SingTel's profit rises on exceptional gain from stake reduction in India's Airtel
By Shivangi Lahiri and Adwitiya Srivastava
(Reuters) -Singapore Telecommunications' first-quarter earnings climbed, mainly buoyed by a net exceptional gain from diluting its stake in Indian telecom provider Bharti Airtel and the sale of some capital assets by associate Globe Telecom (OTC:GTMEY ).
Singtel's net profit rose 42.9% to S$690 million in the first quarter ended June 30 from S$483 million a year ago, Southeast Asia's largest telecom provider said on Thursday.
The exceptional gain came as Singtel reduced its effective stake in Airtel to 28.7% from 28.9%.
Additionally, the Philippines-based Globe Telecom sold some telecommunication towers, contributing to Singtel's one-time gain.
The company owns a nearly 47% stake in Globe Telecom, according to LSEG data.
Singtel's first-quarter profit excluding its net exceptional gain came to S$603 million.
"Improvements in our core businesses in Singapore and Australia... helped mitigate lower contributions from our regional associates due mainly to significant currency headwinds in Africa," said SingTel CEO Yuen Kuan Moon.
Operating earnings for its Australian telecom unit Optus rose 4.2% to S$475 million ($360.59 million), helped by price increases in postpaid plans and a higher prepaid customer base.
Optus drew attention recently over problems caused by an outage last year, as well as a massive cyber attack in 2022 that impacted earlier profits.
"Optus is benefitting from staff reduction and other cost cuttings done in the second half of fiscal 2024 and the May tariff hike, which will continue to benefit them in subsequent quarters too," said Sachin Mittal, Head of TMT research at DBS.
Shares in SingTel rose as much as 2.4% to S$2.98 by 0328 GMT, hitting their highest level since Aug. 1.
Southeast Asia's leading telecom firm also forecast high single- to low double-digit growth in operating earnings for the full year.
($1 = 1.3173 Singapore dollars)
Source: Investing.com
