A New Era for SUNDAY Communications Limited 2003 Annual Results April 1, 2004

Business Overview Presenter:Bruce Hicks Group Managing Director

SUNDAY + Well managed Profitable SUNDAY = Efficiency Quality Creativity Fully financed and ready for 3G

Net profit of HK$27 million 3G partnership with Huawei Fully financed for future operations SUNDAY – A New Era +

Industry professionals Consistent vision and strategy Strong implementation Well Managed +

Achieved despite difficult environment HK$27 million net profit EBITDA up 47% to HK$315 million EBITDA margin improved from 16% to 25% Profitable – Our Focus for

Subscriber numbers up 9% to 660,000 Churn improved from 5.4% to 5.0% Post paid ARPU down 6.3% to HK$201 Mobile services revenue down 6% to HK$1,150 million Profitable – Our Focus for

Benefit of changes in 2002 Raised efficiency Operating costs ex depreciation down 22% to HK$619 million through major savings in: –Sales commission –Cell site rental –Leased lines –Salary and related Efficiency +

Raised quality standards in: –Coverage –Sales and marketing –Customer care High Quality +

Last 3 years 25% increase in cell sites Coverage now among the best Gaining public recognition High Quality - Coverage +

FMCG approach Organized teams around customer segments More training Employing more quality assurance monitoring High Quality – Sales and Marketing +

New management system More training Superstar hotline and other initiatives High Quality – Customer Care +

Segmentation Innovative Services Creativity – SUNDAY’s Response +

Segmenting by: –Demographics –Usage –Special Interest Requires organizational change Now organised around four segments –Youth –Ethnic –Corporate / business –Mass market –Each segment a separate business unit Creativity – Segmentation +

LBS for Business LBS for logistics and field services LBS for Mass Family Watch SARS updates LBS for Youth Interactive LBS game SUNDAY Wireless roaming services 55% growth in revenues from data services Creativity – Innovative Services +

Efficiency Quality Creativity 2004 – Focus on Revenues +

Ready in 4Q 2004 Huawei partnership Financing provided Flexibility to roll out 3G at right time Manage costs of roll out Ready for 3G +

Build on existing progress in China: –Operations Center in Shenzhen –Partnership with Huawei –Expanding CEPA opportunities – Beyond Hong Kong +

Well managed Profitable SUNDAY= Efficiency Quality Creativity Fully financed and ready for 3G Conclusion +

Financial Overview Presenter:Janet Fung Group Director, Finance

Consolidated Profit & Loss Statement +

 Turned from net loss to net profit of $27 million  Improved by $144 million from 2002 ( HK$ million ) Net Profit +

( HK$ million )  EBITDA improved by $101 million (47%)  EBITDA margin improved from 16% to 25% EBITDA +

 6% drop in mobile services revenue - SARS and price war  5% drop in handset sales mainly - handset subsidy ( HK$ million ) 5% Mobile Services - 6% Mobile Services Turnover +

 4% drop in mobile services gross profit  Improved mobile services gross margin from 82% to 83% - 4% Mobile Services 5% Gross Profit + Mobile Services

 HK mobile market size – 7.2 million or 106% penetration rate  SUNDAY subscribers (excluding MVNO) increased by 9% Total growth rate Postpaid growth rate Prepaid growth rate 29% 9% 1% 43% 9% - 1% 603, , ,000 Subscriber Numbers +

 Churn rate dropped to 3.6% in December 2003  2003 average churn rate was 5.0% Churn - Postpaid + As a % of Opening Subscriber Numbers

 Average ARPU was HK$201  Data was around 7% of ARPU in December 2003 Postpaid ARPU – Net of Discounts & Incentives +

(HK$ million) Consistently Improving Operating Efficiency +

 Reduction of $177 million or 22% 60 (8%) 61 (7%) 86 (11%) 243 (31%) 304 (38%) 42 (5%) 46 (7%) 45 (7%) 270 (44%) 152 (25%) 41 (7%) 65 (10%) -34 (11%) -15 (25%) -21 (24%) -91 (37%) -1 (2%) * Include $26M restructuring costs Operating Expenses +

Headcount – Hong Kong and Shenzhen +

Consolidated Balance Sheet +

Cash and Credit Facilities +

Consolidated Cash Flow +

Fixed Assets Additions +

SUNDAY feels better!