Singtel Q1 net profit up 42.9% to $690 million after exceptional gain
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Singtel’s underlying net profit was up 5.4 per cent to $603 million from $571 million the year before.
ST PHOTO: KELVIN CHNG
Chong Xin Wei
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SINGAPORE – Singtel reported on Aug 15 that its net profit for the first quarter ended June 30 rose 42.9 per cent to $690 million, from $483 million in the year-ago period.
The increase was mainly attributed to a net exceptional gain of $88 million, compared with a net exceptional loss of $88 million in the same period in 2023.
The net exceptional gain was from the dilution of Singtel’s effective equity shareholding in associate Airtel from 28.9 per cent to 28.7 per cent. This came after the group redeemed more of Airtel’s foreign currency convertible bonds. Other components contributing to the net exceptional gain are the sale of telecommunication towers by regional associate Globe, as well as a share of Airtel’s exceptional net gain.
Airtel’s gains included a reversal of an interest provision in relation to a variable licence fee matter; a write-back of its share of an associate’s receivable provision for a major customer; and gain from the sale of its wholly-owned subsidiary in Sri Lanka.
Meanwhile, Singtel’s underlying net profit was up 5.4 per cent to $603 million from $571 million the year before. On a constant currency basis, underlying net profit would have risen 8.7 per cent.
This comes amid higher net finance expenses and a lower share of profits from its associates – mainly Airtel and Telkomsel.
Singtel highlighted that in the recorded period, Airtel’s post-tax contribution was lower due to the translation impact from significant currency depreciation in Africa.
Similarly, while Telkomsel reported a higher net profit in local currency terms, its contribution to the group was lower after accounting for the depreciation of the Indonesian rupiah and the reduction in Singtel’s equity interest. Singtel’s first-quarter net finance expenses rose 47.3 per cent year on year to $77 million.
This was due to lower dividend income after the group’s disposal of its 3.9 per cent stake in Airtel Africa in 2023, as well as a one-off revaluation gain from the settlement of a forward contract.
Operating revenue fell 2.1 per cent to $3.4 billion in the first quarter from $3.5 billion, mainly due to the absence of contributions from cyber-security arm Trustwave, which it had sold for US$205 million (S$270.1 million).
In constant currency terms and excluding Trustwave’s contributions, operating revenue would have been stable, led by wholly-owned information technology company NCS and Singtel-owned Australian telco Optus.
Singtel Group chief executive Yuen Kuan Moon said: “Although the macroeconomic environment appears more challenging, we remain optimistic about the growth opportunities across our markets and are well-positioned with the resources and capabilities to capture them.”
Singtel shares closed 3.78 per cent higher at $3.02 on Aug 15 after its business update. THE BUSINESS TIMES
