Telecom giant SingTel, which holds around 32 per cent stake in Bharti Airtel, has reported an 8.3 per cent decline in net profit at Rs 3,603 crore due to transformation initiatives, increased depreciation and exceptional charges during the third quarter ended December 31, 2012.
The company had reported a net profit of Rs 3,928.29 crore during the same period a year-ago.
“Net profit (was) lower by 8 per cent due to costs associated with transformation initiatives, increased depreciation and exceptional charges,” SingTel said in a statement.
Depreciation, amortisation cost
SingTel reported 5 per cent increase in the depreciation and amortisation cost at Rs 2,282 crore during the quarter from Rs 2,172.85 crore in the corresponding period a year-ago.
Exceptional charges for Singtel group stood at Rs 2,917.75 crore. The exceptional charges include ex—gratia payments of its Australian subsidiary, Optus, for the restructuring of its workforce and accelerated depreciation charges related to Globe’s network modernisation and IT transformation programmes.
Singtel group revenues declined 4.8 per cent to Rs 20,025 crore from Rs 21,041.36 crore.
“The performance of the group demonstrates the resilience of our core operations and focused execution even as we recognise the challenges in the various markets. We are executing our transformation plan to grow in the new digital era, exploiting opportunities in mobile data and enterprise ICT services,” SingTel group CEO Chua Sock Koong said.
The company saw the impact of Bharti Airtel financial performance and weak Indian rupee on the group’s revenue as well.
“The group’s regional mobile associates, in particular Telkomsel (Indonesian associate of SingTel) and AIS (Thai Associate of SingTel), recorded robust growth, which were partially offset by lower earnings from Airtel and the weaker regional currencies,” SingTel statement said.
Airtel’s pre-tax contribution to the group declined 46 per cent to Rs 304.88 crore, mainly due to weaker Indian rupee, increased depreciation and amortisation, higher net financing costs and fair value losses.
Airtel South Asia
SingTel said Airtel South Asia posted an 8 per cent increase in revenue driven by strong voice traffic growth but the growth was offset by higher costs from expanded network and 3G and LTE (4G technology) investments.
Airtel Africa registered a 6 per cent growth in EBITDA from robust growth in mobile voice traffic, it added.