A strong showing by Optus and several other overseas subsidiaries has enabled Singapore Telecommunications (SingTel) to lift revenue by 9.5 per cent and net profit by 2 per cent in its latest financial quarter.
SingTel's Australian telecommunication subsidiary, Optus, posted a $22 million ($US13 million) profit for the quarter compared to a loss of $39 million for the same quarter last year. Revenue came in at $1.45 billion, an increase of 16 per cent over the previous year.
The SingTel group now expects Optus to be cash-flow positive in the current financial year. It originally predicted such a task would take another 12 months to achieve.
“Our results in Australia and the strong performance of our other overseas investments mean that we have significantly reduced our dependency on our Singapore operations to maintain earnings growth,” SingTel president and CEO, Lee Hsien Yang, said. “We are particularly encouraged by the performance of Optus which has continued its strong turnaround and is now profitable. The economic outlook for Australia – our largest geographic market in terms of revenue – also remains robust.”
His sentiments were shared by Optus chief executive, Chris Anderson.
“We have strong revenue growth, margin growth and market share growth. For three quarters in a row, Optus has achieved double digit growth,” he said.
The Optus Mobile division increased revenue by 18 per cent, with margins at 36 per cent. The company’s mobile subscribers grew 12 per cent to 4.5 million. The Optus Business division recorded revenue growth of 19 per cent and the consumer and multimedia division reported a quarterly EBITDA of $14 million.
The Optus Wholesale division was the only business unit to report declining revenue.
“The general wholesale market continues to suffer from capacity oversupply and downward pressure on prices,” the company said.
“Over the last year, we have remained focused on managing cash and costs,” Anderson said. “We are now reaping the reward for those efforts.”
SingTel’s overall revenue for the quarter ended December 31, 2002 reached $2.52 billion ($US1.49 billion), 9.5 per cent higher than the $2.30 billion for the same quarter the previous year. Net profit rose to $280 million from S$290 million over the same period.
The company’s stakes in Indonesia, Thailand and Belgium all improved considerably. SingTel now has mobile phone operations in six countries in the region - Singapore, Thailand, India, the Philippines, Indonesia and Australia - with an aggregate mobile subscriber base of 32.1 million, 64 per cent up on the previous year's figure.
By contrast, in its home market, SingTel's revenue fell by 3.3 per cent. Only broadband Internet and mobile data services such as SMS showed appreciable growth.