1Q11 Results Mostly In Line
SingTel released its 1Q11 results this morning, with revenue up 11.5% YoY; but it fell 4.1% QoQ and was also about 3.8% below our estimate, mainly hit by seasonally lower IT and Engineering revenue.
Net profit eased 0.2% YoY to S$943.2m; however, it fell 7.1% QoQ, again due mainly to seasonal factors and lower associate contributions (down 17.8% YoY and 6.9% QoQ); but it was just 1.6% shy of our forecast, as overall EBITDA margin was relatively steady at 29.3%, versus 29.9% in both 1Q10 and 4Q10.
Going forward, SingTel maintains its previous guidance for the rest of FY11, although it continues to caution that its consolidated operating revenue and operational EBITDA will be impacted by AUD movements and the earnings contributions from its regional associates will be affected by regional forex movements as well.
Until then, we place our BUY rating and S$3.40 fair value under review.
Source: Carey Wong (OCBC)
