A Summary of Singapore Telecommunications Limited’s Latest Results

Singapore Telecommunications Limited (SGX: Z74), or SingTel, is one of the three main telecommunications company in Singapore. The other two are M1 Ltd (SGX: B2F) and StarHub Ltd (SGX: CC3).

The company recently released its 2018 third quarter (3Q FY18) earnings report. In this article, we will look at the positive and the not-so-positive points from its result announcement.

 Source: SingTel’s Press Release

The above is a table from SingTel’s latest press release.

Overall, we can see that revenue was up year-on-year. Yet, underlying net profit was down mainly due to lower contribution from associates’ earnings.

The positives

First of all, group revenue was up 4.4% year- on-year, mainly driven by Consumer and Digital Life segments. The former’s revenue was up 3.1% while the latter’s revenue jumped by 121.9% as compared to last year.

Secondly, group EBITDA (earnings before interest tax depreciation and amortisation) grew 6% year-on-year to S$1.3 billion, driven by improvement in all segments.

Thirdly, free cash flow came in higher at S$795 million, up 42.1% as compared to the same period last year.

Last but not least, net debt stood at S$8.6 billion and gearing was 22.5%. This was an improvement from a year ago when net debt and gearing were S$9.8 billion and 26.7% respectively.

The negatives

First of all, the Enterprise business reported lower year-on-year revenue due to “timing of projects, one-off product sales
last year and price erosion in traditional carriage services”.

Secondly, Singapore Consumer revenue fell 5.5% on declines in voice revenues and Equipment sales, as well as cessation of revenue from sub-licensing of TV content rights.

Last but not least, associate profit contribution was down year-on-year by 17.8% to S$523 million mainly due to the weakness in Airtel, Telkomsel and Globe.

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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.