[SINGAPORE] Singtel returned to the black with a net profit of S$2.8 billion for its second half ended March 2025, compared with a net loss of S$1.3 billion for the previous corresponding period.
This translates to basic earnings per share of S$0.1688, against a loss per share of S$0.0813 previously.
The turnaround came on a net exceptional gain of S$1.5 billion, as compared to a net exceptional loss recorded for the year-ago period.
Singtel also announced on Thursday (May 22) that the group has authorised its first share buyback programme of up to S$2 billion, as part of the company’s capital management strategy. Singtel shares will be bought on the open market and cancelled as part of the programme.
That will improve the earnings and dividends per share with a smaller share base, but the main focus is on broadcasting the belief in Singtel’s long-term value, said Arthur Lang, Singtel CFO.
He added: “It is to send a signal to the market that anytime when our price faces volatility, the company will go out there and buy shares over the next three years.”
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Funding for the share buybacks will be underpinned by excess capital from the group’s asset-recycling proceeds.
In May 2024, Singtel set a mid-term asset recycling target of S$6 billion under its Singtel28 growth plan, which it is now raising to S$9 billion.
Singtel said that the S$1.5 billion net exceptional gain came mainly from a S$1.29 billion gain from the partial disposal of its Comcentre headquarters and its share of its joint venture Bharti Airtel’s gains.
Airtel, of which Singtel now owns 28.3 per cent, after selling its 1.2 per cent stake in the group in mid-May, delivered double-digit growth in operating revenue and earnings before interest, taxes, depreciation, and amortisation for both India and Africa, in constant currency terms.
Airtel’s gains comprised mainly a fair value gain from the consolidation of Indus Towers, some reversal of doubtful debt provision by Indus Towers, foreign exchange gains from the appreciation of the Nigerian naira and Tanzanian shilling and recognition of a deferred tax credit from tax losses.
Additionally, the group reaped a S$178 million gain from the disposal of its 3.7 per cent stake in Singtel associate Intouch.
However, the exceptional gains were partly offset by losses, comprising a S$290 million non-cash impairment charge made on Singtel’s investment in APT Satellite and certain property, plants and equipment alongside provisions made for the group’s various regulatory and tax exposures.
Operating revenue for the second half was up at S$7.2 billion from S$7.1 billion in the year-ago period.
Singtel’s board has proposed a final dividend of S$0.10 per share, consisting of a core dividend of S$0.067 and a value realisation dividend of S$0.033.
Return on invested capital (ROIC) has been steadily increasing over the last four years, from 7.3 per cent in FY2022 to 9.6 per cent in FY2025.
For the full year, Singtel’s net profit climbed to S$4.02 billion from S$795 million in the year-ago period. Basic earnings per share rose to S$0.2434 from S$0.0482 previously. Operating revenue was largely stable at S$14.1 billion.
Singtel has met its FY2025 guidance of earnings before interest and taxes (Ebit) growth rate of high teens to low 20s with an Ebit growth rate of 20 per cent.
Regional associates dividend also met FY2025 guidance of S$1.3 billion, and capex fell below the guided S$2.8 billion to S$2.4 billion in FY2025.
The company is guiding for FY2026 Ebit growth rate of high single digits, an annual cost savings of S$200 million between Singtel and Optus, regional associates dividend of S$1 billion and a capex of S$2.5 billion.
While Singtel has no direct impact from ongoing US tariffs, the potential slowing-down of the economy from tariff shocks pose the biggest risks said Yuen Kuan Moon, Singtel CEO.
“It really depends on how well the economy is doing, we’ll get a natural uplift if the economy is doing well, we’ve got a bit more pressure when the economy is doing poorly,” he added.
Data centres and enterprise
The revision to the US AI Diffusion framework by the Trump administration is a boost for Singtel’s data-centre arm, Digital InfraCo. With the move away from tier two, now most countries have fewer restrictions and caps on graphics processing units.
“Our data centres are being sort of booked by many of these players of deploying AI, and because there are no restrictions on tier two, we think that this is a positive,” said Bill Chang, CEO, Singtel Digital InfraCo.
Optus and NCS will also be teaming up in aiding NCS’ entry into Australia, with the tech services company providing expertise to Optus in modernising its network infrastructure and improving Optus’ data and AI capabilities.
“Our mid-tier and enterprise customers often want services beyond to manage their various product suites, and that’s something that the team at NCS has the skill set and capability to go to market with us,” said Stephen Rue, Optus CEO.
The counter ended Wednesday 1 per cent or S$0.04 higher at S$3.85 before the news.
