Singapore’s largest mobile operator Singtel reported flat profit for the financial year ended 31 March due to one-off losses, but its underperforming mobile segment returned to growth, albeit slow, in the January to March quarter after a sharp drop in its fiscal Q3.

The operator’s net profit for its fiscal 2016 dipped 0.5 per cent year-on-year to SGD3.85 billion ($2.75 billion), which the company attributed to exceptional losses compared to an exceptional gain last year. Excluding Airtel, which suffered a sharp profit drop in fiscal Q4, Singtel’s net profit was up 2.3 per cent.

Operating revenue for the full year fell 1.5 per cent to SGD16.7 billion, impacted by a cut in mobile termination rates in Australia. Mobile service revenue fell 11.7 per cent to SGD5.93, accounting for 36 per cent of total revenue, down from 40 per cent the previous year.

Q4 recovery
However, Singtel showed signs of improvement in Q4, with its net profit rising 1.8 per cent to SGD963 million despite Airtel’s weaker earnings (which pulled pre-tax profits for Singtel’s regional associates down 6 per cent to SGD658 million).

Total revenue for the quarter increased 5.2 per cent to SGD4.3 billion, with mobile revenue up 1 per cent to SGD1.5 billion. Strong mobile data and broadband growth across the consumer businesses in Singapore and Australia offset declines in voice and roaming services in the quarter. Data and internet turnover rose 12.5 per cent to SGD893 million.

Chua Sock Koong, Singtel Group CEO, said: “We have turned in a strong set of results this quarter despite a challenging business environment. Our investments in networks and spectrum and differentiated content and have helped us stand out from the competition and win new customers.”

In its home market fiscal Q4 revenue edged up 0.8 per cent to SGD589 million, while mobile revenue was down 0.8 per cent to SGD320 million. Equipment sales jumped nearly 23 per cent during to SGD80 million due to higher volumes and an increased mix of higher tier handsets.

Singtel’s domestic 4G user base rose by 82,000 to 2.6 million, for an LTE penetration of 64 per cent. Post paid ARPU fell 6 per cent to SGD67.00.

Optus in Australia posted a 3.1 per cent increase in revenue to AUD1.74 billion, but mobile service revenue fell 3.2 per cent due to the impact of device repayment plan credits. Post paid ARPU declined 9 per cent to AUD46.00, while prepaid ARPU was up 4 per cent to AUD22.00.

It added 256,000 4G subscribers in the quarter to end-March, with 5.8 million LTE users and 60 per cent penetration. Optus said it upgraded 5,872 base stations to 4G, taking its LTE population coverage to 96 per cent in the quarter.

Singtel’s Digital Life unit, comprising Amobee, OTT video provider HOOQ and analytics company DataSpark, reported a 19 per cent increase in operating revenue to SGD539 million in fiscal 2016 and negative EBITDA of SGD122 million.

Overall revenue for fiscal 2017 is forecast to grow about 5 per cent. The operator expects mobile service revenue in Australia to increase at a low single-digit rate, with a slight decline predicted for Singapore.