Singtel Q1 profits down 6.55% to $831.5m

It blamed lower profits at Telkomsel and Airtel.

Singtel’s profits for the first quarter of 2018 fell by 6.55% to $831.5m from $889.8m in the same period last year. According to its financial statement, revenue inched down by 0.5% to $4.13b from $4.16b last year.

The revenue of its Singapore consumer segment grew by 1.7% thanks to higher equipment sales and consumer home services, boosted by pay TV revenue contribution from 2018 FIFA World Cup in June and partly offset by a decline in mobile service revenue. However, earnings dipped by 2.6% after the telco halted its sub-licensing of TV content rights revenue.

Mobile service revenue declined 2.2% mainly from Singapore as the growth in data was offset by lower voice usage due to voice to data substitution.

Data and Internet revenue dipped 1.5% due mainly to decline in NBN migration revenues from the temporary suspension of migrating customers to NBN’s HFC access network in Australia, the slowdown in the maritime industry, and price erosion.

Revenue from ICT fell 3.7% on completion of a major infrastructure project last year as well as decline in Trustwave’s legacy payment card industry (PCI) data security business which is facing commoditisation. Equipment sales grew 14% due mainly to the higher volume of handset sales on continued demand for higher value smartphones.

Including the proportionate share of operating revenue from the associates, the Group’s enlarged revenue declined 4.8% mainly on lower revenues at Airtel and Telkomsel.

Group enterprise’s operating revenue dipped 3.2% due to the “lumpy nature” of major infrastructure projects and continued declines in traditional legacy services, Singtel said. In Australia, Optus recorded growth in the ICT business and mobile partially offset by lower voice.

Meanwhile, group digital life’s (GDL) operating revenue fell by 5.4% due to the timing of marketing spend by certain Amobee’s customers partially offset by higher revenue from HOOQ on the continued ramp-up of its business.

The associates’ post-tax profit contributions fell 26% mainly on lower profits at Telkomsel and Airtel, as well as lower contribution from NetLink NBN Trust following Singtel’s reduction in its economic interest.