SingTel

SingTel: 3QFY14 results came in above street estimates, with underlying net profit at $910 (+4% y/y) vs consensus of $873m. Reported net profit gained 6% to $872m, despite lower Australia mobile revenue and a weaker AUD, buoyed by continued strong performance in Singapore mobile and mio TV services, cost management at the Australian consumer operations which improved margin, and higher contribution from Bharti. Group operating revenue declined 7% to $4.26b, mainly dragged by Australia’s Optus, as the AUD depreciated by a significant 9%, while a generally cautious business climate led to lower Australia mobile revenue. Meanwhile, the group’s share of associates’ pretax profits increased 11% to $539m, with strong earnings growth from Bharti. Operationally, the group and its regional mobile associates continue to record strong customer growth with a combined mobile customer base of 501m (+8.9% y/y) as at end 2013. Mgt provided the following forward guidance: - Affirms Aug forecast for group revenue to decline by mid single digit - Affirms group EBITDA to decline by low single digit - Sees consumer segment revenue decline by low double digit vs prior view of high single digit level decline - Sees enterprise segment revenue to decline by low single digit vs prior stable view - Cash capex for S’pore and Australia to be $2.2b (from $2.5b), on lower currency effect and delayed spending At $3.51 last close, SingTel trades at 15.6x annualized 9MFY14 underlying P/E.