SingTel posted 2QFY14 revenue of S$4163.1m, down 9% YoY and 3% QoQ, again weighed by weaker regional currencies (AUD, IDR and INR depreciated 10% YoY against SGD). Reported net profit was flat YoY and down 14% QoQ at S$870.4m; excluding exceptional items, core earnings was flat YoY and +1.4% QoQ at S$884.0m. 1HFY14 revenue slipped 7% to S$8456.4m, meeting 50% of our FY14 forecast, while reported net profit gained 4% to S$1881.4m; core earnings rose 3% to S$1781.0m, or 48% of full-year forecast. SingTel declared an interim dividend of 6.8 S cents, same as 1HFY13, representing a payout ratio of 61%. Meanwhile, SingTel has kept its FY14 guidance unchanged – it expects consolidated group revenue to decline by mid-single digit level and EBITDA to decline by low single digit level; EBIT will also fall by a mid-single digit level. As the 1H results were largely in line with our expectation, we opt to leave our FY estimates unchanged. Our SOTP-based fair value also remains at S$3.81. Maintain HOLD.
Decent despite currency impact
SingTel posted 2QFY14 revenue of S$4163.1m, down 9% YoY and 3% QoQ, again weighed by weaker regional currencies (AUD, IDR and INR depreciated 10% YoY against SGD). Reported net profit was flat YoY and down 14% QoQ at S$870.4m; excluding exceptional items, core earnings was flat YoY and +1.4% QoQ at S$884.0m. 1HFY14 revenue slipped 7% to S$8456.4m, meeting 50% of our FY14 forecast, while reported net profit gained 4% to S$1881.4m; core earnings rose 3% to S$1781.0m, or 48% of full-year forecast. SingTel declared an interim dividend of 6.8 S cents, same as 1HFY13, representing a payout ratio of 61%.
Keeps guidance unchanged
SingTel has kept its guidance for FY14 unchanged. As before, SingTel expects revenue from Group Consumer to decline by a high single-digit level, with lower revenues from Optus, and EBITDA to decline by a low single-digit level. Group Enterprise revenue should remain stable; but EBITDA to see a low single-digit decline. Its Group Digital Life revenue should grow by at least 50% on an organic basis; but it will continue to see startup losses. As such, it expects consolidated group revenue to decline by a mid-single digit level and EBITDA to decline by a low single digit level; EBIT will also fall by a mid-single digit level. Capex will remain at S$2.5b to support LTE coverage expansion; and the group will invest up to S$2b for digital business over the next three years.
Maintain HOLD with S$3.81 fair value
Last but not least, SingTel expects S$2b of free cash-flow, which supports our case for a continued dividend payout of at least 16.8 S cents for the full year. As the 1H results were largely in line with our expectation, we opt to leave our FY estimates unchanged. Our SOTP-based fair value also remains at S$3.81. Maintain HOLD
SingTel posted 2QFY14 revenue of S$4163.1m, down 9% YoY and 3% QoQ, again weighed by weaker regional currencies (AUD, IDR and INR depreciated 10% YoY against SGD). Reported net profit was flat YoY and down 14% QoQ at S$870.4m; excluding exceptional items, core earnings was flat YoY and +1.4% QoQ at S$884.0m. 1HFY14 revenue slipped 7% to S$8456.4m, meeting 50% of our FY14 forecast, while reported net profit gained 4% to S$1881.4m; core earnings rose 3% to S$1781.0m, or 48% of full-year forecast. SingTel declared an interim dividend of 6.8 S cents, same as 1HFY13, representing a payout ratio of 61%.
Keeps guidance unchanged
SingTel has kept its guidance for FY14 unchanged. As before, SingTel expects revenue from Group Consumer to decline by a high single-digit level, with lower revenues from Optus, and EBITDA to decline by a low single-digit level. Group Enterprise revenue should remain stable; but EBITDA to see a low single-digit decline. Its Group Digital Life revenue should grow by at least 50% on an organic basis; but it will continue to see startup losses. As such, it expects consolidated group revenue to decline by a mid-single digit level and EBITDA to decline by a low single digit level; EBIT will also fall by a mid-single digit level. Capex will remain at S$2.5b to support LTE coverage expansion; and the group will invest up to S$2b for digital business over the next three years.
Maintain HOLD with S$3.81 fair value
Last but not least, SingTel expects S$2b of free cash-flow, which supports our case for a continued dividend payout of at least 16.8 S cents for the full year. As the 1H results were largely in line with our expectation, we opt to leave our FY estimates unchanged. Our SOTP-based fair value also remains at S$3.81. Maintain HOLD
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