Singtel quarterly profit down on lower associate returns, Optus leads 4% sales growth

Thursday 8 February 2018 | 14:07 CET | News

Singtel group reported operating revenue up 4 percent year-on-year in its fiscal third quarter to December to SGD 4.60 billion, and EBITDA rose 6 percent to SGD 1.29 billion. The company attributed the growth to a strong mobile performance at its Australian unit Optus and digital service businesses such as Amobee. 

Lower results in its home market Singapore, higher network depreciation and amortisation from increased infrastructure investments as well as lower earnings from associates like Bharti Airtel, Telkomsel and Globe Telecom impacted the bottom line. Net profit for the quarter was down 9 percent to SGD 890 million. Free cash flow remained strong and grew 42 percent year-on-year to SGD 795 million. 

In Singapore, consumer revenues declined 5.5 percent to SGD 621 million, and EBITDA was down 8.9 percent to SGD 168 million. Mobile data growth and demand for data roaming partially offset the erosion in voice, while equipment sales were affected by delays in popular handset launches and higher demand for SIM-only plans. The end of the Premier League sub-licensing agreement also hurt profits.

Group Enterprise revenue fell 4 percent to SGD 1.62 billion, due to the timing of projects, one-off product sales last year and price erosion in traditional carriage services. EBITDA was stable at SGD 456 million on improved margins from ICT projects and tighter cost controls.

The Digital Life division saw revenue more than double year-on-year to SGD 325 million, and the EBITDA loss narrowed to SGD 14 million despite higher investments in content and technology at mobile video streaming service Hooq. Ad group Amobee was EBITDA positive for a second quarter and delivered robust revenue growth, leveraging synergies from the acquisition of Turn, Singtel said. 

Singtel maintained its outlook for full-year results, for a mid single-digit rise in revenues and low single-digit growth in EBITDA. The company ended the period with a total of 688 million customers including associates, up 3 percent in the quarter. 

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