By P.R. Venkat
Singapore Telecommunications’ six-month profit rose sharply on a one-off gain from its Indonesia associate, but weak consumer sentiment and inflationary pressures weighed on revenue.
The telecom operator’s net profit for the period ended September rose to 2.14 billion Singapore dollars (US$1.58 billion), an 83% increase compared with a year earlier, the company said Thursday.
The profit was mainly due to a S$1.21 billion one-off gain from a reduction in Singtel’s effective equity interest in its associate Telkomsel.
Singtel said it plans to raise its dividend payout ratio by 10 percentage points to 70%-90% of its underlying net profit.
However, revenue fell 3.0% on year to S$7.03 billion due to a sharp depreciation of the Australian dollar, as well as lower contributions from its Singapore business as businesses held back on spending on information and communications technology amid weak sentiment.
Operating revenue from its Australian unit Optus, which suffered a severe outage Wednesday affecting millions of its subscribers including hospitals and government departments, rose 1.4% on year to 4.02 million Australian dollars (US$2.6 million).
Capital expenditure for the whole fiscal year is expected to be around S$2.1 billion, of which nearly 66% will go towards its Australian business, Singtel said.
Continued currency headwinds are also expected from the strong Singapore dollar relative to the Australian and regional currencies, it added.
Write to P.R. Venkat at [email protected]
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