SingTel Q1 profit slumps 23% on unfavourable currency move, high costs

(Reuters) -Singapore Telecommunications reported on Monday a 23% decline in first-quarter net profit, citing the one-off impact at Bharti Airtel in Nigeria as the naira depreciated sharply against the U.S. dollar, as well as high costs.

Singapore Telecommunications (SingTel), Southeast Asia’s largest telecoms company, owns an effective 29.5% stake in India’s Bharti Airtel.

SingTel said in a statement net profit for the quarter ended June 30 was S$483 million ($355.91 million), compared with S$628 million a year earlier.

In the three months ending June 30, SingTel logged a net exceptional loss of S$88 million owing to a sharp depreciation in the Nigerian naira, compared with an exception gain of S$129 million a year ago.

On an underlying basis, net profit for the quarter gained 14.5% to S$571 million.

SingTel also recorded a 2.7% decline in its first-quarter operating revenue to S$3.49 billion, hurt by currency exchange headwinds and competition.

“While we saw better performances and higher contributions from our regional associates as market dynamics improved, increased competition and continued declines in legacy services impacted our core telco business in Singapore and Australia,” SingTel’s Chief Executive Officer Yuen Kuan Moon said.

Optus, SingTel’s top revenue-generating unit, saw an uptick in operating revenue during the quarter, but higher costs due to inflation and energy expenses cut into its operating earnings, which fell 5.5% to S$456 million.

($1 = 1.3571 Singapore dollars)

(Reporting by Sameer Manekar and Upasana Singh in Bengaluru; Editing by Muralikumar Anantharaman)