Singapore: Singapore Telecommunications (SingTel) said strong performances in Singapore and Australia helped cushion falling contributions from its Indian operation as Southeast Asia’s biggest telecom firm reported a smaller than expected 2.2% fall in quarterly profit.
SingTel’s Indian associate Bharti Airtel was the spoiler for its third-quarter earnings as the New Delhi-based firm saw its October-December net profit slump 41% on currency losses and a drag from the $9 billion acquisition of the African operations of Kuwait’s Zain.
“Singapore and Australia continued to perform and deliver strong revenue growth and cash flows despite the level of competition in these markets,” SingTel’s CEO Chua Sock Koong said in a statement.
Bharti, in which SingTel has a 32.2% stake, could see improved prospects this year on growth of its African business and launch of third-generation mobile services in India.
SingTel said in Singapore dollar terms, profit before tax contribution from Bharti was down 22% to S$184 million.
The Zain acquisition has weighed on SingTel in the past two quarters. SingTel CEO Chua Sock Koong said in November that the company will take at least another two quarters to restructure the African operation.
SingTel, the biggest company on the Singapore Exchange, recorded an underlying net profit of S$968 million ($759.8 million) in October-December, down from S$990 million a year ago but above an average forecast of S$935.4 million by six analysts.
Revenue at the company, which has a market value of $39 billion, climbed 5.7% in local currency terms to S$4.7 billion in the quarter.
With a domestic market of just five million people and virtually everyone in Singapore owning mobile phone, SingTel has bought stakes in mobile operators in high-growth Asian countries such as India, Indonesia and in Australia to boost its earnings.
At home, analysts say the introduction of a next-generation high-speed nationwide Internet broadband network could provide more challenges, especially in the corporate market.
SingTel shares have risen by 1.3% so far this year, outperforming the 1.2% fall in the broader Singapore market.