Singtel full-year profit up 14% on mobile growth, 5G adoption

SINGAPORE – Singtel on Thursday posted a 14 per cent jump in full-year net profit as its core businesses benefited from a recovery in international travel and roaming as well as

rising 5G adoption.

The company also recorded robust mobile growth and price lifts supported by increased demand for information technology and communication services.

South-east Asia’s largest telecom firm said net profit for the year ended March was $2.23 billion, compared with $1.95 billion a year ago. Analysts were expecting $2.26 billion, according to Refinitiv.

Pre-tax profit contributions from its regional associates grew 10 per cent despite currency headwinds, with partly owned Bharti Airtel – India’s No. 2 telecom carrier by subscribers – reporting solid earnings on higher mobile average revenue per user.

Singtel’s Australian unit, Optus, which reported a data breach of up to 10 million customers last October, saw operating revenues gaining 2.8 per cent, with growth across its mobile and fixed voice and data businesses.

Singtel said it expected the group’s core capital expenditure to be around $2.1 billion in fiscal year 2024, adding that it would invest about $500 million in data centres and satellites in the next financial year.

“Our solid financial performance in the second year of our strategic reset reflects the tangible progress we have made against our business priorities in spite of the uncertain macroeconomic environment,” said group chief executive Yuen Kuan Moon.

For the second half ended March, the telco posted a 6.1 per cent rise in earnings to about $1.1 billion from $994.5 million in the year-ago period.

Operating revenue fell 4.2 per cent to about $7.4 billion from $7.7 billion because of the absence of revenue from the migration of Australia’s National Broadband Network (NBN) and contributions from Amobee, the United States digital marketing unit that was sold in 2022. The bottom line was also hit by a 7 per cent depreciation of the Australian dollar.

Excluding the contributions from the NBN migration and Amobee, operating revenue would have been 5.9 per cent higher on a constant currency basis amid sustained roaming recovery, Singtel noted.

Singtel has proposed to pay a final dividend of 5.3 cents per share. Including the interim dividend of 4.6 cents per share, total ordinary dividends come to 9.9 cents per share. This makes for a payout ratio of 80 per cent of underlying net profit.

The company said on Thursday that it remained committed to paying ordinary dividends at between 60 per cent and 80 per cent of underlying net profit.

When the special dividend of five cents per share announced during the half-year results is added, total dividends for financial year 2023 come to 14.9 cents, an increase of 60 per cent over the previous year.

“Our capital recycling programme continued to unlock value this year with more than $2.8 billion raised largely from Airtel, allowing us to strengthen our balance sheet and deliver greater returns for shareholders,” said Mr Yuen. REUTERS