Singtel group profit grows 2% in Q4

telecomasia.net

Singtel lifted its net profit for the fourth quarter by 2% to S$963 million ($692 million), as growth at home and a strong performance at Indonesian affiliate Telkomsel compensated for lower contributions from a struggling Bharti Airtel.

Operating revenue for the quarter grew 5% to S$4.31 million, driven by continued growth in broadband, mobile data and ICT, the company said.

Group consumer revenue grew 7%, with consumer revenue from Singapore increasing 1% and Australian consumer revenue from wholly-owned subsidiary Optus growing 3%.

Group enterprise revenue meanwhile increased 3%, with Singtel's Singapore enterprise business recorded revenue growth for the sixth consecutive quarter. But enterprise revenue from Australia was negatively impacted by price competition.

Pre-tax profits from Singtel's regional mobile associates fell 6% to S$658 million, largely as a result of the 71.7% slump in profit at India's Bharti Airtel during the quarter. As a result Airtel's pre-tax profit contribution fell by 51%.

India's mobile industry has been driven into an annual revenue decline for the first time ever due to intense competition triggered by the impact of Reliance Jio Infocomm's free service introductory offers.

In contrast to Airtel, the pre-tax profit contribution from Telkomsel grew 17% as the operator recorded growth across its voice, data and digital services segments.

“We have turned in a strong set of results this quarter despite a challenging business environment,” Singtel Group CEO Chua Sock Koong said.

“This performance demonstrated the strength of our core businesses and diversified operations, aided by strong cost management. Our investments in networks and spectrum, differentiated content and innovative plans have helped us stand out from the competition and win new customers.”

For the full year, group net profit was flat at S$3.85 billion, but would have grown 2% excluding Airtel's contribution. Operating revenue fell 2% to S$16.71 billion, with earnings impacted by the regulator-mandated decline in mobile termination rates in Australia.

Contributions from regional associates grew 4% to S$2.71 billion, and would have grown 12% excluding Airtel.

Looking ahead to the current financial year, Singtel said it expects a “mid-single digit” growth in consolidated group revenue, despite a projected low single digit decline in mobile communications revenue from Singapore.

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