UPDATE 1-SingTel Q3 net profit falls 8.3 pct, sees revenue drop

SINGAPORE Wed Feb 13, 2013 6:43pm EST

SINGAPORE Feb 14 (Reuters) - Singapore Telecommunications Ltd, Southeast Asia's largest telecom operator, reported on Thursday a worse-than-expected 8.3 percent fall in third quarter net profit and reiterated its forecast for a fall in revenues this year.

The Singapore telco, which owns Australia's Optus and stakes in several mobile operators in the region, has been struggling to grow its earnings due to slowing growth in Singaporean and Australian mobile phone subscriptions and problems at Indian associate Bharti Airtel.

For the financial year ending March 2013, SingTel said it expects a low single-digit increase in revenue from Singapore and a mid single-digit drop in revenue from Australia.

SingTel, Singapore's largest company by market capitalisation, earned S$827 million ($668 million) in the three months ended December, falling from S$902 million a year ago as a strong Singapore dollar and one-off charges eroded its bottom line.

Its results lagged the S$900 million average estimate of three analysts polled by Reuters.

The lower profit was mainly due to exceptional charges of S$67 million for the restructuring of Optus' workforce and accelerated depreciation charges at Philippine associate Globe Telecom's network modernisation.

SingTel's underlying net profit fell 2.3 percent to S$874 million from S$895 million a year ago.

Revenue fell 5 percent to S$4.60 billion while earnings before interest, tax, depreciation and amortisation (EBITDA) were stable at S$1.26 billion.

OPTUS, BHARTI

SingTel said its Australian operation Optus reported EBITDA growth of 3 percent during the quarter, despite a 6 percent decline in revenue.

"EBITDA margin improved 2.0 percentage points to 25.2 percent, reflecting strong cost management," it added.

Regional mobile phone associates, Thailand's Advanced Info Service (AIS) and Indonesia's Telkomsel, recorded robust growth, which was partially offset by Bharti's lower earnings and weak regional currencies.

AIS, the top Thai mobile phone operator, reported a more than doubling in quarterly net profit, boosted by strong voice and data services and higher handset sales after the launch of Apple's iPhone 5.

For Indonesia's Telkomsel, SingTel's share of pretax ordinary profit rose 10.5 percent to S$250 million during the quarter from a year ago. In constant currency terms, the contribution from Telkomsel rose 24.5 percent.

Bharti, India's biggest mobile phone operator, however, reported its net profit fell for the 12th consecutive quarter, hurt by foreign exchange losses as well as higher taxes and financing costs.

SingTel owns about a third of Bharti, whose 72 percent year-on-year drop in quarterly profit was way below the estimates of analysts polled by Reuters.

"Pre-tax earnings (from associates) grew 1 percent to S$455 million and would have increased 11 percent if exchange rates were unchanged from a year ago," SingTel said.

SingTel said it will continue to invest in networks and adopt "transformational initiatives" to drive longer-term growth.

"As a result of these investments, the group incurred higher depreciation, spectrum amortisation charges, and increased costs from the acquisition of digital companies," it said.

(Reporting by Kevin Lim and Eveline Danubrata; Editing by Richard Pullin)