10:57     PCCW<00008> - Announcement (1)                                      

    The Stock Exchange of Hong Kong Limited takes no responsibility for       
    the contents of this announcement, makes no representation as to its      
    accuracy or completeness and expressly disclaims any liability            
    whatsoever for any loss howsoever arising from or in reliance upon        
    the whole or any part of the contents of this announcement.               
                                                                              
    PCCW Limited                                                              
    (Incorporated in Hong Kong with limited liability)                        
    (Stock Code: 0008)                                                        
                                                                              
    ANNOUNCEMENT                                                              
                                                                              
    The Company announces that on May 12, 2005 it filed the 2004              
    Form 20-F with the SEC in accordance with the requirements of the         
    United States securities laws. In accordance with those requirements,     
    the Company is required to reconcile certain financial information of     
    the Group for the year ended December 31, 2004 included in the 2004       
    Form 20-F to US GAAP, which differs in certain significant respects       
    from HK GAAP, and to include certain information in the 2004 Form         
    20-F that has not previously been announced by the Company for the        
    general information of the Shareholders and public investors.             
                                                                              
                                                                              
    INTRODUCTION                                                              
    The Shares, in the form of ADS, are listed on the New York Stock          
    Exchange, Inc., and the Company is subject to certain filing              
    requirements under the securities laws of the United States. In           
    accordance with those requirements, on May 12, 2005 the Company filed     
    the 2004 Form 20-F with the SEC. In addition, pursuant to the             
    requirements of the United States securities laws, the Company is         
    required to reconcile certain financial information of the Group for      
    the year ended December 31, 2004 included in the 2004 Form 20-F to US     
    GAAP, which differs in certain significant respects from HK GAAP, and     
    to include certain information in the 2004 Form 20-F that has not         
    previously been announced by the Company for the general information      
    of the Shareholders and public investors. Certain financial               
    information contained in the 2004 Form 20-F was prepared in               
    accordance with US GAAP and has been audited by the Company's             
    auditors, PricewaterhouseCoopers. A copy of the 2004 Form 20-F is         
    available on the Company's website at www.pccw.com under                  
    `Investors' and `Financial Results' and at the Company's registered       
    office.                                                                   
                                                                              
    EXTRACTS FROM THE 2004 FORM 20-F                                          
    The following is extracted and summarized from Note 43 to the             
    financial statements included in the 2004 Form 20-F, which sets out       
    the summary of differences between HK GAAP and US GAAP, and the           
    exhibits thereto filed with the SEC.                                      
                                                                              
    Our primary financial statements have been prepared in accordance         
    with HK GAAP, which differ in certain significant respects from US        
    GAAP. The most significant respect of these differences include:          
                                                                              
    (a)                                                                       
    the requirement under US GAAP that upon the first adoption of             
    Statement of Financial Accounting Standards No. 142 on January 1,         
    2002, goodwill on consolidation ceases to be amortized and is tested      
    for impairment on date of adoption, i.e. January 1, 2002, and             
    annually thereafter, or more frequently if events or changes in           
    circumstances indicate that it might be impaired, using the               
    prescribed two-step process;                                              
                                                                              
    (b)                                                                       
    the requirement under US GAAP for identification of certain               
    intangible assets to be determined separately from goodwill based on      
    fair value and the respective amortization over their expected useful     
    lives; and                                                                
                                                                              
    (c)                                                                       
    the requirements for marking to market of marketable equity               
    securities and derivative instruments under US GAAP.                      
                                                                              
    The following table summarizes the adjustments considered necessary       
    to restate profit/(loss) attributable to shareholders to US GAAP          
    giving effect to significant differences between HK GAAP and US GAAP.     
                                                                              
                                                                              
                                                    Year ended                
                                                    December 31,              
                    2004            2003            2002                      
                    HK$ million     HK$ million     HK$ million               
                                                                              
    Profit/(Loss)   1,638           (6,100)         (7,762)                   
    attributable                                                              
    to                                                                        
    shareholders                                                              
    as reported                                                               
    under HK                                                                  
    GAAP                                                                      
    US GAAP                                                                   
    adjustments: