Good afternoon, welcome to the PCCW 2021 interim results announcement. Joining today are B.G. Srinivas, Group MD, and Susanna Hui, Group CFO. We'll start with a presentation followed by Q&A. With that, let me turn it to B.G.
Thank you, Marco. Good afternoon, and welcome to all of you once again. We will go through the 2021 interim results presentation. 2021, the interim results have been pretty robust for all the core businesses across the PCCW group. HKT delivered its results yesterday, and Susanna has walked you through the details. We will walk you through the financials in a moment. Reflecting on the media business, both the Viu OTT business as well as the free TV business delivered a solid set of results. OTT business continues to demonstrate leadership in Southeast Asia, as you will see from the presentation as we get into details. The free TV business almost doubled its revenues compared to last year's first half. The PCCW Solutions also grew significantly, 51% growth in the first half, on the back of wins of large deals in the last year.
We also see that the fact that both the Viu OTT business as well as the Solutions business continue to expand its footprint regionally in Southeast Asia, and continues to drive the growth momentum. With this, I would like to invite Susanna to walk us through the detailed financials, and I will come back and talk to you in greater detail about the media business and the Solutions business. Over to you, Susanna.
Thank you, B.G. As B.G. has said, we have delivered quite a robust set of performance for the first half of this year. If you look at this slide here, you can see that basically the core revenue improved by 9% from HKD 2.13 billion- HKD 2.3 billion, with corresponding EBITDA up 6% from HKD 692 million- HKD 732 million. On the left-hand side is basically the breakdown of the revenue by each line of business, and just now, B.G. has already covered it. In terms of the EBITDA, we are also pleased to see that EBITDA across the four main lines of business all exhibit improvement over the first half. Maybe I would just go directly into the details for each line of business. Firstly is HKT. I will not spend a lot of time on HKT because yesterday we have already announced the result.
Suffice it to say that revenue was up by 7%, and a lot of the key growth drivers are basically the 5% increase in the local business revenue, strong local data, strong mobile local core revenue, which again benefited from the ARPU uplift, and also enterprise solutions business improved significantly. All of those above. Obviously, we have included the Now TV business as well in the first 6 months, benefiting from Euro 2020 as well. All in all, the HKT EBITDA also increased by 3% to HKD 733 million. On the back of that, we have announced a 2% growth in terms of the AFF yesterday, and also, obviously, PCCW will be benefiting from that as well. Turning to the media business.
The OTT business continued its growth trajectory in the first half of 2021, with revenue increasing by 29% year-on-year from HKD 64 million- HKD 83 million on the back of our dual revenue model. In terms of subscription revenue, it grew by 60% as we strategically moved the premium and original content behind the paywall. Viu paid subscription grew significantly by 62%, from HKD 4.3 million- HKD 7 million. The growth in terms of the subscription mainly came from several key markets, including Indonesia and Thailand. Advertising and related revenue also grew very significantly by 54%, with user base expanding, achieving a 37% year-on-year growth. If we look at the EBITDA contribution, the expanded revenue base obviously narrowed the EBITDA loss from HKD 10 million to HKD 3 million for the first half.
We did see the effect of greater operating scale reaching the inflection point, and we have confidence that the OTT business will be on track to achieve EBITDA breakeven very, very soon. Turning to our free TV business of ViuTV. Our free TV revenue, as B.G. just now also said, it almost doubled from the HKD 17 million- HKD 33 million for the period. In particular, advertising revenue grew 66% to HKD 24 million with a lot of incremental spending from both new and existing advertisers on our multiple platforms. Viewership also expanded, and in terms of the advertising revenue, again, it's increased significantly.
Another highlight for the first half of the year is that our Artists Management and Event business has also experienced very strong growth, spurred by the recent phenomenon rise in terms of popularity of our homegrown talents, in particular, the boy group MIRROR. Therefore, in terms of the EBITDA, again, the EBITDA loss narrowed significantly from $12 million to $6 million. The business is on track to reach profitability in the near future. Turning to our IT solutions business. Total revenue for the first half exhibited very significant growth. It surged by 51%, from $244 million- $370 million. This growth was primarily driven by the successful implementation of various long-term projects, both in Hong Kong and in the region as well. As you can see here, both project-based and recurring revenue show significant growth.
In particular, if you look at the recurring revenue, it increased by 38%, from HKD 185 million- HKD 257 million. This is mainly due to our new wins in terms of the IT outsourcing contracts in Singapore as well as in Hong Kong. There are also other upgrade and extension projects from our existing clients as well. In terms of project-based revenue, it jumped 91% year-on-year from $59 million- $113 million, contributed by completion, implementation of several major projects as well as kickoff of new ones. Our secure orders continue to be strong at $3.2 billion, riding on long-tail contracts in both Hong Kong and Singapore. As announced two weeks ago, we reached an agreement to divest the data center business operating in Hong Kong and Malaysia for a consideration of $750 million.
We expect that the deal will be closed in September or October this year. Looking at the EBITDA of the IT solutions business. For the first half of the year, it more than doubled from HKD 29 million- HKD 63 million, with margin improving significantly to 17%, mainly due to better staff utilization and also rigorous project management and smooth implementation of the various projects on hand. Moving on to the OpEx.
We achieved 8% savings in overall OpEx, which was down from HKD 374 million- HKD 344 million. OpEx revenue ratio improved from 18% to 15%. These are all the combined results of our continued efforts in digitalizing our business processes in-house and also improving our overall operational efficiencies, as well as tight control in terms of effectiveness of the marketing campaigns as well. Turning to the CapEx. Total core CapEx dropped by 5%, from HKD 177 million to HKD 168 million.
If you look at the HKT side, it was more or less stable. The improvement in terms of CapEx mainly came from media and also the solution side in terms of the completion of the data center ramp up. CapEx to revenue ratio correspondingly dropped to 7.2% from 8.3% for the same period last year. In terms of the liquidity and debt position. Overall, the gross debt for the core business was reduced from December last year level to HKD 6.15 billion as at June. While HKT's gross debt increased marginally to HKD 5.5 billion due to seasonal movement in working capital investment, PCCW side saw a lowering of gross debt and net debt to HKD 595 million and HKD 424 million respectively, especially upon the issuance of the perp securities earlier this year.
In terms of liquidity, the whole group have total liquidity of around HKD 2.6 billion, comprising HKD 440 million in cash and HKD 2.2 billion of undrawn bank facilities, split almost equally between HKT and PCCW. Looking at our leverage ratio, gross debts to EBITDA improved to 3.9 times, and net debts to EBITDA was 3.6 times. Moving on to debt maturity profile. The top one was HKT. I don't need to go into details.
The bottom one shows the PCCW debt profile. Again, there is no significant refinancing imminent, especially after the launch of our perp securities earlier this year. Across the group, we have a balanced mix of short-term bank borrowings and longer maturity bonds. The current ratio of the group's fixed to floating rate was kept at around 60/40, and the average debt maturity is around 3.8 years. The effective interest rate was also lowered from 3.4% to 2.8%.
Finally, dividend. The board has today recommended an interim dividend of HKD 0.0936 per share, which represents a 2% growth from last year interim dividend. This ends my presentation on the financials, and will pass back to B.G. for the business.
Thank you, Susanna. Let me walk you through the media business. As was mentioned, the Viu OTT continues to demonstrate leadership in Southeast Asia on the back of a strong content value proposition, as well as the key partnerships we have in the region. We also leverage analytics to bring in and localize content for each of the markets we operate. Combination of all of this, and the fact that we also have a dual revenue stream, has helped us to not only drive growth, but also sustain the growth momentum with increased viewership. This is an assessment by MPA, which is a third-party assessment consulting organization. We see increased competitive activity in the region, particularly in Southeast Asia, all our growth markets. While Indonesia and Thailand demonstrated high growth, the other markets in the region also are continuing to show growth.
We also have seen the fact that Middle East continues to drive attractive streaming video presence, as well as the fact that we are adding more and more content behind the paywall, increasing subscription. As you can see from here, the metrics, we are close to hitting 50 million monthly active users, a fantastic growth of 37% in the first half. The subscription also grew significantly at 62%, and we will continue to strengthen our presence by making sure that the content value proposition is compelling enough for us to sustain this kind of a growth. As you can see here, even the revenue streams, as was mentioned, was pretty robust across subscription as well as the advertisement. The extensive partnership footprint we have in the region is clearly driving some of our momentum growth, particularly with the key telcos, device manufacturers, ad agencies, and the digital distribution networks.
We have a pretty strong set of partners, which makes it much more compelling for not only driving and attracting new subscribers, new monthly active users, but also to continue to sustain this with viewership increasing as well. As I mentioned, our content value proposition is a hybrid. We definitely source some of the best award-winning content in the region across the key language profiles, the Korean, Chinese, Thai drama, Bahasa. At the same time, we have also launched our own Viu Original with some of the independent Korean manufacturers of content, and hence, we are able to de-risk dependency on few sources of content from the region. Switching over to the free TV. As I mentioned, the revenue almost doubled in H1. The ratings also significantly went up.
Again, this was based on some of the award-winning reality shows as well as drama series, which the local teams have been able to produce. We have also attracted a lot of new advertisers to come on board to ensure that not only we are able to drive accelerated growth, but there's a clear attraction for some of these advertisers to leverage Viu platform, given the attractiveness of the consumer base, as well as the fact that it is demonstrating very high growth. We have been able to also distribute our content produced in Hong Kong across other markets through partnerships. During the Olympics, we have also launched several team-based events and programs, which has increased attractiveness to our platform. As was mentioned again, artist management again, has been very successful. Some of these shows and some of these talented artists have won several awards.
We have been able to launch marketing events. We have also done a lot in terms of leveraging synergies and developing new talent on the back of this success. Moving on to the solutions business. We saw robust performance in H1, 51% growth. This was pretty much broad-based across several industry vertical segments. Of course, telecom, public sector continues to be leading in terms of the industry verticals, where there is increased spending. We also saw a jump in the BFSI sector. Hence, we have been able to pretty much broad-base the dependence on several verticals to drive growth. We saw a significant jump in the application development maintenance service portfolio on the back of large outsourcing deal wins as well as new application development in the region.
Our secure order backlog jumped 141%, a pretty healthy backlog for a business of our size, HKD 3.3 billion secure order backlog, which also ensures sustainability of growth momentum in the coming years. Here is a snapshot of the solution footprint we have built for our enterprise customers. Some of these applications, as you can see, play a key role in the smart city development initiatives. The IoT-based smart city lighting, the integrated smart mall platforms, a one-stop community platform. These are some of the solutions we have built which can be replicated across markets where there are a lot of initiatives by the government and enterprises in participating in the smart city development. We also continue to invest in developing our own IP.
This is an example of a platform we have developed for the telecommunication service providers. This is, again, given the fact that most telcos are looking at launching new products and customizing services tailoring the needs on top of 5G rollouts. We see this platform helping the telcos to not only launch new products and improve time to market, but also increased automation and drive costs down. This is a very significant value proposition, which also helps us to compete with the global players in the markets, particularly in the telco vertical. Here are some of the big wins we have had in H1. We continue to not only win new customers, we are also continuing to increase new wins with our existing customers where we have long-term relationships. It also demonstrates the trust and confidence our customers have in entrusting new projects to our organization.
These are some of the wins are not only significant in size, but also these are multi-year contracts, which helps us to generate annuity business. Here is another set of client wins we have had in H1 in Singapore, in Hong Kong, and in Southeast Asia. These are again, wins across different industry verticals, thereby our ability to broad base our growth footprint has helped us to definitely strengthen our presence in some of these key verticals. We are also getting market recognition, both in terms of our innovative solutions in the region for the various industry verticals. Also, the fact that in the last one and a half years, due to COVID, most of our marketing efforts has gone digital as well. Even in that space, we have been able to win marketing excellence awards.
We continue to be recognized by our key partners in tailoring and taking these software solutions to our enterprise customers and helping drive digital transformation. To summarize, again, just to recap, we will continue to stay focused in the key markets we are operating, in the key industry verticals we are focused on, launching new products, making sure we make prudent investments in leveraging opportunities in the region. On the back of 5G, there are new applications which are continuously being launched. Our media OTT business will continue to expand its footprint in the region, in Southeast Asia as well as Middle East. We will continue to make sure we leverage the talent in Hong Kong and drive quality content as a part of our free TV offering.
Our Solutions business, on the back of both project business and the annuity business, will continue to build new solutions and continue to strengthen its footprint in the key verticals and our presence in Southeast Asia and emerge as a regional leader. We see clearly an opportunity to operate and expand our footprint given the fact that both enterprises and the government are significantly focused on their digital footprint to expand its own services, and we are playing a key role as an active partner in this journey. With this, I conclude our presentation. We are happy to take questions. Thank you.
Let's turn to the questions. The first question is a two-part question. When do you think the media business will break even? The second part is, any timeline for the potential IPO of the Viu OTT business?
The media business, there are two parts to it. One is the OTT business specifically. We do hope, given that you've seen in H1 the EBITDA margin narrows and the fact that we are close to breaking even. It could clearly turn profitable in the very near future, maybe in the second half or first half of next year. We clearly see the fact that there is growth potential in Southeast Asia and Middle East. As we continue to build scale, obviously, we are looking at some kind of value creation in either it could be through strategic partnerships and investments or through a potential IPO in the near future.
The next question. What are the plans to further develop the popularity of ViuTV's talent such as MIRROR?
As I mentioned during our presentation, definitely this has given the team a lot of confidence, the fact that we have such good talent in Hong Kong and in the region. We will continue to build on this success. There could be more programs coming in on top of the MIRROR. Of course, the current talent pool, we will continue to use to mentor new talent in the region. You will see newer programs which we are going to launch soon.
The next question is, could you please give us some color on the CapEx outlook for the next few years?
Susan, you want to take it?
Yeah, sure. I think in terms of the overall CapEx, the main chunk would basically be HKT. As we have shared yesterday, in terms of the mobile CapEx, it would be just enriching the coverage. A lot of the 5G coverage has been completed. For fiber rollout, again, yesterday we have shared that the complementing the fiber is the wireless to the home as well, and therefore we do not see a lot of CapEx increase at all in the near term. If we look at the PCCW side, media, again, there is not much CapEx required. In terms of IT solutions, in the past, it is really building up the data center capacity, which would be a significant CapEx. Given the fact that we have started to divest the data center business as we announced earlier on, we will be expecting that overall CapEx will be declining.
The next question is, "Can the strong growth for solutions be maintained for the full year and into 2022?
Definitely. I think for this year, for the full year 2021, as B.G. also shared, we have not just the project revenue, but also the recurring revenue, and we are sitting on a very healthy pipeline in terms of secure orders. All of these are long tails, and therefore for full year, and in fact for next year, we do have confidence that it would be continuously on the uptrend.
The next question is regarding Solutions. Any new geographic markets that it plans to expand into?
As I outlined, we are currently the market leader in Hong Kong. We are expanding our footprint in Singapore, in Southeast Asia, selected markets including Thailand, Philippines, Indonesia. We do have opportunities in mainland China. We don't plan to dilute our focus and expand into several other markets. We'll stay focused on these markets. We will leverage our strength in the key industry verticals, which is more important because that's where we are able to drive differentials in terms of our ability to compete. We will stay very focused on these markets, but clearly make sure that we bring to bear to our enterprise customers in the key industry verticals and the solutions and the IP we are developing, and thereby, showing a strength in the region as a regional player.
That was the final question. Thank you for joining.
Thank you.
Thank you.