customers in the vertical industr<\/span>ies<\/span> and the steady development of cloudification business, the <\/span>Company\u2019s <\/span>revenue <\/span>from <\/span>vertical industries and enterprise cloudification <\/span>business <\/span>amounted to <\/span>approximately <\/span>RMB271 million, representing a year-on-year increase of 140<\/span>.3<\/span>%.<\/span>\n<\/p>\nFor the OSS business, the <\/span>C<\/span>ompany actively support<\/span>ed<\/span> customers to establish an efficient, intelligent, neat and collaborative network operation management system. By improving its R&D and innovation, the <\/span>C<\/span>ompany’s 5G network intelligent products continued to drive the industry. During the first half of the year, with the acceleration of 5G construction in the country, the <\/span>C<\/span>ompany’s OSS business scale grew rapidly and achieved a revenue of <\/span>approximately <\/span>RMB248 million, representing a year-on-year increase of 88.7%.<\/span>\n<\/p>\nFor <\/span>BSS traditional business, the <\/span>C<\/span>ompany actively answered customers’ new demand through technological innovation, deeply participated in the planning and construction projects of smart middle office and digital intelligence-related solutions for the three major telecommunications operators, helped customers achieve digital intelligence transformation, and continued to <\/span>consolidate market leadership<\/span>. In expanding new market, the <\/span>C<\/span>ompany successfully delivered 5G business support system project for China Broadcast Network (CBN), quickly supporting its nationwide launch of 5G service with high-quality customer service, five months after winning the bid.<\/span> <\/span>During the first half of 2022, COVID-19 led to the deferral in orders delivery and inspection, resulting BSS traditional business revenue amounted to approximately RMB2,065 million.<\/span>\n<\/p>\nDriven by <\/span><\/b>R&D<\/span><\/b>, p<\/span><\/b>roduct <\/span><\/b>capability continued to enhance<\/span><\/b><\/b>\n<\/p>\nThe Company always attached great importance to the R&D and continued to strengthen the product capabilities. In the first half of 2022, the Company increased investments in R&D with R&D expenses (excluding share-based compensation expenses) amounting to approximately RMB473 million, representing an increase of 8.7% year-on-year and accounting for 15.2% of revenue. In the first half of this year, the Company continued to intensively participate in 20 international\/ national standards organisations, including 3GPP, ITU, ETSI, IEEE, TMF and O-RAN, etc. In terms of intellectual property rights, the Company added 44 new software copyrights certificates and 9 new patents, and made 50 new patent applications.<\/span>\n<\/p>\nThrough continuous refinement and enhancement of product capabilities, the Company has formed a structure based on \u201cMiddle Office\u201d product system to empower three major product systems of “Digital Intelligence”, “Cloud Network” and “IT”, which has effectively contributed to the rapid growth of Three New Business. In digital intelligent product system and cloud network product system, the Company is at the forefront of the industry. In IT product system, the Company is among the tier-1 domestic vendors. As to middle office product system, the Company has built the foundation for the digital intelligence transformation of the industry.<\/span>\n<\/p>\nAccelerat<\/span><\/b>e<\/span><\/b> <\/span><\/b>b<\/span><\/b>usiness development to <\/span><\/b>a<\/span><\/b>chiev<\/span><\/b>e<\/span><\/b> the goal of 2025<\/span><\/b><\/b>\n<\/p>\nLooking forward, with the continuous strong demands for digital transformation of enterprises that brought by digital economy, the Company will always adhere to \u201cOne consolidation, Three developments\u201d strategy, continue to strengthen the <\/span>consulting & planning, product <\/span>R&D<\/span>, implementation and delivery, system integration, <\/span>smart <\/span>decision-making, data operation, customer service and other <\/span>full-stack digital and intelligent capabilities<\/span>, perfect the close-loop offerings for customers, and unswervingly strive to make solid progress towards the goal of \u201cachieving a business scale of over RMB10 billion in 2025, half of which contributed by the new business\u201d.<\/span>\n<\/p>\nIn terms of Three New Business, the Company will accelerate the business development, further promote Three New Business as the core driver for the rapid growth of the overall revenue. Meanwhile, the Company will deepen business collaboration, especially the intensive integration with iResearch Consulting, so as to create business synergy. For our traditional businesses, the Company will pay close attention to the digital and intelligent transformation needs of telecommunications operators and the development opportunities of new customers, empower customers with innovative and advanced products and solutions, expand the business landscape, and improve the efficiency, thus further solidifying the leading position in the telecommunications operators\u2019 market.<\/span>\n<\/p>\nThe Company is fully confident about the long-term development and<\/span> believes that with the ease of COVID-19 and the improvement of online operation, the<\/span> delivery <\/span>efficiency will be substantially improved <\/span>and <\/span>short-term pressure on profits<\/span> during the first half of the year will be relieved<\/span>. Further, the Company expects to maintain a sound momentum of revenue growth and the net profit will <\/span>restore <\/span>its growth momentum for the full year.<\/span>\n<\/p>\nNote 1: <\/i>T<\/i>