Singtel Reports Q2

SINGAPORE -- Singapore Telecommunications Limited (SingTel) today announced that its underlying net profit rose 19 per cent to S$952 million in the second quarter from a year ago, led by robust performance in its Singapore and Australia businesses and strong earnings recovery by Telkomsel.

Ms Chua Sock Koong, SingTel Group Chief Executive Officer, said: “We had another quarter of double-digit growth in the Group’s underlying net profit and this reflects the continued strength of the Group to innovate with differentiated products and services and our agility in responding to challenging market conditions. Our strong financial results were achieved amid a cautious economic climate and despite the negative currency impact.

“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.”

Revenue in Australia grew 7.4 per cent and Singapore by 8.2 per cent, both driven by strong results in the mobile markets with robust growth in customer base. But weaker demand for business-related services impacted the growth of data and voice services for the corporate sector.

On a consolidated basis, the Group’s revenue expanded 5.4 per cent to S$4.10 billion and would have increased 8 per cent if the Australian dollar had been stable from the same quarter a year ago.

Pre-tax earnings from the Group’s regional mobile associates increased a strong 32 per cent to S$571 million, reflecting Telkomsel’s strong performance. Telkomsel registered its third consecutive quarter of market share gain to approximately 51.4 per cent.

The higher contributions from the associates were achieved despite the negative currency translation impact. If the regional currencies had remained stable from a year ago, the Group’s share of the regional mobile associates’ pre-tax profits would have increased 39 per cent.

Net profit rose 10 per cent to S$956 million. Free cash flow for the six months ended 30 September 2009 was S$1.67 billion, comparable to S$1.69 billion in the same period a year ago despite the weakness in the Australian dollar and major regional currencies.

The Board has approved an interim dividend of 6.2 cents a share, an 11 per cent increase from the interim dividend last year. This represents a payout ratio of 52 per cent of underlying earnings, in line with the Group’s dividend policy.

Singapore Telecommunications Ltd. (SingTel) (OTC: SGTJY)