Good morning, ladies and gentlemen. On behalf of Comba Telecom Systems Holdings Limited, I would like to welcome you all for joining today's 2024 Annual Results Investor Presentation video conference. In today's meeting, there will be a presentation followed by a Q&A session. During the Q&A session, you may raise your question to the management by clicking on the raise hand button and wait for further guidance from our moderator.[Foreign language].[Foreign language]. The senior management joining us today are.[Foreign language]. [Foreign language] the Chairman, Mr. Fok Tung Ling [Foreign language] Executive Director and President of the group and President of Comba Telecom Systems International Limited, Mr. Huijun Xu [Foreign language] and Executive Director and Group CFO, Mr. Chang [Foreign language] Now, may I invite Mr. Ken Chang, Executive Director and Group CFO, to present the financial highlights for the year of 2024. [Foreign language] Mr. Chang, please.
Good morning, everyone. First of all, I would give some financial highlights on Comba. Revenue is HKD 4.5 billion in 2024, down by 24.3% compared with a year ago. The decline is mainly due to the slowdown in CapEx globally. Gross profit is HKD 1.17 billion, down by around 30% year- on- year. Gross profit margin is 25.9%, down by 1.9 percentage points. This is due to two facts. One is we actually managed to optimize our asset side, particularly on the inventory side. And second is due to the product mix and due to the decline in overall revenue. Operating expenses is HKD 1.8 billion compared with a year ago. It's kind of flat. However, I would like to point out two points.
First of all, as we also pointed out in our previous announcement, is that we have decided to terminate the A-share IPO, and that actually has incurred the one-off cost in 2024. And that cost is roughly about HKD 160 million. And that actually has got into the 2024 operating expenses. And also, secondly, we have actively managed our sales force and staff size, and we have done the appropriate restructuring on the whole group. So that actually also has involved some of the non-recurring costs. Roughly, it's about HKD 18 million. So with that actually removed, we actually will be seeing our operating expenses on a recurring basis in 2025 to have a much better result. Profit before tax is a loss of HKD 538 million. Income tax is HKD 14.8 million, down by 62%.
Loss to shareholders is HKD 564 million, which compared to the announcement we made on the earnings warning, the earnings are not exceeding HKD 600 million, which is a 9%. Another thing I want to point out is that this time we delayed the announcement of today's earnings by roughly about a week. This is due to the fact that on the Laos accounting side, because Laos as a country has been classified as a hyperinflation country in the fourth quarter of 2024. Due to the accounting principle 29, we actually have to account the hyperinflation on the asset side. Also, we have to adjust the currency appropriately. All in the effect, basically, the impact to our group is actually minimal. On the profit and loss side is slightly positive. Actually, it cut down our loss slightly.
On the asset side, particularly on the net asset side, it reduced the net asset by roughly about HKD 200 million. The goodwill on the Laos operator ETL has reduced by roughly about HKD 150 million. The intangible asset side on the ETL has reduced by also around HKD 150 million. In other words, on the asset side of the company actually become much more optimal and much more healthier for the company to operate in the future. Because the operating expenses have been flat compared with a year ago, and as the revenue has reduced, so as a percentage of revenue of the OpEx has increased. First of all, the finance cost, we have seen a reduced on the finance cost.
However, if we look at the finance cost as a percentage of interest bearing debt, if we look at interest bearing debt itself, it's actually a slight increase, roughly about HKD 850 million at the end of 2024. However, if we look at the finance cost as a percentage, it's roughly about 3.5%-3.7% compared with a year ago, around 7%. So the interest expenses we are paying have been substantially reduced due to a more optimal borrowing structure. Income tax has come down by 62%. Other expenses is a pretty large increase. That is due to a one-off non-recurring cost due to the fact that we have decided not to do the A-share IPO, and that is roughly about, as mentioned, that is the cost come to the other expenses is roughly about HKD 130 million.
And the other HKD 30 million of the IPO-related cost go mainly to the admin expenses. And the admin expenses and selling expenses have come down respectively. Also, as I explained, the IPO cost also come into the admin expenses. But also, we have done the active restructuring of the company that also incurred some of the one-off and non-recurring costs that go mainly into admin expenses and selling expenses. And also, if you look at our annual report in the staff numbers, you actually see a reduction in the workforce. So selling expenses also has come down. And R&D expenses as a percentage of revenue actually has gone up. This actually means our determination to keep on investing on R&D. The net cash, this is the cash reducing the debt, roughly is about HKD 744 million.
If you look at our cash and cash equivalent, it's HKD 1.4 billion compared with a year ago. It's actually an increase from HKD 1.1 billion. Total asset side is HKD 7.4 billion, down by 17.7%, and two notes I want to make is if you look at our inventory, a year ago is HKD 1.3 billion. It actually has come down to HKD 934 million in 2024. It's substantially reduced by 29%. Our account receivable a year ago is HKD 3.5 billion, and now it has come down to HKD 2.5 billion, come down by 27%. So on the asset side, it actually has come down by more than the sell side. So this actually means that also 2024 is the adjustment on the asset side so that the company in a more optimal asset structure to operate in the future. The net asset side has come down by 21% to HKD 2.6 billion.
If we look at the turnover day, although the denominator has come down, however, if you look at our turnover day, it hasn't come down, it hasn't gone up by that much. Inventory turnover day is 123 days. AR turnover day is roughly similar to 2023, 244 days. AP turnover day has lengthened 345 days, and that gives us a cash conversion cycle at 22 days, which I believe is quite healthy in our industry. Operating cash flow, although we have recorded more than HKD 500 million losses, our operating cash flow in recent years has been healthy, and in 2024, it's HKD 339 million. Gross gearing ratio is 11.3%. This is mainly due to the asset side reduction. If you look at our interest-bearing debt, it has slightly gone up, but not that much. It's roughly about HKD 850 million. Debt to asset ratio is 63.5%.
So look at our interest bearing debt and gearing ratio over the last five years. We can actually see that we actually have hit the bottom in 2023 at around 8.8%. It sadly has climbed up to 10.2% in the interim result. At this year end, it's 11.3%. It's still lower than what we have seen five or seven years ago. We believe this structure is still optimal and healthy. Also, if we look at our operating cash flow, we only have one negative operating cash flow over the last 10 years. Although this year lost, we still have a positive on the operating cash flow side. Let's look at our revenue breakdown, first of all, by customer. The three major operators in mainland China account for 30.1% of total revenue.
If we add China Tower into the three operators as a percentage, it's close to 38%. And China Telecom revenue go up by 9.2%. And the others have come down. One major highlight is that our international and core equipment makers in the whole pie right now have gone up to close to 50% of our total pie. And compared with the domestic mainland market, the international market on a relative basis has been more resilient. It has come down by around 8% year- on- year. Others come down by 21.9%. And our Laos operator ETL currently accounts roughly about 4% of total revenue. And even though Laos has depreciated against Hong Kong dollar, in Hong Kong dollar term, the revenue has gone up by 13%. And in local currency term, the revenue has gone up by 32%.
If we look at the loss from ETL, in the recent year, it has substantially reduced. Let's look at the breakdown by business. We see that because due to the slowdown in the CapEx globally, the business on all segments, except the wireless transmission, has come down. If we look at the network system, we see a bipolar performance where domestic PRC market has come down by 37.4%. International market is pretty much flat. International market in the network system represents 44% of the network system. Antenna subsystem come down by 25%. If we look at domestic PRC market and international market, it has both come down by double digits, more than 20%. Also one highlight is that our wireless transmission business in the recent years actually has gone up by roughly about 20%.
Again, in 2024, the business revenue has gone up by 21.1%. I will pass the industry development and strategy to our President of Comba.
Thank you, Mr. Chang. May I now invite Mr. Huijun Xu, Executive Director and President of Comba and President of Comba Telecom Systems International Limited, to present the industry development and company outlook. [Foreign language] . [Foreign language] .
Hello everyone. Good morning. It's a great pleasure meeting you guys here. Following up, I'm going to first discuss about the development trends for the company. Also, we'll go and overview the global wireless network development and the 5G construction in China. Overall, since the year of 2024, we've seen a global telecommunication operator CapEx experience an overall slowdown, both for developing and developed countries, mainly due to the very high interest rates for the majority part of the year.
And 5G developed countries shift from investment focus to network optimization, green energy, AI data center, and computer infrastructures. We've seen there are a lot of investments actually going into AI data center and computer infrastructures, especially for the operator in the massive Chinese market. So the GSMA actually predicts that the global operator CapEx expects to reach 1.5 trillion in the year of 2023. So we'll continue to see growth. But however, the growth rate is not as fast as the beginning of the era of 5G. It will start to see a plateau, and we will see more specific areas for network optimization. So the OpEx to reach approximately four times of CapEx.
This means that the operators will see more stress or more pressures coming up on controlling their OpEx overall, which will drive to the further improvement of the network and service automation, energy efficiency specifically, and carbon reduction to optimize the overall OpEx and reduce the overall running cost of the network. And that's why the group specifically introduced several different products to take care of the operators' OpEx while also lowering their network CapEx as well. So by addressing specific customer application needs to monetize the 5G network deployment, 5G enhancement, and in-depth and extensive coverage, private network, industry applications, and end-to-end integration of cloud network computing. So we have a strategy imperative for overall revenue diversification. So by revenue diversification, you can see that from what we presented before that we heavily focus on the operators' market. This will continue to be our core market.
I'll call it our bread and butter. But moving towards the future, we're definitely diversified towards more enterprise and even consumer markets. So the global wireless network. So the GSMA predicts the number of global independent mobile users' connections will reach 2.3 billion by 2025 and 5.6 billion by 2030, with 5G adoption rising to 56%. And 5G indoor coverage continues to advance with large-scale public infrastructure projects like airports, large venues, stadiums, subways, etc., becoming the primary application for scenarios for 5G digital in-building solutions. So the global 5G private network market also projected to reach 278 million in 2024, with a compounding annual growth rate of 23% from 2024 to 2029, reaching nearly 800 million by 2029. We can see that while we say that the 5G macro deployment is plateau, we see huge opportunities coming up for the private network.
In the year of 2024, which marks the commercial launch of 5G-A, which is driving the 5G network evolution and synergized with explosive AI growth to accelerate the overall industrial application scaling. Meanwhile, the 6G technological breakthrough and standardization are set to begin by 2025. However, we do see a very long tail effect for the existing 5G and even 4G, and I think for 6G, because the standard is not formalized and finalized yet, we expect the launch of 6G will continue to drag on a little bit while we continue to monetize and also optimize for the 5G network. The number of licensed cellular IoT connections is projected to reach 5.8 billion by 2030, supporting smart cities, smart manufacturing, and other fields through 5G local area networks, IoT private network, and edge computing services.
So all these projections done by GSMA, also the analyst group, haven't taken into account the big factors like the robotic growth and also some growth in the drone area, which will continue to drive the fundamental applications of the 5G network. So from our perspective, the demand for 5G and also 5G-A will continue to grow and maybe slightly higher than the analyst body expected. Getting back to China, which is one of the biggest 5G networks that we have so far. By the end of 2024, China will have a total of 12.6 million mobile phone base stations, which includes 4.25 million 5G base stations, accounting for a 33% increase, 4.5 compared to the year of 2023, with a net addition of 874,000 stations.
And 5G investment is progressing steadily and really focusing on deep coverage and enhancing network support for key scenarios with approximately 85% of the overall applications expected to occur indoor by 2025, which means we foresee that the overall macro deployment for China is almost done. But moving forward, there are a lot of network coverage and network optimizations, including rural coverage and also especially in-building for high-density, high-capacity areas that still need to be done, which we have seen for the year of 2024 and also going aggressively in the year of 2025. We also see that in the operators' planning regarding their network optimizations. 5G-A actually brings a lot of opportunities. The new focus is really on the AI applications, cloud computing, IoT, vehicle-to-everything, and drone, and specifically robotic as well. So those become the fundamental 5G or network growth drivers.
The number of licensed cellular IoT connections in China will reach 4.1 billion in 2030. And the integration of the overall cloud network computing in different scenarios will unleash the potential of all these applications. And you can see that for the scenarios that we're listing here, most of those really, really focus on the in-building. And the continued development of 5G private network will see the manufacturing sector leading the Chinese market growth in the Industry 4.0 era. This is also a general trend we see in the global level too. So next one, I'm going to talk about the overall development opportunities for the company given the macro overview, both globally and in the Mainland China. And I'm going to give a very brief introduction of our antenna product and network product as well. And finally, I'm going to close with the overall operating strategies for the company.
So, given the macro environments and also the industry trend that we just discussed just now, what are the development opportunities for the companies? Firstly, the operators will expand the network coverage from extensive to in-depth, which means they move from macro to specific indoor, in-building, high-density areas. This gives us a very, very good position given that our specialties are in-building and also small cells. So, developing countries progressively deploying the transition from 4G- 5G network. So, there are quite a lot of macro 5G network deployment opportunities available globally in different parts of the world. So, our global 5G in-building distribution is also facing an upgrade, especially in developed countries. Operators focus on low carbon, eco-friendly, energy saving, and cost reduction with better efficiency.
As I discussed just now, their total OpEx for the operators after deploying the 5G has significantly gone up, which gives them quite a lot of pressures to control their OpEx overall once the CapEx investment is in. And that's why we develop products that help the operators significantly lower their OpEx and maximize their overall network performance. Fourthly, the integration of the overall cloud network computing and industry intelligence. And especially, I'm going to talk about the 5G plus vertical growth specifically for 5G private network. Firstly, for antenna products, so global operators are initiating the constructions of 5G-A with an overall global demand of BSA exceeding six million units in the next three years.
So we can see that even though China almost plateaued on our overall macro deployment. They are still operators in the developing countries or the operators in the tier two or tier three start to deploy their 5G network. The development of the overall green and low carbon wireless network combined with AI is driving demand for the overall green antennas and smart management feeding system in the 5G-A era. So that's meaning that we developed green antennas specifically for low loss, high efficiency to help the operator to maximize their CapEx or maximize their return on investment on CapEx and lowering their overall OpEx. We can see that the adoptions of green antennas have been widely accepted and adopted globally in both the international market and the domestic Chinese market.
Here we just list a few major operators in markets that have been adopting Green Antenna technology on a global basis. So talking about the product, the new generation of Green Antennas has enhanced the overall energy conversion efficiency of the BSA by 20%. This empowered the operators' clean and low carbon transformation, improving the overall network quality and catalyzed the overall BSA upgrades and replacement demand. Because through a lot of POC that we've done in the year of 2023 with some major operators in Europe, it shows that by adopting the Green Antennas, it not only increased the overall cell coverage for specific stations, but it would also increase the data transmission capabilities on single base station too.
Alternatively, the operator can have another option by tuning down their power consumptions, by lowering their power output of the base stations so that they can significantly control their electricity bills. This idea has been adopted widely, especially in countries in Europe, and also start to become a global trend for all tier one and tier two operators, so for our product, we really focus on sustainable development. Our green product is not solely on by using the product itself, but on the overall product lifecycle too, so the product itself is energy saving and high efficiency, but on the product packaging and overall disposal of the product, we also take into account the overall carbon emission and the energy eco-friendly cycles, so for the antenna product, besides the traditional green antennas that cover only the low band, we also start to have variations to cover both low band and C-band.
We start to see that by adoptions of drones and robotics in wider areas, the coverage of the existing traditional cellular network expands significantly on the air and sea regions too, so we develop green antenna solutions to cover both air and land, sea, and stereoscopic all-scene is in full commercial use, which will bring continuous performance increments and also drive increased demand for these kinds of antennas. Going to network system, this is what we foresee as one of the key growth areas for the coming three years for the company. In the international market, the indoor coverage service steadily increases. We see active expansion into indoor distribution and 5G LTE enterprise private network markets, so this is mainly driven by two factors.
The first one is after the macro deployment of the 5G network, we see more demand going into the indoor and also going into equipment sharing, neutral host, and also high capacity and low latency requirements in in-building scenarios. This definitely drives a lot of in-building coverage solutions, so the neutral host model is gaining traction, especially in Asia-Pac and Americas market, with co-construction and sharing of in-building equipment for the operators because they figured out that's the best ROI investment that they could have and also optimizing their overall network coverage. Our DAS demand remains stable in co-construction and sharing-oriented major venues and infrastructure facilities like major airports and underground tunnel and also big stadiums. Second, private network for 5G has been one of the key drivers for small cell extensions. We've seen that several new frequencies released specifically for private network in different countries.
By this new release of frequencies, that definitely will drive the private network deployment. By enterprise customers specifically, will drive the fundamental demand for the overall small cell extensions. So this is the market I was talking about that goes beyond the operator markets. And 5G LTE private network solutions are being scaled, and experimental network has been established on a global market level. So we see that there are a few very successful private network POC that have been adopted and even commercially deployed in some of the developed countries. So through the year of 2025- 2029, the indoor distribution product market is forecast to sustainable steady investment growth. And we will see some significant growth, especially for small cells. I would say start to speed up starting from the year of 2025 and gaining more traction in the next three years.
And going into international market specifically, we see that this kind of demand is more significant and more prominent in the international market. The global rollout of the 5G license across major economy is continuing to drive the market momentum for indoor coverage upgrades. So with demand expected to grow steadily over the next two years. Of course, we see that start to diverge when we talk about different countries too, depends on when and how the 5G network was deployed on different countries. We see that they start to have different strategies on deploying the 5G network. Overall, the 5G digital active indoor systems have been industry consensus, particularly in highlight application scenarios like large-scale public infrastructure projects. And for macro RAN investments are definitely slowing down on a global level.
Even though we see like here and there, there are still new frequencies being released for the 5G, but on an overall level, we see overall RAN investment slowing down, and while developing nations are in the early stage of 5G investment cycle, for example, this year, we see Vietnam being one of the countries releasing new frequencies for 5G and sustaining growth opportunities for 5G private networks, which rising demand fueled by standardized framework, mature of the ecosystem, and diversification of the application, so we see a more significant growth for the 5G private network in the next three years. For the Open RAN, we start to see in a practical sense, a lot of operators start to use Open RAN more for the rural coverage. For open infrastructure, virtualization are now the industry norm.
For the application side, we see it for more on the high power rural coverage area doesn't require a lot of capacity, but at the same time, they need to complete their coverage commitments to the governments, and with ecosystems expanding into different verticals, especially private networks, so we start to see the Open RAN ecosystem start to evolve from solely focused on macro deployments into private networks to a more specific like small cells and enterprise self-deployed private network. Just a quick touch on the overall Chinese market, so the Chinese market operators and industries benefit from targeted policy-backed initiatives with clear demands for precision network coverage. Comba's all scenario product solutions actually have been and will continue to be the market leader in this specific area.
The signal upgrade, specifically initiatives driven by the operators, by the starting in the year of 2025, will be one of the major driving force for the network system products. We're really focusing on the precise construction needs for the in-depth and extensive coverage to eliminate weak and blind spots for the operators. Because as the network continues to mature in the domestic Chinese markets, they start to look into spots and specifically scenario-based network coverage solutions to cover up all those coverage and capacity holes that they are facing indoors, and because by using a high power dependent rate in-building is no longer an option, so having an in-building solution that will precisely address their capacity and coverage needs. So we're building a highly effective value-added and evolving superior network for customers, which helps clients to signal upgrade.
This will continue to drive the demand for us in the year of 2025 and beyond. Besides that, just now I talked quite a lot about the 5G private network. And we have a complete and quite extensive product portfolio that has been developed and deployed in different vertical industries that include factory, energy plants, electric power plants, coal mining, offshore wind power, and campuses. So by having all those product portfolios, we'll be able to address no matter if we actually provide an end-to-end solution with a 5G core network management, multi-band support, scalable power from high cell from indoor to outdoor, customizable base station. It definitely needs an extensive collaboration with different industry experts and also verticals to build specific modules in order to fit their needs. Besides that, we also have 5G-A passive IoT solutions, which we've been developed with our partners.
This is mainly driven by our capability of being one of the experts in the wireless industry. We've developed these passive IoT solutions to help our customers and our partners to better manage their warehouse and also their fixed assets. This is really a focus on Internet of Everything with an ultra low-cost solution and initiating targeting warehouse logistics and different retail chains with the expanding of broader scenarios. This is one small step that we're going into and exploring for addressing the needs of enterprise customers. For our overall strategy, development is definitely one of our key strategies going forward. We'll continue to deepen the presence in operators' markets and really fully utilize our professional expertise to explore the enterprise and consumer markets, especially on network products.
Secondly, we'll continue to innovate, enhance our R&D capabilities to maintain our industry-leading positions, specifically in wireless industries. Fundamentally, we'll also do some changes, really focus on our resources on projects where will really help us to build up the growth for the next three to five years and also really focus on ourselves and marketing resources in the market that we'll see significant growth both in private network and also in macro. We will continue to operate very lean. Just now, as Chang mentioned, that we've done quite some work in the year of 2024 to reduce the overall management and means cost. We will continue to do that in the year of 2025. We will continue to do the reducing total operating expenditure significantly to boost our overall organization efficiencies.
Because from my perspective, given the era of AI has arrived, there are a lot of digitizations and also optimizations and automations that we can do in order to improve our overall operational efficiencies. So this will continue to be one of our key actions in the year of 2025. And thank you, everyone.