Singtel doubles digital business revenue again

Singtel recorded net profit of SG$890 million and revenue of SG$4.6 billion for the December quarter, with its Digital Life business again doubling in operating revenue.
Written by Corinne Reichert, Contributor

Singtel has revealed that its digital business segment has again more than doubled its operating revenues, bringing in SG$325 million for the quarter to December.

Singtel's "Digital Life" business segment includes digital marketing company Amobee, over-the-top video provider HOOQ, and analytics provider DataSpark, with the revenue jump constituting a rise of 121.9 percent year on year from the SG$146 million recorded in the same period a year earlier.

"Operating revenue for the quarter more than doubled to SG$325 million, driven mainly by contribution from Turn and strong growth in Amobee's media and social revenues," Singtel said.

"[Amobee] now owns one of the strongest demand-side programmatic platforms with an ability to process more than 6 million advertisements per second, augmented by advanced analytics and an extensive ecosystem of partners."

Singtel also launched a brand safety offering during the quarter, labelled the Amobee Inventory Accountability Program, and partnered in an industry-wide study with global publications and Google on fraud and counterfeit detection and prevention. Amobee signed Qantas, Mobil, Southwest Airlines, Honda, and Subaru as customers during the quarter.

Its HOOQ service, meanwhile, won exclusive streaming video on-demand rights to various TV and movie titles.

Singtel's total net profit for the quarter was SG$890 million, down from SG$973 million a year earlier, with earnings before interest, tax, depreciation, and amortisation (EBITDA) of SG$1.29 billion, up 6 percent from SG$1.22 billion.

Operating revenue was SG$4.6 billion, up 4.4 percent from SG$4.4 billion, with consumer contributing SG$2.66 billion, up 3.1 percent, and enterprise SG$1.62 billion, down 3.9 percent.

Singtel also attributed its quarterly results to the success of its Australian business Optus, which reported a total net profit of AU$262 million on revenue of AU$2.33 billion for the quarter after adding 127,000 post-paid customers.

Singtel CEO Chua Sock Koong additionally pointed towards the telco's network investments as improving its value, as demonstrated by its 1.1Gbps 4G demo in December.

"We see our investments in network infrastructure and spectrum as critical to our future growth and longer-term returns in this digital world," she said.

"Already, our transformation strategy is delivering, with digital and ICT services accounting for 23 percent of our revenue this quarter. In our core business, the digitalisation of our services across the group has enabled us to deliver better customer experience and manage costs."

Operating revenue rose across data and internet, which brought in SG$887 million, up 6.7 percent; cybersecurity SG$126 million, up 6.4 percent; sale of equipment SG$683 million, up 4.6 percent; and international telephone SG$117 million, up 0.9 percent.

However, Singtel clocked declines in mobile communications, which brought in SG$1.5 billion, down 0.8 percent due to lower voice revenue and lower-ARPU SIM-only plans; pay TV SG$90 million, down 2.7 percent after "the cessation of a Premier League sub-licensing agreement"; managed services SG$579 million, down 0.7 percent; business solutions SG$147 million, down 16.8 percent; IT SG$726 million, down 4.4 percent; and national telephone SG$234 million, down 11.2 percent.

Singtel added 6,600 post-paid customers and 4,100 prepaid customers during the quarter.

Across Singtel's international telecommunications businesses, Telkomsel contributed SG$248 million in post-tax profit, down 8.8 percent due to increasing competition in Indonesia, while Advanced Info Service (AIS) contributed SG$74 million, up 22.6 percent; Airtel SG$25 million, down 48.7 percent; Globe SG$30 million, down 47.2 percent; and Intouch SG$20 million, up 250 percent.

Singtel also made a SG$35 one-off loss from Airtel during the quarter following the disposal of its operations in Ghana, and SG$25 million in staff restructuring costs, mainly from Optus. Exceptional gains in the quarter included SG$55 million of disputes settlement in Australia.

"Despite the current business headwinds, our regional associates' markets remain attractive with strong mobile data growth," Chua stated.

"The ongoing consolidation in India will also pave the way for a healthier industry. We believe our associates' investments in networks and spectrum, strategic partnerships, and focus on innovation will pay off."

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