SingTel reports net profit down 17.4% in fiscal Q1

14 Aug 2014

Southeast Asia’s biggest telecom firm by revenue Singapore Telecom (SingTel) has reported that net profit tumbled 17.4% year-on-year to SGD835 million (USD668 million) in its first quarter ended 30 June 2014, down from SGD1.01 billion in the year-earlier period, due to ‘the absence of one-time gains and weaker currencies of the countries in which it has key investments’. The group noted that last year’s net profit was bolstered by a one-time gain of SGD150 million stemming from the dilution of SingTel’s stake in Indian associate Bharti Airtel. In a statement, SingTel reported group revenue of SGD4.15 billion, down 3.4% on an annualised basis, although it noted that its share of pre-tax profits from its Asian mobile associates increased by 7.6% to SGD594 million – albeit the rise was limited by a strong Singaporean dollar, which has surged against the currencies of countries where SingTel has major investments. Had currency rates remained constant, SingTel’s pre-tax earnings would have surged 19.9%, it said. EBITDA for the three months ended 30 June fell 3.2% y-o-y to SGD1.254 billion and underlying net profit (defined as net income before exceptional items) was SGD881 million, down from SGD897 million previously.

Commenting on the latest results, the group’s CEO Chua Sock Koong, said: ‘This quarter, the Group reported strong operating results and increased free cash flow … Our regional mobile associates delivered a solid performance.’ The city-state operator has expanded its reach beyond the somewhat limiting local market, and holds stakes in five mobile network operators in the region, namely: Bharti Airtel (India), Telkomsel (Indonesia), Advanced Info Service (Thailand), Globe Telecom (Philippines) and Bangladeshi cellco Pacific Bangladesh Telecom. ‘Their markets are experiencing strong growth, spurred by improvements in 3G networks, handsets and content,’ she said, adding that SingTel is collaborating with its associates to accelerate investments in networks, and launch new data and digital services. SingTel, which also owns 100% of SingTel Optus, the second largest telecom firm in Australia, reported a combined regional subscriber base of 524.951 million, up 10% y-o-y.

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