Singtel this morning reported 1QFY16 revenue of S$4208.5m, +1.5% YoY but down 3.0% QoQ, meeting 24% of our full-year forecast, while reported net profit climbed 4.8% YoY (+0.3% QoQ) to S$941.6m; underlying earnings inched up 1.6% YoY (-5.8% QoQ) to S$895.0m, or about 23% of our FY16 estimate.

As expected, results were impacted by the 11% YoY decline in the AUD against the SGD; otherwise in constant currency terms, operating revenue grew 8.3% and underlying profit +4.6%. Singtel has also affirmed its earlier guidance, calling for core revenue (Group Consumer and Group Enterprise) to grow at mid single-digit level; EBITDA to grow at low single-digit level.

Cash capex remains at S$2.3b and S$3b on accrual basis; free cashflow to come in around S$1.5b. Dividend from associates should come in around S$1.1b in FY16. We will have more after the analyst briefing. We are keeping our BUY call but place our S$4.40 fair value under review.

Source: OCBC Research - 13 Aug 2015