Singtel reported a moderate drop in both profit and revenue for its fiscal Q2 ending 31 September and expects consolidated revenue for the full year to drop by a low single-digit figure as mobile growth stalls in Singapore and Australia.

The operator’s net profit for the quarter fell 5.6 per cent to SGD972 million ($714 million) due to exceptional gains recorded by Airtel a year ago, while group revenue for the quarter declined 2.3 per cent to SGD4.086 billion. Excluding exceptional items, its net profit edged up 0.4 per cent to SGD974 million.

Revenue for its consumer group fell 8 per cent despite strong mobile data growth due to increased voice to data substitution and lower mobile termination rates (MTRs) in Australia. Without the MTR reduction, its operating revenue would have increased 2 per cent.

In its home market of Singapore, consumer revenue was down 3 per cent to SGD536 million, with a 20 per cent drop in equipment sales fuelling the decline. Mobile service revenue slipped 2 per cent to SGD520 million, with postpaid ARPU falling 6 per cent to SGD69 ($51).

It added 89,000 4G customers in the last quarter, taking its total 4G user base to 2.5 million and accounting for 60 per cent of total subscribers.

In Australia, Optus saw consumer sales drop 11 per cent to AUD1.7 billion ($1.28 billion) as a government mandated reduction in MTRs led to a 21 per cent decline in mobile service revenue to AUD919 million. Equipment sales rose 8 per cent to AUD332 million. Both prepaid and postpaid ARPU dropped by more than 20 per cent.

Optus’ 4G penetration rose to 56 per cent after it added 335,000 4G subscribers last quarter.

Regional units
On the positive side, Singtel said strong operating results at Telkomsel in Indonesia and Airtel in India helped push up its regional mobile associates’ pre-tax profits by 7.4 per cent to SGD679 million.

Telkomsel’s pre-tax profit jumped 22 per cent to SGD679 million as it benefited from network investments and growth in its voice, data and digital businesses. Airtel’s pre-tax profit rose 13 per cent to SGD172 million. But AIS in Thailand suffered a 19 per cent drop in its pre-tax profit, as competition intensified and it made a substantial payment to state-owned TOT for use of its towers and 2G facilities. And Globe Telecom in the Philippines’ pre-tax profit dropped 25 per cent due to the impact of its acquisition of San Miguel’s telecoms assets.

For its full fiscal year end 31 March next year, Singtel expects operating revenue from its core consumer and enterprises groups to fall by a low single-digit figure and EBITDA to be stable. Mobile service revenue in Australia is forecast to face a moderate decline, while mobile communications turnover in Singapore will be stable.