Singapore Telecommunications (Singtel) has reported a 23.8% growth y-o-y in its net profit of $734 million for the 3QFY2021 ended December, lifted by net exceptional gains from the disposal of the group’s 70% equity stake in Australia Tower Network.

<hr/>See: <a href="https://www.theedgesingapore.com/capital/brokers-calls/earnings-recovery-expected-singtel-3qfy2022" target="_blank">Earnings recovery expected from Singtel in 3QFY2022</a><hr/>

Underlying net profit, however, dipped 0.9% y-o-y to $473 million due to lower operating revenue and EBITDA.

In constant currency terms and excluding NBN migration revenue and JSS credits, EBITDA and EBIT grew 6.1% and 25% respectively driven by the consumer businesses across Singapore and Australia.

During the quarter, the telco’s operating revenue fell 7.7% y-o-y to $3.91 billion on lower NBN migration revenue and equipment sales.

See also: <a class='gtm_see_also_1_inread' style='text-decoration: underline;' href='/capital/results/ntuc-income-reports-premium-growth-fy2021-lower-net-operating-surplus-fair-value?utm_source=website&utm_medium=article&utm_campaign=ONPAGESEO'>NTUC Income reports premium growth for FY2021 but lower net operating surplus on fair value loss</a>

3QFY2021 EBITDA fell 1.7% y-o-y to $990 million.

Underlying EBITDA for the quarter grew 6.4% y-o-y to $982 million excluding the revenue from NBN migration as well as jobs support scheme (JSS) credits.

EBIT before associates’ contributions fell 4.3% y-o-y to $313 million.

Share of associates’ pre-tax profits increased by 15.8% y-o-y to $479 million due mainly to Airtel’s “solid profit turnaround”, which offset the weaker performances from Singtel’s other regional associates.

See also: <a class='gtm_see_also_2_inread' style='text-decoration: underline;' href='/capital/results/serial-system-reports-lower-1qfy2022-earnings-allowance-obsolete-stocks?utm_source=website&utm_medium=article&utm_campaign=ONPAGESEO'>Serial System reports lower 1QFY2022 earnings on allowance for obsolete stocks</a>

Singtel’s Singapore consumer business saw operating revenue decline 5.2% y-o-y to $482 million mainly due to the lower mobile equipment sales revenue on the back of supply constraints.

However, mobile service revenue stood stable y-o-y as the increased adoption of higher ARPU 5G plans and higher roaming from increased international travel were offset by lower voice and decline in prepaid from a shrinking foreign customer base.

Fixed broadband revenue grew as a result of higher equipment sales. Excluding JSS credits of $300,000, EBITDA increased 7.6% due to cost management and some deferred spending.

Australia consumer fell 11.4% y-o-y to $1.68 billion as NBN migration revenue plunged to A$7 million ($6.7 million) from the A$72 million in the same period the year before.

Excluding NBN migration revenue, operating revenue declined 8.7%. EBITDA for the period surged by 20% y-o-y mainly due to continued momentum in the mobile business with service revenue up by 5.1% y-o-y due to the higher penetration of Optus Choice plans.

Australia’s equipment sales revenue fell on lower volume due to stock constraints and weaker retail footfall amid a rising number of Covid-19 cases.

Group enterprise’s operating revenue fell 3.1% y-o-y to $947 million mainly attributable to a decline in its legacy carriage business from lower usage and pricing pressures.

For more stories about where money flows, <a class='gtm_see_also_3_inread' style='text-decoration: underline;' href='/capital/insider-moves/united-hampshire-us-reits-director-goss-raises-stake-oue-steps-share-buybacks?utm_source=website&utm_medium=article&utm_campaign=ONPAGESEO'>click here for Capital Section</a>

ICT revenue was stable as higher data centre and cybersecurity services were offset by fewer ICT deals compared to the same quarter last year.

Group enterprise’s EBITDA fell 3.5% y-o-y due to the lower operating revenue.

NCS saw revenue from its growth engines of Digital, Cloud, Platforms and Cyber up by 11% y-o-y, contributing 49% to the segment’s total operating revenue.

Trustwave reported lower operating revenue and higher losses this quarter following the divestment of its payment card industry compliance business in October 2021.

Associates’ pre-tax profit contribution rose 16% y-o-y due to strong operating momentum in India and Africa, and offset by weaker performance in Telkomsel and Globe amid the global pandemic.

“We continue to see good momentum in Optus’ mobile business in Australia as well as strong growth from our data centre services as enterprises accelerate their digital transformation. Airtel remained the bright spot among the regional associates, demonstrating a sustained profit turnaround with strong performances in both India and Africa,” says Singtel group CEO Yuen Kuan Moon.

“We have been steadfast in executing our new strategy to capture digital growth. Besides focusing on extending our 5G leadership, we are also building new businesses across Asia with our investment in digital banking in Indonesia and collaboration with Gulf Energy and AIS to jointly develop and operate data centres in Thailand as we take our data centre expertise regional,” he adds. “Underpinning these investments is an active programme to recycle capital and crystallise value from our existing assets, allowing us to build out growth drivers for the future and deliver a sustainable dividend to shareholders."

Shares in Singtel closed flat at $2.55 on Feb 14.

Singtel sees 23.8% higher net profit of $734 mil in 3QFY2021

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