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General

SingTel's half-year profit plunges 60%, revenue up 3%

Thursday 8 November 2018 | 08:08 CET | News

Singapore operator Singtel saw its operating revenue grow 3 percent year-on-year in constant currency terms to SGD 8.40 billion in the half-year ended 30 September, underpinned by strong postpaid mobile customer growth and higher equipment sales across Singapore and Australia. EBITDA fell 3 percent in constant currency terms, driven by lower NBN migration revenues in Australia, lower voice revenue, as well as investments in the Group’s digital businesses. 

Net profit plunged 60 percent from the same period last year to SGD 1.50 billion, due largely to an exceptional gain from the partial divestment of NetLink Trust. Excluding the one-off items, underlying net profit fell 21 percent, due mainly to lower contributions from Airtel and Telkomsel, and a stronger Singapore dollar against the regional and Australian currencies.

In the regional associates’ markets, mobile data remained the key growth driver, Singtel said. Strong performances from Globe in the Philippines and Airtel Africa mitigated lower contributions from Airtel in India and Telkomsel in Indonesia. Airtel’s results were negatively affected by intense competition and mandated cuts in mobile termination rates in India, although ARPU was stable on a sequential quarter basis. Telkomsel’s earnings were impacted by lower voice and SMS revenues, as well as intense data price competition during the mandatory prepaid SIM card registration period, the company also said. Following the completion of this exercise, Telkomsel implemented price increases in selected areas, which helped drive a 22 percent growth in sequential quarter earnings. In Thailand, AIS’ earnings were impacted by higher depreciation from 4G network expansion.

The group’s free cash flow rose 7 percent year-on-year to SGD 2.14 billion for the half year on higher dividend receipts from associates and lower capital expenditure. The company’s board approved an interim dividend of 6.8 cents per share, representing a payout ratio of 77 percent of underlying net profit for the half year.

In Australia, consumer revenue rose 8 percent for the quarter with growth in postpaid mobile customers and higher equipment sales offsetting lower NBN migration revenues from the temporary suspension of the NBN HFC connections. 87,000 postpaid handset customers were added in the quarter. However, prepaid handset customers decreased by 120,000 as a result of seasonality and intense competition.

In Singapore, consumer revenue rose 5 percent for the quarter. Mobile revenue rose 7 percent on strong equipment sales as premium handset launches were used to drive customer acquisition and retention. Singtel added 41,000 postpaid mobile customers. Home service revenue rose 4 percent boosted by the 2018 FIFA World Cup.

Group Enterprise revenue was down 4 percent for the quarter. Group Digital Life’s revenue rose 10 percent for the quarter, driven by growth in digital marketing arm Amobee’s programmatic platform and email businesses.



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Categories: General
Companies: Airtel / AIS / SingTel / Telkomsel
Countries: Asia / Australia / Singapore
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