Singtel earnings down as group adds another 30 million mobile subs

Singtel has announced a quarterly net profit of SG$832 million, down 6.6 percent, on operating revenue down 0.5 percent to SG$4.1 billion as it revealed losing 47,000 Singaporean mobile customers over the past year.

Earnings before interest, tax, depreciation, and amortisation (EBITDA) for the first quarter were down 2.7 percent to SG$1.2 billion, with overall operating revenue from mobile down 2.2 percent to SG$1.4 billion, mainly due to its Singapore services.

As of June 30, Singapore's incumbent telecommunications carrier had 4.1 million total mobile customers -- of these, 1.6 million customers were prepaid, down by 5.7 percent year on year, and 2.5 million were post-paid customers, up 2.1 percent.

Average revenue per user (ARPU) rose from SG$45 to SG$46 over the quarter in post-paid, and remained at SG$18 in prepaid. Singtel had an overall Singaporean mobile market share of 49.2 percent, up from 48.8 percent a year ago.

Across the Singtel Group, however, Airtel added 75 million customers during the year for a total customer base of 438 million -- 344.6 million in India, 91 million in Africa, and 2.3 million in South Asia. In Telkomsel, Singtel lost 113,000 customers for a total of 177.9 million; in AIS it lost 379,000 customers for a total of 40.1 million; and in Globe it added 5.4 million customers for a total of 65.1 million.

Across its entire group, Singtel had 735.4 million mobile customers -- including the 10.2 million on Optus in Australia -- up from 706 million at the end of last quarter.

Singtel had a fibre broadband market share of 46.8 percent in Singapore, with 606,000 total fibre broadband lines after adding 7,000 customers during the year.

Singtel's Group Consumer brought in operating revenue of SG$2.4 billion during the quarter to June 30, up 1.9 percent -- however, according to the company, revenue would have increased by 2.7 percent if not for the National Broadband Network (NBN) cease-sale on hybrid fibre-coaxial (HFC) in Australia.

Across Singapore, the consumer segment brought in SG$547 million in revenue, up 1.7 percent: SG$265 million from mobile services, down 3.8 percent; SG$105 million from sale of equipment, up 5.5 percent; SG$65 million from residential pay TV, up 13.6 percent thanks to FIFA World Cup subscriptions; SG$59 million from fixed broadband, up 4.4 percent; and SG$33 million from fixed voice, down 2.4 percent.

Singtel also dropped 17,000 Singtel TV customers during the year, with 387,000 total customers as of June 30, while ARPU rose from SG$41 to SG$44 thanks to the FIFA World Cup subscriptions.

In total, the Singtel Group's pay TV revenue was up 12.1 percent year on year to SG$104 million.

For Group Enterprise, Singtel made operating revenue of SG$1.5 billion, down 3.2 percent. Managed services were down 5.9 percent to SG$539 million -- with cybersecurity down 3 percent to SG$114 million -- business solutions were up 5.8 percent to SG$140 million; IT was down 3.7 percent to SG$679 million; data and internet were down 3.9 percent to SG$405 million; mobile services were down 3.9 percent to SG$202 million; fixed voice was down 9.4 percent to SG$124 million; and sale of equipment was up 17.3 percent to SG$91 million.

"Group Enterprise's operating revenue fell 3.2 percent on completion of a large infrastructure project last year and continued declines in traditional legacy services, especially voice," Singtel said.

"Cybersecurity revenue was stable in constant currency terms. The cybersecurity business in the Asia Pacific region maintained its momentum and achieved strong double-digit growth. However, overall cybersecurity revenue was impacted by lower sales in the United States due to commoditisation in the traditional payment card industry (PCI) compliance business and price competition."

Group Digital Life operating revenue was down 5.4 percent to SG$259 million, though Singtel pointed to Amobee's acquisition of Videology assets in July.

Singtel CEO Chua Sock Koong cited "intense competition and increasing business headwinds" for the quarter, with the company also looking towards 5G for future business.

"The group has established a 5G Centre of Excellence in Singapore, and aims to prepare for the communications ecosystem for 5G services as standards are progressively introduced," Singtel said.

"Singtel will launch Singapore's first 5G pilot network later this year."

Last month, Singtel and Ericsson said they are readying the launch of a pilot 5G network at the end of 2018 in the One-North district in Buona Vista to facilitate drone and autonomous vehicle trials.

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