SingTel's Q2 profit up 19% on-year to S$952m
Posted: 11 November 2009 0842 hrs

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SINGAPORE: Singapore Telecommunications' (SingTel) second quarter profit jumped 18.8 per cent year-on-year, but warned of cautious outlook on growth for the current financial year.

In a statement released on Wednesday, SingTel said underlying net profit before goodwill and exceptionals for the quarter ended September was S$952 million, compared with S$801 million in the same period a year ago.

The second successive increase in quarterly profit was mainly due to stronger operating revenue and robust performance from regional mobile associates.

Improved revenues from its domestic market in Singapore, as well as from wholly owned Australian unit Optus were also factors behind the rise in net profit for the July to September period, the company said.

However, the figures fell short of market expectations, with analysts surveyed by Reuters and Dow Jones predicting net profit of above S$956 million.

Revenues during the September quarter grew 5.4 per cent on-year to S$4.1 billion, SingTel said.

Pre-tax earnings from its stable of regional mobile associates increased 32 per cent to S$571 million, with Telkomsel of Indonesia contributing the biggest amount of S$252 million, up 46 per cent from last year.

Contributions from India's Bharti grew 26.4 per cent to S$236 million.

"The group and its associates continued to deliver strong mobile customer growth and now have 273 million customers," said Lim Chuan Poh, chief executive for international business.

SingTel owns substantial stakes in Telkomsel, Bharti and four other regional telecoms operators and the company's investments in these mobile associates are part of its strategy to reduce reliance on the small Singapore market.

In Singapore, where SingTel is the dominant telecom service provider, revenues surged 8.2 per cent to S$1.44 billion from a year ago.

Optus increased its revenues by 7.4 per cent to A$2.22 billion (US$2.07 billion).

Despite the good showing in the second quarter, the company said it is cautious on growth for the current financial year and expects revenue to expand at a single-digit level.

"Our strong financial results were achieved amid a cautious economic climate and despite the negative currency impact," said Chua Sock Koong, SingTel group's chief executive officer.

"Taking into account the results of the group to date and the general improved economic outlook, we now expect that for the current financial year, the operating revenue of each of the Singapore and Australia businesses to grow at single-digit level and EBITDA of the respective businesses to grow at low single-digit level."

- CNA/yb