Singapore Telecom Financial Results FY2012

Singapore Telecom (Singtel) released its financial results recently for the financial year 1 April 2011 to 31 March 2012 (FY2012).

The following are some key numbers. Figures in brackets refer to previous financial year.

Key Performance Numbers
Operating Revenue $18,825 million (increased 4.2%)
Net Profit attributable to shareholders $3,989 million (increased 4.3%)
EPS    25.04 cents (increased 1.02 cents)
Total Ordinary dividends per share 15.8 cents (same as FY2011)
No special dividend (FY2011 – 10 cents)
Dividend payout ratio 63% of EPS (65% in FY 2011)
Dividend yield 4.87% (based on latest share price)

Net asset value per share $1.47 (FY2011 was $1.53)
Free Cash Flow $3,462 million (FY2011 was  $4,038 million)
Share price at 11 May 2012 was $3.24

Total operating revenue rose 4.2% to $18,825 million. Net profit attributable to shareholders increased 4.3% to $3,989 million. As a result, earnings per share (EPS) also increased by 4.2% to 25.04 cents. Results of FY2012 was an improvement over FY2011 on an overall basis.

The Board proposed a final ordinary dividend of 9 cents. Together with the interim dividend payout (6.8 cents), the total dividend for the whole year will be 15.8 cents that translates into a dividend yield of 4.87 per cent (based on 11 May share price). The total ordinary dividend is identical to previous year. No special dividend was declared for this financial year.

“SingTel’s dividend payout ratio ranges from 55% to 70% of underlying net profit. The Group will continue to review at least on a three-year basis its cash needs for operations and growth, with a view to returning surplus cash to shareholders. This is consistent with the Group’s commitment to an optimal capital structure and investment grade credit ratings, while maintaining financial flexibility.” (Dividend policy of Singtel)

Free cash flow balance of Singtel was $3,462 million. This amount was lower than previous financial year’s $4,038 million. Free cash flow is cash flow from operating activities less capital expenditure, which means that Singtel can use it for future operation or business acquisitions including declaring a special dividend if deemed appropriate based on future business’ operation.

After the release of financial results, share price of Singtel rose. The last traded price was $3.24. The latest net asset value was $1.47 lower than $1.53 recorded in FY2011. The current price-to-book ratio is 2.2 times (FY 2011 was 2.07 times).

On overall basis, Singtel did well in FY2012 against FY2011. It was a consistent performance without any surprises or major shock.

Copyright © 2012, limkimtong for Living Investment

The material presented is intended to be general and written in layman’s language as much as it is possible. The author shall not be liable for any direct or consequential loss arising from any use of material written. Please seek professional advice from your financial advisor or financial institutions on material written covering financial matters.

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