Singtel profits decline 12%

13 Nov 2008
00:00

SingTel's net profit fell 12% in its second quarter to reach S$868 million ($586 million), due in part to the costs of funding the operator's aggressive iPhone campaigns in Singapore and Australia.

The expensive iPhone rollouts shaved the company's EBITDA from its Singaporean and Australian operations by a combined $46.1 million.

To fight these rising costs, SingTel has instituted a hiring freeze, and is pursuing further cost-cutting measures - but has stated that job cuts would only be enacted as a last resort. Despite the cost-cutting, SingTel still intends to pursue investments in the Chinese and Vietnamese markets.

The company has also attributed the decline to the strong value of the Singapore dollar - bad news for SingTel, which earns about two thirds of its income from its overseas ventures.

But the news wasn't all bad for SingTel - revenue actually increased 5% over the quarter, reaching 2.58 billion. And the bottom line beat the expectations of market analysts surveyed by Dow Jones Newswires, who had on average predicted a net profit of $571 million.

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