Business

Published: Wednesday November 14, 2012 MYT 12:59:00 PM

SingTel says second-quarter net profit down 1.6%


SINGAPORE: Singapore Telecom (SingTel) said Wednesday second-quarter net profit fell 1.6 percent year-on-year as it was hit by rising costs and lower revenues from its Australian operations.

Net profit for the July-September period came in at Sg$868 million ($710 million) on revenues of Sg$4.57 billion, down 0.8 percent from the year before, it said in a statement.

Depreciation and amortisation costs rose 8.2 percent to Sg$535 million from Sg$494 million, Southeast Asia's biggest telecom firm by revenue said.

The firm's wholly owned Australian subsidiary Optus is faced with slowing revenue growth due to strong price competition and a government-mandated cut in mobile phone termination rates.

The unit's net profit for the quarter fell 10 percent to Aus$164 million ($171 million), while operating revenue eased 4.2 percent to Aus$2.24 billion.

"In Australia, price competition and reduced mobile termination rates have led to negative mobile industry revenue growth," SingTel said.

"Optus is increasing its focus on customer experience and yield management while restructuring its business model to deliver greater efficiencies."

SingTel said revenues from its Singapore operations rose 4.4 percent to Sg$1.67 billion, while most of its regional mobile phone associates also delivered strong contributions despite depreciating currencies.

Pre-tax earnings from these regional associates jumped 17 percent to Sg$549 million, with Telkomsel of Indonesia, AIS of Thailand and Globe Telecom in the Philippines posting robust operational performances.

This was offset by regional currencies' weakness against the Singapore dollar and lower contributions from India's Airtel.

For the half-year ended September, SingTel's net profit was Sg$1.81 billion, up 0.9 percent.

Revenue for the six-month period dipped 1.2 percent to Sg$9.11 billion.

The company said it will pay its shareholders an interim dividend of 6.8 Singapore cents a share.

SingTel also said that as of end September its mobile customer base across the region rose 11 percent from the year before to 468 million. - AFP

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