­China Telecom has posted an 8 percent drop in its profits for the first nine months of this year, as it was hurt by costs of smartphones and network leases rising faster than revenues.

The company said that profits fell by 8 percent to RMB12.6 billion while revenues rose by 15.1% to RMB210 billion (US$33.4 billion). Excluding handset sales, revenues would have risen by 11.1 percent.

EBITDA (before CDMA network capacity lease fees) was RMB73.1 billion, representing an increase of 0.9% over the corresponding period of last year.

The mobile subscriber base rose to 152.6 million, from 117 million a year ago. Of the total customer base, just under 60 million are using 3G phones, and they made up about half of the new subscribers signed up over the past nine months.

Average revenue per customer was flat at around RMB52.7 as higher smartphone revenues were offset by the growth of lower spending rural customers.

The wireline broadband subscribers reached 86.96 million, representing a net addition of 10.15 million.