Singapore Telecommunications Limited’s Latest Earnings: How Have Its Associates & Joint Ventures Performed?

Singapore Telecommunications Limited (SGX: Z74) is Singapore’s largest operational telco, and it currently has three business segments: Group Consumer, Group Enterprise, and Group Digital Life. In addition, the company also has investments in a number of other telcos around the world: These are classified as associates and joint ventures.

In mid-August, Singtel reported its first quarter results for its fiscal year ending 31 March 2018 (FY2018). The reporting quarter was from 1 April 2017 to 30 June 2017. Since Singtel has three different business segments and the stakes in other telcos, I thought it would be useful to have a look at the performance of the individual parts of Singtel’s business.

In previous articles, I had discussed the results of the Group Consumer, Group Enterprise, and Group Digital Life segments. They are found herehere and here. In this article, I want to study Singtel’s associates and joint ventures.

Results from associates and joint ventures

The table below shows the pre-tax profits from the associates and joint ventures that belong to Singtel for the first quarters of FY2018 and FY2017:

Source: Singtel FY2018 first quarter earnings announcement

We can see that Telkomsel’s profit before tax grew whilst those from Airtel, AIS, and Globe fell. Intouch, which operates in Thailand, was acquired by Singtel in November 2016 (Singtel bought a 21% stake in Intouch), so there’s no year-on-year comparison available. Below are some useful comments that Singtel made about the various companies’ results.

On Telkomsel:

“Telkomsel continued to register double-digit growth in its revenue, EBITDA and net profit. Operating revenue was up 13% year-on-year fuelled by Ramadhan festivities in the current quarter coupled with growth across voice, data and digital businesses.”

On Airtel:

“In India, Airtel’s operating performance continued to be adversely impacted by the new operator’s offering of free voice and disruptive data pricing. Operating revenue fell 10% for the quarter with 14% decline in mobile revenue partly mitigated by growth in non-mobile segments. Data traffic volume almost tripled but data realisation per MB fell 73% on competitive pressures.”


“In the current quarter, AIS’ service revenue (excluding interconnect) increased 7% driven by higher data revenue from mobile postpaid segment and fixed broadband revenue. Data revenue growth was underpinned by attractive handset campaigns and competitive data pricing…

…With higher depreciation charges from network investments and increased spectrum amortisation and financing costs, AIS’ pre-tax profit declined by 28% in Thai Baht terms.”

On Globe:

“Globe’s service revenue grew 6% mainly driven by growth in mobile data services as demand for internet and data connectivity continued to grow.  Globe’s pre-tax profit, however, declined 6% in Philippine Peso terms after including higher depreciation and finance costs from its network infrastructure investments, and higher interest expense related to its acquisition of Vega Telecom, Inc.”

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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 Lawrence Nga doesn’t own shares in any companies mentioned.