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4Q 2015 Operating Results

Credit Suisse 19th Annual Asian Investment Conference April 6- 7, 2016

TSE: 2412 NYSE: CHT

Disclaimer

STATEMENT REGARDING UNAUDITED FINANCIAL INFORMATION

The unaudited financial information under T-IFRSs in this presentation is preliminary and subject to adjustments and modifications. Adjustments and modifications to the financial statements may be identified during the course of the audit /review work, which could result in significant differences from this preliminary unaudited financial information.

NOTE CONCERNING FORWARD-LOOKING STATEMENTS

This presentation contains forward-looking statements. These statements constitute “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and similar statements. Statements that are not historical facts, including statements about Chunghwa’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Investors are cautioned that actual events and results could differ materially from those statements as a result of a number of factors including, but not limited to the risks outlined in Chunghwa’s filings with the U.S. Securities and Exchange Commission on Forms F-1, F-3, 6-K and 20-F, in each case as amended. The forward-looking statements in this presentation reflect the current belief of Chunghwa as of the date of this presentation and Chunghwa undertakes no obligation to update these forward-looking statements for events or circumstances that occur subsequent to such date, except as required under applicable law.

This presentation is not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration or an exemption from registration. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer or selling security holder and that will contain detailed information about the company and management, as well as financial statements.

SPECIAL NOTE REGARDING NON-GAAP FINANCIAL MEASURES

A body of generally accepted accounting principles is commonly referred to as "GAAP". A non-GAAP financial measure is generally defined by the SEC as one that purports to measure historical or future financial performance, financial position or cash flows but excludes or includes amounts that would not be so adjusted in the most comparable U.S. GAAP measure. We disclose in this report certain non-GAAP financial measures, including EBITDA. EBITDA for any period is defined as consolidated net income (loss) excluding (i) depreciation and amortization, (ii) total net comprehensive financing cost (which is comprised of net interest expense, exchange gain or loss, monetary position gain or loss and other financing costs and derivative transactions), (iii) other expenses, net, (iv) income tax, (v) cumulative effect of change in accounting principle, net of tax and (vi) (income) loss from discontinued operations.

In managing our business we rely on EBITDA as a means of assessing our operating performance. We believe that EBITDA can be useful to facilitate comparisons of operating performance between periods and with other companies because it excludes the effect of (i) depreciation and amortization, which represents a non-cash charge to earnings, (ii) certain financing costs, which are significantly affected by external factors, including interest rates, foreign currency exchange rates and inflation rates, which have little or no bearing on our operating performance, (iii) income tax and tax on assets and statutory employee profit sharing, which is similar to a tax on income and (iv) other expenses or income not related to the operation of the business.

EBITDA is not a measure of financial performance under U.S. GAAP or T-IFRSs. EBITDA should not be considered as an alternate measure of net income or income from operations, as determined on a consolidated basis using amounts derived from statements of operations prepared in accordance with U.S. GAAP or T-IFRSs, as an indicator of operating performance or as cash flows from operating activity or as a measure of liquidity. EBITDA has material limitations that impair its value as a measure of a company's overall profitability since it does not address certain ongoing costs of our business that could significantly affect profitability such as financial expenses and income taxes, depreciation, pension plan reserves or capital expenditures and associated charges. These non-GAAP measures are not in accordance with or an alternative for GAAP financial data, the non-GAAP results should be reviewed together with the GAAP results and are not intended to serve as a substitute for results under GAAP, and may be different from non-GAAP measures used by other companies.

Committed to Improving Shareholder Value

Cash Return

NT$ bn

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45.00
40.00
5.59
35.00
30.00
16.58
25.00
42.6
20.00
37.7
35.9
15.00
10.00 18.5
5.00
0.00
2013 2014 2015 2016
Regular Dividend Special Dividend
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Board of directors resolved to distribute NT$42.6 billion to shareholders

NT$5.4852 per share
payout ratio 99.41%

Note:

1. 1 ADR = 10 common shares

The regular dividend has been calculated based on total share number
7,757,446,545.

Business Overview

Chunghwa Telecom Overview

Strong Market Position[(a) ]

Mobile Performance

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Domestic Fixed

#1 Local

–

94.0% share by subs (11.18 mn subs)
85.7% share by minutes

#1 DLD

82.3% share by minutes
1 Broadband access
75.9% share by subs[ (b)(c) ] (4.50 mn subs)

Mobile

1 Mobile subscribers
38.1% market share[(d)] (11.20 mn subs)
1 Mobile revenue
37.2% market share[(d)(e) ]

Internet

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Mobile market shares continued to grow

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39.0%
38.1%
38.0%
37.0%
37.0%
37.2%
36.0%
35.0% 35.8%
34.0%
14-Nov 15-Nov
Subscriber share Revenue share
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1 ISP
68.3% share by subs (4.20 mn subs)

International Fixed

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#1 ILD

57.7% share by minutes

Source: Company data, MOTC, and NCC statistics a) Market share as of Nov. 2015 b) CHT access circuits were not included

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Accumulating 4.4 million 4G subscribers by the end of Dec. 2015

Population coverage reached 99% for the whole country by the end of 2015

c) Excluding PWLAN subscriber numbers d) Includes 2G, 3G and 4G e) Revenues are based on T-IFRSs .

Number One Mobile Services Provider

Mobile Broadband Spectrum Advantage-3CA Performance

Strategy

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Having the largest 130MHz mobile broadband spectrum

Being able to offer a faster theoretical peak speed via 3CA： 900MHz/1800MHz/2600MHz

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Rolling out 2.6G service in 2Q16 at the earliest to offer best QoE to 4G customers

Focusing on 4G service promotion and mobile internet subscriber expansion

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Enabling load balancing between high/low bands for best QoE

Providing a solid foundation for developing IoT, video and value-added services

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Promoting VAS and new applications
Continuing the migration of 2G customers to 3G/4G network

Highest Subs & Lowest Churn

Mobile Internet Adoption

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Thousand
12,000 3.0%
10,000 2.5%
8,000 2.0%
6,000 1.5%
4,000 1.0%
2,000 0.5%
0 0.0%
J-15 A-15 S-15 O-15 N-15 D-15
CHT TWM FET CHT TWM FET
Subscribers Churn
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Mobile Internet Subs as % of Postpaid Subs

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63.2%
7000 58.0% 60.1% 65%
56.0%
6000 54.1% 60%
5000 55%
4000 5157 5350 5539 5725 5969 50%
3000 45%
Dec 14 Mar 15 Jun 15 Sep 15 Dec 15
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Note : Subscribers with mobile internet plan subscription.

Fixed Broadband and Internet Services

Performance

Strategy

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Broadband Access Revenue
NT$ mn 709 713 710 714 721 ARPU NT$
5,000 4,074 4,136 4,135 4,194 4,289 600
400
2,500
761 730 657 616 581 200
0 0
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
ADSL Fiber
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Note1 : Broadband ARPU is calculated as access plus ISP Note2 : Revenue is calculated based on T-IFRSs

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Leveraging network capability to offer highspeed upload service

Leveraging Big Data capability for precision marketing and precision network construction Leveraging mobile, broadband and Wi-Fi capabilities to offer seamless internet services Expediting CDN construction and OTT promotion to enhance digital convergence product competitiveness

Fixed Broadband Subs

Internet Revenue

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NT$ mn
8,400 14.6%
14.0% 13.4% 12.8%
12.7%
15%
6,600
10%
4,800 6,692 6,218 6,323 6,418 6,817 5%
3,000 0%
Q4 14 Q1 15 Q2 15 Q3 15 Q4 15
Revenue VAS as % of Internet Revenue
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Note : Revenue is calculated based on T-IFRSs

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Thousand
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4,539 4,532 4,515 4,505 4,496
5,000
4,000 867 936 985 1,020 1,054
3,000
2,253 2,244 2,254 2,282 2,304
2,000
1,000
1,419 1,349 1,276 1,203 1,138
0
Dec 14 Mar 15 Jun 15 Sep 15 Dec 15
ADSL Fiber (<100M) Fiber ( ≧ 100M)
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MOD/ IPTV Service

Performance

Subscriber market share (CATV+IPTV) YoY remained at around 20.4% in Q3 2015

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Household TV Usage rate increased to 68.5% from 65.7% YoY for Q4 2015

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thousand
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MOD subscribers

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102.3% 103.0% 104.0%
1,300 97.7% 98.9% 1.1
1.0
1,200
0.9
1,285 1,286 1,289 1,293 1,298 0.8
1,100
0.7
1,000 0.6
Dec 14 Mar 15 Jun 15 Sep 15 Dec 15
Total Subscribers Average Package Subcription per MOD subscriber
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Strategy

Continuing to enrich contents, including movies, drama, TV series for SVOD

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Enhancing both MOD and OTT user interface Leveraging the existing broadband and 4G mobile subscriber base to grow MOD and OTT subscribers

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Leveraging the existing media content position in VOD to acquire OTT contents with all rights across three platforms

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Becoming the leading multi-screen service provider via robust network infrastructures

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800
SVOD subscribers 700
700
600
475
500
400
300 209
200
100
2014 2015
2016（E）
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SVOD ： Subscription Video on Demand

Enterprise ICT Initiatives

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Performance

Information security and cloud service revenue increased 23% YoY in 2015

Personal Cloud (Hami[+] ) subscribers was 3 million till Dec. 2015

IoT service revenue totaled NT$3.3 bn in 2015, a 76.5% increase YoY

Acquired several significant ICT projects in 2015 with contract amount totaling NT$12.6bn

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Strategy

Leveraging our advantage on network infrastructure, IDC, CDN, etc. to expand ICT business

Offering ICT total solutions by integrating our capability on cloud, information security, IoT and customization

Developing in-house big data capability for future commercialization

Cooperating with partners to develop an ecosystem to provide IoT services across various industries

Financials Overview

Financials: Income Statement Highlights

Consolidated	Consolidated	Consolidated	Consolidated	Consolidated
(NT$bn) Q4 2015 Q4 2014	Growth %	2015	2014	Growth %
Revenues 62.22 59.63 4.3		231.79	226.61	2.3
Operating Costs and Expenses 50.84 50.89 (0.1)		181.30	182.44	(0.6)
Income from Operations 11.37 9.41 20.8		50.39	44.80	12.5
Net Income2 9.47 8.07 17.3		42.82	38.62	10.9
Net Income Margin3 (%) 15.72 13.90 -		18.84	17.28	-
EPS 1.22 1.04 17.3		5.52	4.98	10.9
EBITDA 19.60 18.04 8.7		83.84	78.92	6.2
EBITDA Margin (%) 31.50 30.24 -		36.17	34.83	-

Note:

Financials are prepared in accordance with T-IFRSs. Figures for 2015 are unaudited.
Net income attributable to owners of the parent.
Net income margin is based on consolidated net income (including net income attributable to NCI)
The calculation of growth rates is based on NT$mn.

Financials: Business Segment Revenues

(NT$bn) Q4 2015	(NT$bn) Q4 2015	Q4 2014	Growth %	2015	2014	Growth %
Domestic Fixed	19.33	19.60	(1.4%)	72.54	72.06	0.7%
Local	8.23	8.72	(5.6%)	33.57	35.60	(5.7%)
DLD	0.76	0.81	(6.4%)	3.12	3.31	(5.7%)
Broadband Access	4.87	4.84	0.7%	19.34	19.12	1.2%
MOD	0.57	0.70	(18.5%)	2.49	2.57	(3.0%)
Mobile	31.08	28.90	7.5%	114.88	110.67	3.8%
Mobile Voice	10.15	10.41	(2.5%)	41.28	42.70	(3.3%)
Mobile VAS	10.13	9.34	8.4%	39.58	34.77	13.8%
Sales of Mobile Handsets, Tablets and Data Cards	10.58	8.98	17.7%	33.17	32.45	2.2%
Internet	6.82	6.69	1.9%	25.78	26.00	(0.8%)
Internet Services	4.41	4.33	1.7%	17.46	17.24	1.2%
Internet VAS	0.65	0.70	(7.8%)	2.70	2.96	(8.9%)
International Fixed	3.92	3.75	4.6%	15.46	15.31	1.0%
ILD	2.28	2.33	(1.9%)	9.65	10.43	(7.5%)
Leased line	0.43	0.42	2.6%	1.67	1.52	9.6%
Others	1.08	0.69	56.1%	3.15	2.57	22.3%
Total	62.22	59.63	4.3%	231.79	226.61	2.3%

Note:

Financials are prepared in accordance with T-IFRSs. Figures for 2015 are unaudited.
The calculation of growth rates is based on NT$ mn.

Financials: Costs & Expenses

Consolidated	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated
(NT$bn)	Q4 2015	Q4 2014	Growth %	2015	2014	Growth %
Operating Costs 41.83 41.89			(0.1)	148.13	148.38	(0.2)
Operating Expenses 9.01 9.00			-	33.17	34.06	(2.6)
Marketing 6.86 6.86			-	25.06	26.14	(4.1)
General and Administrative 1.15 1.25			(8.7)	4.50	4.41	1.9
R&D Expense 1.00 0.89			12.7	3.61	3.51	3.2
Total 50.84 50.89			(0.1)	181.30	182.44	(0.6)

Note:

Financials are prepared in accordance with T-IFRSs. Figures for 2015 are unaudited.
The calculation of growth rates is based on NT$ mn.

Cash Flow & EBITDA Margin

Consolidated	Consolidated	Consolidated	Consolidated	Consolidated
(NT$bn) Q4 2015 Q4 2014	Growth %	2015	2014	Growth %
Net Cash Flow from Operating Activities 28.47 28.94	(1.6)	75.80	71.38	6.2
CapEx 9.61 11.59	(17.1)	25.08	32.56	(23.0)
Free Cash Flow 18.86 17.35	8.7	50.72	38.82	30.7
Cash and Cash Equivalents at the end of period 30.29 23.56	28.6	30.29	23.56	28.6
EBITDA Margin(%) 31.50 30.24	-	36.17	34.83	-

Note:

Financials are prepared in accordance with T-IFRSs. Figures for 2015 are unaudited.
The calculation of growth rates is based on NT$ mn.
Free cash flow is calculated by subtracting CapEx from Net Cash Flows from Operating Activities.

2015 Operating Results vs. 2015 Forecast

Consolidated	Consolidated	Consolidated	Consolidated	Consolidated	Consolidated
(NT$bn) Q4 2015 (A)	Q4 2015 （E）	Achieving %	2015 (A)	2015 (E)	Achieving %
Revenues 62.22 62.26		99.9	231.79	231.09	100.3
Operating Costs and Expenses 50.84 51.94		97.9	181.30	185.92	97.5
Income from Operations 11.37 10.28		110.6	50.39	45.05	111.9
Net Income 9.47 8.88		106.6	42.82	37.50	114.2
EPS 1.22 1.14		106.6	5.52	4.83	114.2
EBITDA 19.60 18.96		103.4	83.84	80.02	104.8
EBITDA Margin (%) 31.50 30.46		-	36.17	34.63	-

Note : Financials are prepared in accordance with T-IFRSs. Figures for 2015 are unaudited.

2016 Forecast

2016 Forecast	2016 Forecast	2016 Forecast	2016 Forecast
Consolidated
(NT$bn) 2016(E)		2015	Growth %
Revenues	233.49	231.79	0.7
Operating Costs and Expenses	185.53	181.30	2.3
Income from Operations	47.75	50.39	(5.2)
Net Income	39.98	42.82	(6.6)
EPS	5.15	5.52	(6.6)
EBITDA	82.24	83.84	(1.9)
EBITDA Margin (%)	35.22	36.17	-

Note :

Financials are prepared in accordance with T-IFRSs.
The information therein is predictive and will not necessarily be fully realized in the future, and that reference to the company's significant accounting policy and summary of basic assumptions shall be made for further details.

Effective and Efficient Capital Expenditure

Capital Expenditure

NT$ bn

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50
45 15.0% 16.0% 14.4% 20%
13.1%
10.8%
40 36.4
10%
33.3 0.6 32.6 30.6
35 1.6 25.0
30 0.7 2.4 4.6 0.9 1.5 0.8 2.2 0%
3.4 4.4
0.5
25 7.2 9.2 0.9 5.6 -10%
20 9.6 4.8
9.4
15 8.6 -20%
10 19.6 20.4
16.2 -30%
12.6
5 10.2
0 -40%
2012 2013 2014 2015 2016(E)
Domestic Fixed Mobile Internet
Capex
Capex as % of Revenue
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Budgeted capex for 2016: NT$30.6 bn

Continue to focus on core businesses for future investments

4G
FTTx
Service Platforms
IDC/ Cloud

Q&A

AI assistant

Chunghwa Telecom Co., Ltd. — Investor Presentation 2016

52063_rns_2016-09-07_7d0fe058-8f31-47e3-baae-d3205ab8e9b6.pdf

4Q 2015 Operating Results

Disclaimer

STATEMENT REGARDING UNAUDITED FINANCIAL INFORMATION

NOTE CONCERNING FORWARD-LOOKING STATEMENTS

SPECIAL NOTE REGARDING NON-GAAP FINANCIAL MEASURES

Committed to Improving Shareholder Value

Cash Return

NT$ bn

Note:

1. 1 ADR = 10 common shares

Business Overview

Chunghwa Telecom Overview

Strong Market Position[(a) ]

Mobile Performance

Domestic Fixed

#1 Local

–

#1 DLD

1 Broadband access

Mobile

1 Mobile subscribers

1 Mobile revenue

Internet

Mobile market shares continued to grow

1 ISP

International Fixed

#1 ILD

Number One Mobile Services Provider

Strategy

Highest Subs & Lowest Churn

Mobile Internet Adoption

Fixed Broadband and Internet Services

Performance

Strategy

Fixed Broadband Subs

Internet Revenue

MOD/ IPTV Service

Performance

MOD subscribers

Strategy

Enterprise ICT Initiatives

Performance

Strategy

Financials Overview

Financials: Income Statement Highlights

Note:

Financials: Business Segment Revenues

Financials: Costs & Expenses

Note:

Cash Flow & EBITDA Margin

Note:

2015 Operating Results vs. 2015 Forecast

2016 Forecast

Note :

Effective and Efficient Capital Expenditure

Capital Expenditure

NT$ bn

Budgeted capex for 2016: NT$30.6 bn

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Chunghwa Telecom Co., Ltd. Investor Presentation 2016