SingTel announces lowest profit in over 20 years
Lee Kah Whye May 31st Singapore (ANI): Singapore’s leading carrier Singtel saw its annual net profit fall 49% last week to SGD 554 million (US $ 420 million) for more than 20 years. Reported to be the lowest level in Singapore.
Operating revenues for the fiscal year ended March 2021 decreased by 5% to S $ 15.64 billion (US $ 11.85 billion) and real net income, excluding exceptional items, decreased by 30% to 1.7 billion. It was S $ 30 million.
The company cited “continuous industry and COVID-19 headwinds” for its overwhelming performance.
The main reason for the 49% plunge in net income from shareholders was S $ 1.18 billion in non-cash impairment losses received from investments in digital marketing platform Amobee and its cybersecurity firm Trustwave. In addition to the reassessment, Singtel said it will undertake a strategic review of the two businesses.
In a statement to investors and the media, the reason for the write-down was “The rapid changes in the fast-moving digital marketing and cybersecurity industry and the economic shock caused by COVID-19 have enabled the expansion of both businesses. “Because of the shrinkage.” .. “As another potential strategic move, Singtel is considering options to unlock the value of infrastructure assets such as towers, satellites, submarine cables and data centers.” Options include investing in some assets with partners and selling other assets.
The Singtel Group’s financial position is sound and net debt is stable at S $ 12.4 billion year-on-year. As of March 31, the Group’s net debt to EDITDA increased 2.2 times from 1.99 times the previous year. Free cash flow was S $ 3.4 billion, down 10% due to lower operating cash flow and higher capital expenditures.
Revenues from consumer businesses in both Singapore and Australia were impacted by COVID-19 shutdowns and travel restrictions.
Excluding NBN (National Broadband Network) migration revenues, which declined in the current reporting year, operating revenues from Singtel’s wholly owned Australian subsidiary Optus were flat. Customer growth, roaming and prepaid revenue were impacted by the significant reduction in services offered to inbound travelers and international students due to the COVID-19 shutdown and travel restrictions. However, this was offset by increased postpaid revenue and equipment sales.
In Singapore, travel restrictions have reduced the number of tourists and foreign workers, and reduced roaming, prepaid mobile and voice revenues. However, this was offset by increased equipment sales as customers upgraded to 5G devices and the timing of the launch of certain premium handset.
Operating revenues for a company or corporation were stable in the second half of the year. The decline in the use of technology-driven legacy voice and roaming services, combined with the rise and sophistication of system integration and application development projects, demands for ICT (Information, Communications, and Technology) services with NCS, Sintel’s ICT division. It was mitigated by the increase. Demand for data storage services that have increased data center revenue.
Digital Life, Singtel’s digital media division, saw a 10% decline in operating revenue due to lower revenues from Amobee, a digital marketing division, and the abolition of the mobile streaming service HOOQ from March 1, 2020. Its legacy services and TV revenue. This was partially offset by the growth of the programmatic advertising platform business.
Singtel’s regional affiliates contributed to S $ 1.71 billion (US $ 1.3 billion), up 4%, due to the strong performance of Bharti Airtel, in which Singtel holds an approximately 35% stake. Operating results increased by S $ 426 million (US $ 323 million) compared to a year ago. Contributions from other regional partners Telkomsel (Indonesia), AIS (Thailand) and Globel (Philippines) declined year-over-year.
Yuen Kuan Moon, CEO of Singtel, said, “The rekindling of the pandemic continues to cast a shadow, but Airtel’s strong performance in India and Africa is encouraging.” Optus, Singtel’s Australian subsidiary, said in Australia. Annual sales to the dollar decreased by 7%. $ 8.32 billion (US $ 6.42 billion). After deducting exceptions and taxes, the company suffered a net loss of A $ 208 million. In the year-ago quarter, it had a net profit of A $ 402 million. The company said it was “the impact of the COVID-19 pandemic, reduced revenue from the NBN transition, market headwinds leading to lower revenue from equipment sales and leasing, and increased NBN costs as customer bandwidth consumption. The write-down is “a ruin movement to give the new CEO a clear outlook,” said Sachin Mittal, a DBS analyst, quoted by Reuters. It is part of. “Yuen took office in January this year.
He further praises SingTel’s core business like any other operator that does not own infrastructure assets, usually ordering a higher rating for regular cash flow and visible growth. ..
“Given the unprecedented headwinds from COVID-19 and the ongoing structural challenges, this year’s results are disappointing,” said CEO Yuen. Data center services have proved to be a bright spot as companies are rushing to digitize and transform their businesses. We have this strategic reset plan to drive recovery and growth. Utilizes a large amount of digitization. (Ani)