China Tower adjusts the depreciation period for its indoor assets to 10 years, expecting a reduction in annual depreciation of RMB 870 million

China Tower (00788.HK) announced that in order to more objectively and fairly reflect the useful life of fixed assets and the actual usage of assets, and to improve the quality of accounting information, it will adjust the depreciation period of indoor distribution assets from 7 years to 10 years starting from July 1 of this year.

The company explained that as the domestic technology standards in the indoor distribution equipment field continue to improve, core performance indicators such as signal coverage strength, network capacity, equipment stability, and compatibility have significantly enhanced, further extending the actual usage cycle and value retention duration of indoor distribution assets. Continuous optimization also provides effective assurance for the extended service life and long-term reliability of indoor distribution equipment.

The adjustment of the depreciation period will be processed using the prospective application method, with no need for retrospective adjustments. China Tower believes that this will not affect the previously disclosed financial reports. Based on the unaudited indoor distribution assets as of June 30, 2025, and calculated according to International Financial Reporting Standards, it is expected that this change in accounting estimate will reduce the depreciation expense of indoor distribution assets by approximately RMB 870 million for the fiscal year 2025