Singtel has reported a 2.3% decrease in group revenue for its fiscal second quarter to S$4.08 billion (2.89 billion), as the company felt the impact of regulatory changes in Australia.
Australian competition regulator ACCC’s decision last year to cut termination rates from 3.6 to 1.7 cents per minute impacted the performance of Singtel’s wholly-owned Australian subsidiary Optus. Excluding this impact, revenue would have grown 2% to S$4.28 billion.
The impact of the rate cut contributed to Singtel reporting an 8% decline in its group consumer revenue, covering both Singapore and Australia. In Singapore, revenue fell 3% due largely to lower handset sales and a rise in penetration of lower-priced Android handsets.
Group enterprise revenue by contrast grew 5% on the back of strong demand for cyber security and international data services.
Net profit fell 6% year-on-year to S$972 million, due to exceptional gains recorded by Indian mobile affiliate Airtel in the previous corresponding quarter.
Underlying net profit by comparison was stable for the quarter and up 3% for the first half of the financial year.
Regional mobile associates’ pre-tax profit contributions grew 7% to S$679 million as a result of strong operating results from Airtel and Indonesia’s Telkomsel. The latter’s pre-tax profit jumped 22% as it reaped the results of investments in its voice, data and digital businesses.
The group’s total customer base – including its mobile affiliates – grew 3% to 629 million subscribers.
Singtel is currently projecting a low single digit decline in group operating revenue but stable ebitda for the full year.
