SingTel posted 2QFY15 revenue of S$4309.4m, +3.5% YoY and 3.9% QoQ, while reported net profit jumped 19.3% YoY and 24.4% QoQ to S$1038.3m, boosted by an exceptional gain of S$62.2m; underlying net profit rose 10.7% YoY (+11.1% QoQ) to S$979.0m. 1HFY15 revenue though was flat at S$8457m, meeting 50% of our FY15 forecast, while reported net profit slipped 0.5% to S$1873m; underlying profit grew 4.4% to S$1860m, also 50% of our full-year estimate. SingTel declared an interim dividend of S$0.068/share, unchanged from a year ago. SingTel has kept its guidance for FY15 largely unchanged, except that it now expects a wider negative EBITDA versus 20% narrower previously. We are maintaining our BUY on the stock with an improved SOTP-based fair value of S$4.18 (versus S$4.08 previously.
2QFY15 results in-line
SingTel posted 2QFY15 revenue of S$4309.4m, +3.5% YoY and 3.9% QoQ, aided by first-time contributions from the digital acquisitions – Adconion and Kontera; excluding these two, revenue growth would have been 2.5% YoY. Reported net profit jumped 19.3% YoY and 24.4% QoQ to S$1038.3m, boosted by an exceptional gain of S$62.2m; excluding it, underlying net profit would have risen 10.7% YoY (+11.1% QoQ) to S$979.0m. 1HFY15 revenue though was flat at S$8457m, meeting 50% of our FY15 forecast, while reported net profit slipped 0.5% to S$1873m; underlying profit grew 4.4% to S$1860m, which also met 50% of our full-year estimate. SingTel declared an interim dividend of S$0.068/share, unchanged from a year ago.
Outlook remains largely unchanged
Going forward, SingTel has kept its guidance largely unchanged. It expects group revenue and EBITDA (excluding acquisitions) to be stable; capex to stay at S$2.3b; ordinary dividend from associates to be ~S$1b. For Singapore and Australia Consumer and Group Enterprise, revenue is likely to remain stable and EBITDA to increase by low single-digit level. However, it did downgrade its Digital Life outlook, as it now expects negative EBITDA to increase to S$200-250m versus its earlier guidance of a 20% narrower negative EBITDA; although it expects revenue to exceed S$300m (earlier guided for 50% growth).
Probably some near-term respite from falling AUD
From the analyst call, SingTel appears to be slightly more positive about its Optus business, although SingTel is still guiding for Australia mobile service revenue to decrease by low single digit level. Meanwhile, we note that the AUD/SGD is also rebounding from recent S$1.11 low, which appears to be the floor for now. We are maintaining our BUY on the stock with an improved SOTP-based fair value of S$4.18 (versus S$4.08 previously), mainly due to slightly less bearish cashflow projections for the Australian business.
SingTel posted 2QFY15 revenue of S$4309.4m, +3.5% YoY and 3.9% QoQ, aided by first-time contributions from the digital acquisitions – Adconion and Kontera; excluding these two, revenue growth would have been 2.5% YoY. Reported net profit jumped 19.3% YoY and 24.4% QoQ to S$1038.3m, boosted by an exceptional gain of S$62.2m; excluding it, underlying net profit would have risen 10.7% YoY (+11.1% QoQ) to S$979.0m. 1HFY15 revenue though was flat at S$8457m, meeting 50% of our FY15 forecast, while reported net profit slipped 0.5% to S$1873m; underlying profit grew 4.4% to S$1860m, which also met 50% of our full-year estimate. SingTel declared an interim dividend of S$0.068/share, unchanged from a year ago.
Outlook remains largely unchanged
Going forward, SingTel has kept its guidance largely unchanged. It expects group revenue and EBITDA (excluding acquisitions) to be stable; capex to stay at S$2.3b; ordinary dividend from associates to be ~S$1b. For Singapore and Australia Consumer and Group Enterprise, revenue is likely to remain stable and EBITDA to increase by low single-digit level. However, it did downgrade its Digital Life outlook, as it now expects negative EBITDA to increase to S$200-250m versus its earlier guidance of a 20% narrower negative EBITDA; although it expects revenue to exceed S$300m (earlier guided for 50% growth).
Probably some near-term respite from falling AUD
From the analyst call, SingTel appears to be slightly more positive about its Optus business, although SingTel is still guiding for Australia mobile service revenue to decrease by low single digit level. Meanwhile, we note that the AUD/SGD is also rebounding from recent S$1.11 low, which appears to be the floor for now. We are maintaining our BUY on the stock with an improved SOTP-based fair value of S$4.18 (versus S$4.08 previously), mainly due to slightly less bearish cashflow projections for the Australian business.
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