Telco Singtel lifted its first-quarter earnings, thanks to an improved performance in Australia and higher contributions from its regional mobile associates.
Earnings rose 12.8 per cent to $942 million for the three months to June 30, while operating revenue inched up 2 per cent to $4.21 billion, mostly because of the weaker Australian dollar. In constant currency terms, operating revenue would have risen 8 per cent.
Singtel issued bonds of US$500 million (S$702.2 million) and A$250 million (S$258.7 million) during the quarter to refinance bank debt and for general funding requirements.
Earnings per share came to 5.91 Singapore cents, up from 5.24 cents a year ago, while net asset value per share was $1.59, up from $1.55 as at March 31.
The company's combined mobile customer base rose 8 per cent to 565 million as at June 30 from a year earlier.
AT A GLANCE
REVENUE: $4.21 billion (+2%)
NET PROFIT: $942 million (+12.8%)
Group chief executive Chua Sock Koong said the telco's regional mobile associates delivered strong earnings because of improved data adoption, and greater 3G and smartphone penetration.
These regional mobile associates contributed $625 million to revenue, up 5 per cent from a year ago.
Chief executive (international) Mark Chong cited Airtel as an example. It has implemented its 4G network in 44 Indian cities, making it the country's first mover in this area. Airtel's revenue of $168 million is 12 per cent lower than a year ago owing to adverse currency movements in its African businesses
"AIS in Thailand has also gained good revenue and market share after it completed its 3G network roll-out," Mr Chong said.
Other subsidiaries are also doing well. Globe in Philippines reported a revenue of $92 million, up 9 per cent, with network improvements delivering greater market share.
In Indonesia, Telkomsel's revenue of $249 million was up 12 per cent, thanks to growth in its voice, data and digital businesses.
More than 70 per cent of Singtel's earnings come from outside of Singapore, so the telco is open to currency fluctuations, said Ms Chua at a results briefing yesterday.
One initiative Singtel has taken is to hedge its foreign exchange against operating risk, she added.
Revenue at the group's consumer business edged up 2 per cent to $2.6 billion as a result of higher mobile data usage and equipment sales, while turnover at the group's enterprise business eased 3.3 per cent to $1.5 billion from a year earlier.
The digital life unit recorded the best growth but from a smaller base. Revenue exploded to $115 million, an increase of 162 per cent from $44 million a year earlier, thanks to increases in social and advertising revenue.
Amobee, the digital marketing arm, signed up three key customers - Australian bank Westpac, automotive company Ford, and cereal and food corporation Kellogg's.
Industry analysts maintained their "buy" rating for Singtel.
Deutsche Bank noted that a 10.6 per cent yearly depreciation in the Australian dollar helped the telco's earnings.
OCBC Investment Research analyst Carey Wong said Singtel's current business should appeal to value investors in times of increased market volatility and potential economic slowdown.