SingTel – BT
SingTel Q2 profit dips 1.2%
Regional associates drag down group net profit to $882m from $892m
SINGAPORE Telecommunications’ (SingTel) second-quarter earnings disappointed as its regional associates dragged down group net profit 1.2 per cent to $882 million from $892 million a year ago.
Earnings per share eased to 5.53 cents from 5.56 cents.
SingTel, however, managed to grow top line for the July-September period 4 per cent to $4.6 billion from $4.4 billion last year, helped by strong customer growth in Singapore, Australia and other overseas units.
Weakened regional currencies against the Singapore dollar were much to blame for the 12 per cent decline in pre-tax earnings at SingTel’s regional associates to $471 million. Major regional currencies such as the Indian rupee and Indonesian rupiah slid between 5 and 9 per cent against the Singapore dollar.
In constant currency terms, the decline would have been less severe at 6 per cent.
SingTel’s associates increased their proportionate contributions to group turnover by 4.4 per cent to $2.78 billion from $2.66 billion last year.
Pre-tax profit at Bharti Airtel, which operates in South Asia and 17 African countries, was the worst performer, falling 37 per cent y-o-y to $131 million.
Its Indian operations were hit by 3G costs and higher interest expenses.
Meanwhile, the floods in Thailand have not affected SingTel’s Thai associate Advanced Info Systems (AIS), said Hui Weng Cheong, SingTel’s CEO International. Affected base stations are ‘getting back on track’ and telecomms usage has increased during the flooding, he said.
In its home territory, revenue was flat at $1.6 billion, as only the mobile business of the four units grew. The mobile business grew 9 per cent y-o-y to $477 million from $437 million on the back of strong customer growth. SingTel scored a consecutive quarter of market share gains and now commands 45.5 per cent of the mobile market here.
Where faster Long-Term Evolution (LTE) mobile networks are concerned, SingTel’s CEO Singapore Allen Lew said that SingTel intends to explore a different pricing strategy from that of 3G.
However more details would be delivered in a month’s time, he said.
‘I think we are going to try for LTE to change the game in terms of how we price data,’ said Mr Lew.
‘Certainly, we don’t want LTE to go the way of 3G where there’s unlimited data and people giving us feedback about inconsistent speeds.’
SingTel also said that its long-term strategy of upping its stake in associates remains unchanged. It increased its holding in AIS by 2 per cent in early November for $328 million.
‘In other associates, if there are stakes available, we are definitely prepared to get in on the right terms and conditions,’ said Chua Sock Koong, SingTel group CEO.
SingTel ended yesterday two cents up at $3.18.
SingTel – BT
SingTel Q2 profit dips 1.2%
Regional associates drag down group net profit to $882m from $892m
SINGAPORE Telecommunications’ (SingTel) second-quarter earnings disappointed as its regional associates dragged down group net profit 1.2 per cent to $882 million from $892 million a year ago.
Earnings per share eased to 5.53 cents from 5.56 cents.
SingTel, however, managed to grow top line for the July-September period 4 per cent to $4.6 billion from $4.4 billion last year, helped by strong customer growth in Singapore, Australia and other overseas units.
Weakened regional currencies against the Singapore dollar were much to blame for the 12 per cent decline in pre-tax earnings at SingTel’s regional associates to $471 million. Major regional currencies such as the Indian rupee and Indonesian rupiah slid between 5 and 9 per cent against the Singapore dollar.
In constant currency terms, the decline would have been less severe at 6 per cent.
SingTel’s associates increased their proportionate contributions to group turnover by 4.4 per cent to $2.78 billion from $2.66 billion last year.
Pre-tax profit at Bharti Airtel, which operates in South Asia and 17 African countries, was the worst performer, falling 37 per cent y-o-y to $131 million.
Its Indian operations were hit by 3G costs and higher interest expenses.
Meanwhile, the floods in Thailand have not affected SingTel’s Thai associate Advanced Info Systems (AIS), said Hui Weng Cheong, SingTel’s CEO International. Affected base stations are ‘getting back on track’ and telecomms usage has increased during the flooding, he said.
In its home territory, revenue was flat at $1.6 billion, as only the mobile business of the four units grew. The mobile business grew 9 per cent y-o-y to $477 million from $437 million on the back of strong customer growth. SingTel scored a consecutive quarter of market share gains and now commands 45.5 per cent of the mobile market here.
Where faster Long-Term Evolution (LTE) mobile networks are concerned, SingTel’s CEO Singapore Allen Lew said that SingTel intends to explore a different pricing strategy from that of 3G.
However more details would be delivered in a month’s time, he said.
‘I think we are going to try for LTE to change the game in terms of how we price data,’ said Mr Lew.
‘Certainly, we don’t want LTE to go the way of 3G where there’s unlimited data and people giving us feedback about inconsistent speeds.’
SingTel also said that its long-term strategy of upping its stake in associates remains unchanged. It increased its holding in AIS by 2 per cent in early November for $328 million.
‘In other associates, if there are stakes available, we are definitely prepared to get in on the right terms and conditions,’ said Chua Sock Koong, SingTel group CEO.
SingTel ended yesterday two cents up at $3.18.
StarHub – DBSV
Cash generation exceeds dividend commitments
At a Glance
• 3Q11 net profit of S$76m (-8% YoY, -3% QoQ) was 11.6% below our estimate due to higher costs. Declared 5 Scts DPS as expected
• Management guided for absence of cash tax in 2011F and minimal cash tax in 2012F, implying free cash flow will exceed earnings.
• Maintain BUY with DCF based TP (WACC 7.6%, terminal growth 0%) of S$3.05 for 7% yield and relatively resilient earnings.
9M11 net profit of S$223m (+22% YoY) made up 72% of our previous full year forecast. Operating expense of S$479m in 3Q11 was flat sequentially but higher than expected due to: (i) Equipment cost declined only 4% QoQ, while we had expected significant decline assuming lower take-up for iPhone plans before iPhone 4S launch. Instead StarHub re-contracted many of its customers whose two-year contract expired in 3Q11. (ii) Staff cost rose by 2% QoQ to S$70m instead of declining sequentially as temporary staff continued to work on single billing system and other initiatives. In view of margin pressure in 4Q11F due to iPhone 4S launch, we trim our FY11F earnings projections by 5% to S$295m, still up 12% YoY.
Free cash flow generation was the key positive. 9M11 free cash flow per share reached 24 Scts, higher than annual commitment of 20 Scts DPS. Management guided for zero and minimal cash tax in 2011F and 2012F respectively on account of certain group losses and capex related allowances. Management revealed that dividend paying entity has enough reserves to fund the dividends.
Pay TV subscriber decline & absence of gains in corporate business were key negatives. Pay TV subscriber base declined by 2K to 542K in 3Q11 offsetting the gains made in 2Q11. This can be attributed to StarHub ending certain price promotions. Most importantly, pay TV revenue was up 1% QoQ as ARPU improved slightly. Corporate business was stable QoQ as StarHub faced issues in accessing the customers, which regulator is currently looking into.
SingTel – BT
SingTel gets more cellphone customers
Increase is due to fast-growing mobile phone market in Africa, South Asia
THE fast-growing mobile phone market in Africa and South Asia has driven Singapore Telecommunications’ total mobile customer base to 424 million as at Sept 30, a 15 per cent increase from last year’s 368 million.
SingTel associate, Airtel, added 39.3 million new customers in South Asia and Africa.
Its total subscriber base is 227 million, with 173 million from India alone.
It also managed to grow its subscriber base in Africa by 21 per cent or 8.4 million people. It expanded into the fastest-growing African country, Rwanda, in the third quarter, offering 2G and 3G mobile services there.
Globe Telecom Inc, SingTel’s joint venture with Ayala Corp in the Philippines, yesterday announced it will spend US$790 million to upgrade its network and technology systems to expand its footprint and cut costs.
Its mobile customer base as at Sept 30 was 29 million, up 15 per cent from 25 million last year.
Globe’s ‘biggest and most significant investment’ in 20 years will help it meet an anticipated increase in voice and data demand and to ward off competition from market leader Philippine Long Distance Telephone.
PLDT last month wrapped up the US$1.7 billion purchase of Digital Telecommunications Philippines, which gave it 70 per cent control over the domestic mobile phone market.
Globe will spend US$700 million over the first five years to give its network a facelift and the remaining US$90 million to re-engineer its IT systems over two years.
Globe will most likely sell US$550 million and US$600 million of bonds in the next six to eight months to fund the investment.
SingTel will be announcing its second quarter results today.
StarHub – BT
StarHub’s Q3 net profit declines 7.6% to $75.8m
But operating revenue increases 3.6% to $572.2m
STARHUB’S third-quarter net profit fell 7.6 per cent to $75.8 million from $82 million a year ago.
Earnings per share for the three months ended Sept 30 dipped to 4.42 cents from Q3 2010’s 4.78 cents.
At the same time, Singapore’s second largest telco grew operating revenue by 3.6 per cent to $572.2 million, from $552.3 million.
StarHub saw turnover edge up slightly at three of its four business segments during the quarter, except in fixed network services.
Mobile revenue, which makes up more than half of StarHub’s topline, rose 3 per cent to $307.4 million from $298.3 million.
Pay-TV and broadband services also grew turnover by 1 per cent and 3.3 per cent, respectively, to $93.4 million and $60.2 million.
StarHub has scored 5,000 new Pay-TV customers since Q3 2010, but lost 2,000 customers since the last quarter due to the conclusion of a three-month promotional period.
It also added 26,000 more broadband customers since Q3 2010.
Fixed network services was the only segment where revenue declined, slipping 4 per cent to $81.7 million from $85.1 million.
StarHub enjoyed higher equipment sales during the July-September period, taking in $29.5 million, a 62.6 per cent increase from $18.2 million last year.
It chalked up the increase due to a higher mix of smart phones and tablets which had higher selling prices.
StarHub announced an interim dividend of 5 cents per share.
The telco maintained its full-year outlook that revenue growth will be in the low single-digit range and Ebitda margins on service revenue will be about 30 per cent.
In an update on the demand for Next-Generation Nationwide Broadband Network (NGNBN) work services, StarHub said it has seen low corporate take-up in part because of delays in provisioning.
‘There is strong demand from our customers but corporate take-up of NGNBN has been slow because of how it has been rolled out,’ said StarHub CEO Neil Montefiore in a conference call yesterday.
There have been difficulties in accessing commercial buildings, explained CFO Tan Tong Hai.
And even when fibres have been laid, they may not work – a turn-off for many corporate customers which prize timeliness and quality of service, much more than residential consumers do.
StarHub is currently in talks with various parties on how to iron out the operational roadblocks.
StarHub ended trading yesterday down two cents at $2.86.