Singapore’s largest mobile operator Singtel Group has raised its earnings before interest and taxes (EBIT) guidance as its underlying profit up 10 percent to S$1.49 billion ($1.16 billion) in the first half.
The firm said in a statement on Friday that it achieved higher EBIT contributions from NCS, Digital InfraCo and Optus and profits from regional associates Airtel and AIS as well as a first-time dividend from Gulf Development.
Underlying net profit would have risen 16 percent without the foreign currency impact of S$75 million, it noted.
Meanwhile, the firm’s net profit was 55 percent lower at S$1.54 billion mainly due to S$2.21 billion in net exceptional gains from the partial stake sale in Airtel and the Intouch-Gulf Energy merger in the corresponding period last year.
Operating revenue rose 6 percent to S$7.29 billion while earnings before interest, taxes, depreciation, and amortization (EBITDA) and OpCo EBIT increased 8 percent and 9 percent to S$2.15 billion and S$0.90 billion respectively, lifted by healthy growth by NCS, Digital InfraCo and Optus.
“Our higher OpCo EBIT reflects the stronger operating performance across the Group with NCS, Digital InfraCo and Optus achieving double-digit EBIT growth. Singtel Singapore’s enterprise segment continues to differentiate the business while its tri-brand consumer strategy has generated positive mobile revenue growth despite intense market competition,
“Contributions from our regional associates were robust as they delivered broad-based mobile growth which helped offset foreign currency headwinds. We are raising our full-year guidance on the back of this results momentum,” said Yuen Kuan Moon, Singtel Group Chief Executive Officer.
“This improved performance is the result of executing closely to our ST28 growth plan, reflecting efforts to lift the performance of our businesses and scale new growth engines while maintaining discipline in how we invest and allocate capital,” he added.
It is noted that in August, together with KKR, Singtel Group completed its STT GDC acquisition, becoming one of the region’s top data center platforms with a combined 950MW of operating capacity between STT GDC and Nxera.
Singtel said demand for Nxera’s data centers is strong with Singapore capacity completely contracted while its data centers in Malaysia and Indonesia will commence operations by the end of this financial year, bringing operating capacity to over 200MW.
Sovereign cloud RE:AI continues to scale with a disciplined approach to capacity deployment backed by customer demand. It recently became the first in APAC to deploy NVIDIA DGX GB300., it added.
“We have made significant progress in diversifying and shifting the Group towards digital infrastructure and services, with Digital InfraCo and NCS now accounting for some 18 percent of Group EBITDA. With the acquisition of STT GDC, we are further positioned to enhance the growth of our portfolio as STT GDC continues its expansion with capital discipline,
“We have also seen strong commercial demand for our sovereign cloud RE:AI, and will continue to leverage compute, connectivity and AI services to capture growth across the AI value chain. As these businesses grow, we expect them to make increasingly meaningful contributions to the Group and deliver sustainable value for our customers and shareholders,” Yuen said.
While there are challenges ahead given the inflationary environment and weakening regional currencies, Singtel said it will continue to navigate the difficult environment with a disciplined approach to execution and cost management.
With the strong operating performance in the first half of the financial year and expectations that business momentum and growth will continue, the group is raising its full-year OpCo EBIT growth guidance from between low and mid-single digits to between mid and high-single digits. The group also affirms the rest of its previously issued guidance for FY2027.
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