SingTel – TODAY

SingTel Q4 profit up 30% on-year to S$1.29 billion

Telco easily beats analyst forecasts

Surpassing analyst forecasts, Singapore Telecommunications (SingTel) this morning announced that fourth quarter net profit for the Group grew 30 per cent to S$1.29 billion, up from S$991.7 million a year earlier, primarily from an exceptional net tax credit of S$270 million on an increase in value of assets transferred to an associate.

Excluding this and other one-off items, underlying net profit grew 3 per cent, driven by strong mobile revenue growth from Singapore and improved contributions from the regional mobile associates. The stronger Australian Dollar also lifted net profit.

Profit beat the S$966 million average of seven analysts’ estimates, reported Bloomberg.

“We assume both Singapore and Australia achieve 2012 financial year earnings before interest, tax, depreciation and amortisation guidance but only by the slimmest of margins, and with a strong fourth quarter,” Commonwealth Securities said before the earnings report.

For the full year, net profit increased 4 per cent to S$3.99 billion, while underlying net profit declined 3 per cent. Group revenue grew 4 per cent to S$18.83 billion, boosted by mobile growth in Singapore as well as its overseas subsidiries.

SingTel reported yesterday morning that its global mobile customer base had grown 42.9 million, or 11 per cent, to 445 million in the 12 months ending March 31, led by an 19.1-million spike in its Airtel unit in India. the company added about 12 million mobile-phone subscribers in during the quarter.

That number includes customers at six phone companies in Asia and Africa in which the company holds minority stakes, as well as the 13 million mobile subscribers in SingTel’s domestic business and its Australian subsidiary Optus.

“There’s strong demand for handsets, especially the iPhone 4S,” analyst Carey Wong at OCBC Investment Research said before the announcement. “Most people are more and more mobile. You’re not on a computer, you’re on a smartphone or tablet.”

In the fourth quarter, revenue for the group rose 3 per cent to S$4.78 billion, SingTel said in its press release this morning. Ordinary pre-tax earnings from the regional mobile associates grew 6 per cent to S$510 million.

The Singapore company controls around a third of India’s biggest mobile phone operator Bharti Airtel, which this month reported a ninth straight fall in quarterly profit partly due to amortisation and interest costs on its 3G network investments, as well as higher tax provisions.

Bharti’s earnings have been on a downtrend since it paid US$9 billion (S$11.3 billion) to expand into Africa.

SingTel’s Indonesian affiliate PT Telekomunikasi Selular posted a 23-per-cent rise in net profit for the quarter ended in March as growth in data services due to the popularity of smartphones offset its declining voice segment.

Said SingTel group CEO Chua Sock Koong in the press release: “It was a challenging quarter but we kept focused on executing our strategy and met the guidance we had set out. The regional mobile associates turned in marked improvements in their operating and financial performance.”

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