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3 Key Slides Singapore Telecommunication Limited Investors Should See

Singapore Telecommunications Limited  (SGX: Z74) is the largest listed company in Singapore and one of the largest telecommunications companies in Asia.

Those living in Singapore may be familiar with the company’s mobile services. Singtel’s business can be divided into three major divisions, namely Group Consumer, Group Enterprise, and Group Digital Life.

The telco had its annual general meeting (AGM) last month. The following are three slides from the meeting’s presentation that investors shouldn’t miss.

An Asian empire

Singtel may be ever-present in Singapore, but its business stretches beyond the Lion City’s shores.

2016-08-01 Singtel Network
Source: Singtel’s earnings presentation

The Singtel footprint stretches across 600 million mobile customers in Asia, Australia, and Africa. From the slide above, we can see that Singtel has stakes in multiple telcos around Asia. It’s worth noting that these Asian telcos all hold strong positions in their respective countries. For instance, Telkomsel is considered the number one telco in Indonesia while AIS is also number one in Thailand. All these fall under the Group Consumer division.

The Group Consumer division is the largest within the telco, accounting for 60% of Singtel’s revenue in the fiscal year ended 31 March 2016 (FY2016).

Singtel also has a broad enterprise offering. This includes services such as cybersecurity, cloud computing, and data centres. The Group Enterprise division contributed 38% of Singtel’s revenue in FY2016.

Elsewhere, the Group Digital Life division is the smallest, making up around 2% of Singtel’s total revenue. This division houses early stage businesses that are involved in areas such as mobile marketing (Amobee),  mobile streaming (HOOQ), and more.

Dividends, dividends, dividends

Singtel has been a steady payer of dividends for many years.

2016-08-01 Singtel Dividend
Source: Singtel’s earnings presentation

Over the last five years, Singtel has paid out a total of $0.844 per share in dividends. The company’s dividend payout in those years represent 68% to 74% of its underlying earnings per share (EPS). Moreover, Singtel’s dividends have been paid out using its free cash flow alone in four out of the last five years.

A long-term market-beater

The steady trickle of dividends does add up.

2016-08-01 Singtel Performance
Source: Singtel’s earnings presentation

Singtel has recorded a five-year total shareholder annualised return of 10.3%. This trumps the Straits Times Index’s (SGX: ^STI) negative return over the same period.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore contributor Chin Hui Leong doesn't own shares in any company mentioned.