When I read of the above news, I was rather neutral since I had not invested in Singtel stock before unlike a number of investors who may have liked Singtel stock based on the perception that it is a defensive Singapore stock with a decent dividend yield.I would think that unless investors vested in Singtel stock have kept up with Singtel stock development in recent years, the impression of defensive dividend play might have been rooted in the earlier trading days of Singtel stock where the business environment is unlike the competitive and more dynamic landscape today. Singtel recently cut its payout for the financial year to March 31 to 12.25 cents a share, down from 17.5 cents the year before. 5) Dividend cut 10.7cents to 5.45. Singtel has announced a reduction in its dividend pay-out, in line with weaker sentiment and uncertainties relating to the Covid-19 pandemic. Singapore Telecommunications Limited, or Singtel, released its full fiscal year 2020 earnings this morning.The Covid-19 pandemic had a negative impact on mobile service usage due to travel and movement restrictions, leading to lower prepaid and roaming revenue.On the bright side, Singtel recently won one of two provisional licences to deploy 5G technology and infrastructure in Singapore.Singtel's Australian subsidiary, Optus, has already started its 5G rollout last year.Here are four other takeaways from the telco's full-year earnings report.Operating revenue for Singtel declined by 4.8 per cent year on year, to $16.5 billion for the full fiscal year.The full-year results were dragged down by the fiscal fourth quarter, which saw the adverse effects of Covid-19 creeping in.The group experienced broad-based declines in mobile, TV and fixed voice for Singapore, while Australia witnessed lower operating revenue from lower retail fixed and equipment sales revenue, offset slightly by higher contributions from next-generation broadband network (NBN) migration.Weakness in the Australian dollar also contributed to the lower revenue, as constant currency revenue decline would have been just 2 per cent year on year.Higher levels of depreciation resulted in operating profit declining by 7.5 per cent year on year.Underlying net profit (after stripping out exceptional items such as Bharti Airtel's provision for regulatory cost relating to a one-time spectrum charge) declined by 13 per cent year on year due to higher tax expenses.Mobile revenue suffered due to movement restrictions and lockdowns.For Singapore, total mobile revenue fell 7.7 per cent year on year to $2.3 billion. Year Yield Total Amount Ex Date Pay Date Particulars; 2020: 2.25%: SGD 0.055: SGD0.0545 Singtel paid an interim dividend of 6.8 cents per share (paid on 10 January 2020) for the financial year ending 31 March 2020, amounting to approximately S$1.11 billion. Weaker underlying net profit. Singtel has either maintained or … Already two months ago, Accell cut its dividend. Singtel has announced a reduction in its dividend pay-out, in line with weaker sentiment and uncertainties relating to the COVID-19 pandemic. Against a more competitive business backdrop, the cut in dividend yield is not surprising to me.As I have always highlighted, the best run-up of prices of the Straits Times Index stocks might be in the yester-years of fast industrialisation growth of Singapore. Valuations at -1.5SD post-GFC EV/EBITDA mean (-2SD from 5-year mean) are backed by dividend yields exceeding 5%. In an Oct 10 report, DBS Group Research said Singtel may be forced to abandon its fixed dividend policy and peg dividend … All dividends paid after the FY2007 interim ordinary dividends are one-tier exempt dividends without tax credits.To learn more about Singtel's past capital management initiatives - see Our website uses cookies to improve our site and your online experience. SINGAPORE (Oct 14): Citi Research believes there is little likelihood for Singapore Telecommunications (Singtel) to cut FY21 dividends to 13-15 cents/share from the current 17.5 cents/share, despite worries raised by some quarters of the market recently. At Singtel’s last traded share price of S$2.53, this represents a trailing 12-month dividend … Mobile revenue consists of mobile service revenue, the sale of mobile equipment and handset leasing.Of this total, mobile service revenue fell 9.7 per cent year on year to $1.5 billion.Equipment sales witnessed a small 3.9 per cent year on year decline due to supply chain disruptions, while handset leasing revenue performed better.Over at Australia, total mobile revenue declined by 4.7 per cent year on year to A$5.7 billion (S$5.4 billion), led by lower mobile service revenue (down 5 per cent year on year) and a decline of 7.3 per cent year on year in equipment sales.Moving forward, mobile revenue will remain under pressure if the pandemic does not ease up.However, some countries have begun easing lockdowns, which may allow revenue in this segment to slowly recover.Singtel managed to increase its mobile market share in Singapore from 49.9 per cent a year ago to 50.4 per cent.The telco had a total of 4.28 million mobile subscribers at end-2020, 2.1 per cent higher than the 4.19 million it had a year ago.However, a key operating metric, the average revenue per user (ARPU), declined by 11.1 per cent year on year from $33 per month to $30.Both prepaid and postpaid ARPU saw declines of 9.6 per cent and 12.5 per cent year on year, respectively.Over in Australia, the number of mobile subscribers also increased, albeit by a smaller 1.6 per cent year on year, to 10.4 million subscribers.However, blended ARPU per month saw a 6.6 per cent year on year decrease to A$29 per month, with ARPU declines seen in prepaid, postpaid and mobile.These numbers confirm a worrying trend - that of lower revenue capture per customer even as both countries see a rise in subscriber numbers.If left unchecked, the steady decline in ARPU will continue to erode Singtel's mobile revenue over the medium-term.Singtel has announced a reduction in its dividend pay-out, in line with weaker sentiment and uncertainties relating to the Covid-19 pandemic.The final dividend declared was $0.0545, 49 per cent lower than the $0.107 declared last year.Including the interim dividend of $0.068, the total full-year dividend of $0.1225 represents around 81 per cent of underlying net profit and a 30 per cent year on year decline from last fiscal year's $0.175 dividend.At Singtel's last traded share price of $2.53, this represents a trailing 12-month dividend yield of around 4.8 per cent.Singtel generated $3.8 billion in free cash flow for the fiscal year ended March 31, 2020.Although the telco has a history of consistent free cash flow generation, multi-year investments in 5G technology and infrastructure may raise capital expenditure levels significantly.In turn, this will crimp the level of free cash flow generation in future years.Coupled with declining mobile, residential pay-TV and fixed voice revenue for Singapore, the telco may witness further financial stress.If these pain points continue unresolved, there may be a further cut in dividends down the line.Your daily good stuff - AsiaOne stories delivered straight to your inboxAsiaOne Online Pte Ltd. 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The carrier will pay a 12.25 Singapore cents a share dividend for the year, compared with the company’s previous outlook for 17.5 Singapore cents a share. Also, Singtel reduced its dividend to about half of the 2019 amount. The carrier booked … By continuing to use our website, you consent to cookies being used. Including the interim dividend of S$0.068, the total full-year dividend of S$0.1225 represents around 81% of underlying net profit and a 30% year on year decline from last fiscal year’s S$0.175 dividend. See our * The figures shown above are gross amounts, shown in Singapore cents per share, before deduction of applicable Singapore corporate tax. On 29 July 2020, the Monetary Authority of Singapore (MAS) released a statement recommending that Singapore banks (i.e. Dear readers, DBS Equity Research has recently commented that Singtel may cut its dividend rate starting April 2020.
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