Financial Results Presentation Q3 FY14: Quarter ended 31 December - PowerPoint PPT Presentation

Financial Results Presentation Q3 FY14: Quarter ended 31 December 2013 13 February 2014 Chua Sock Koong Group CEO 1

Forward looking statement – important note The following presentation contains forward looking statements by the management of Singapore Telecommunications Limited ("SingTel"), relating to financial trends for future periods, compared to the results for previous periods. Some of the statements contained in this presentation that are not historical facts are statements of future expectations with respect to the financial conditions, results of operations and businesses, and related plans and objectives. Forward looking information is based on management's current views and assumptions including, but not limited to, prevailing economic and market conditions. These statements involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those in the statements as originally made. Such statements are not, and should not be construed as a representation as to future performance of SingTel. In particular, such targets should not be regarded as a forecast or projection of future performance of SingTel. It should be noted that the actual performance of SingTel may vary significantly from such targets. “S $ ” means Singapore dollars and "A$" means Australian dollars unless otherwise indicated. Any discrepancies between individual amounts and totals are due to rounding. 2

Agenda 01 // Overview 02 // Group Consumer 03 // Group Enterprise 04 // Group Digital L!fe 05 // Financial Position and Outlook 06 // Supplementary Information 3

Q3 FY14: Strong results despite currency impact % change Group highlights › Down 2% in constant currency Operating revenue › -7% Lower Australia mobile revenue and weaker › S$4,263m Australian dollar › EBITDA Up 6% in constant currency Stable › › Continued cost management S$1,264m Regional Mobile Associates’ › Up 24% in constant currency pre-tax earnings 1 +11% › Improved contribution from Airtel › S$506m Net profit › +6% Up 13% in constant currency › S$872m Underlying net profit › +4% Up 11% in constant currency › S$910m › Free cash flow 2 Lower capital expenditure +7% › › S$712m Higher dividends from associates 1. Excluding exceptional items. 4 2. Adjusted to exclude payment of S$143 million to NetLink Trust in consideration of tax benefits utilised by the Group. The S$143 million was subsequently applied by NetLink Trust towards its acquisition of OpenNet.

Foreign exchange movements Quarter ended 9 months ended 31 December 2013 31 December 2013 (Depreciation)/ (Depreciation)/ Exchange Exchange appreciation appreciation Currency rate 1 rate 1 against S$ against S$ YoY QoQ YOY 2 1 AUD 1.1587 (8.8%) (0.2%) 1.1851 (7.5%) IDR 9,259 (17.6%) (10.2%) 8,448 (10.8%) INR 49.5 (12.0%) (1.4%) 48.1 (10.1%) PHP 34.8 (3.3%) (0.9%) 34.1 (1.2%) THB 25.4 (1.2%) (2.4%) 24.7 1.2% 1. Average exchange rates for the quarter and nine months ended 31 December 2013. 5 5 2. Average A$ rate for translation of Optus’ operating revenue.

Group Q3 FY14 highlights Group Consumer › Number of Fibre broadband customers in Singapore now Revenue EBITDA exceeds ADSL S$2,668m S$805m › 4G services for prepaid customers in Singapore and Australia -11% +1% Group Enterprise › Won significant projects in Singapore, Hong Kong and Australia Revenue EBITDA › Singapore’s largest SME portal won ASEAN ICT S$1,548m S$513m Stable +3% Gold Award Group Digital L!fe › Launched mio TV’s first original lifestyle TV production “Are You Hokkien”? Revenue EBITDA S$48m (S$42m) › Launched mobile gaming platform with personalised +40% +177% recommendation and operator billing capabilities 6

Solid earnings growth 3 months to 9 months to YoY % YoY % Dec 13 Dec 12 change Dec 13 Dec 12 change 4,263 4,597 (7.3%) 12,720 13,702 (7.2%) Operating revenue 1,264 1,262 0.1% 3,858 3,771 2.3% EBITDA - margin 29.6% 27.5% 30.3% 27.5% Associates pre-tax earnings 1 531 486 9.4% 1,621 1,566 3.5% EBITDA & share of 1,803 1,748 3.1% 5,493 5,337 2.9% associates’ pre -tax earnings Depreciation & amortisation (533) (524) 1.8% (1,599) (1,577) 1.4% (34) (78) (56.8%) (138) (234) (41.2%) Net finance expense 1,236 1,147 7.8% 3,756 3,526 6.5% Profit before EI and tax (326) (272) 19.7% (1,062) (915) 16.1% Tax 910 874 4.0% 2,690 2,610 3.1% Underlying net profit (37) (47) (21.4%) 64 30 112.4% Exceptional Items (post tax) Net profit 872 827 5.5% 2,754 2,640 4.3% 7 1. Excludes exceptionals.

Agenda 01 // Overview 02 // Group Consumer 03 // Group Enterprise 04 // Group Digital L!fe 05 // Financial Position and Outlook 06 // Supplementary Information 8

Group Consumer: Strong EBITDA growth Q3 FY14 Singapore Australia Revenue › Continued strong performance in Singapore S$2,668m S$607m A$1,779m with mobile service revenue up 6% -11% +4% -7% › Australia mobile service revenue down 4% › Down 5% in constant currency EBITDA › Continued strong cost management S$805m S$159m A$562m › Lower handset subsidies +1% +14% +8% › Up 9% in constant currency EBITDA margins 30.2% 26.2% 31.6% +3.7ppts +2.3ppts +4.3ppts EBIT S$455m S$101m A$309m +2% +19% +8% 9

Singapore Consumer: Continued momentum in mobile and consumer home services Revenue S$607m Consumer home revenue S$123m › Up 4% › Up 4% Revenue Customers Customers on triple bundles (‘000) (S$m) +4% S$123m S$607m S$585m 120 380 S$118m mio TV 100 360 364 Revenue (S$m) 359 Mobile Comms 322 353 304 80 340 347 338 Fibre 60 320 Fixed 1 125 121 ADSL 40 300 56 International Tel 59 20 280 Sale of Equipment 104 99 and Others Fixed Voice Q3FY13 Q3FY14 0 260 Q3FY13 Q4FY13 Q1FY14 Q2FY14 Q3FY14 Household ARPU S$56 EBITDA S$159m › Up 7% › Up 14% 364k Households on bundles › Up 8% 10 1. Fixed services revenue comprises Internet, National Telephone and mio TV.

Australia Consumer: strong EBITDA growth and driving improved customer experience Revenue EBITDA A$1,779m A$562m › down 7% › up 8% on lower selling costs › Optus My Plan (tiered data) gains good traction and -7% promotes higher data usage 2 1,910 1,779  572k customers 3 representing 22% penetration of Revenue (A$m) branded postpaid voice customers Mobile 1,161 1,115 Service  Approx. 27% of customers “tiered up” 4 during Q3 › Improved customer experience 267 215 Mobile Equipment  Market NPS 5 registers 6 point improvement 482 449 Fixed  Overall TIO 6 complaints reduced by over 50% 7 Q3 FY13 Q3 FY14  Roaming revamped with Optus “Travel Packs” Mobile Service Revenue down 4% › DRP 1 credits -1% › MTR 1 decline -2% 3. As at 31 December 2013 4. Moved to a higher data tier for at least 1 month due to exceeded data allowance 5. Net Promoter Score 1. Device Repayment Plans; Mobile Termination Rates 11 6. Telecommunications Industry Ombudsman 2. Comparing monthly average data usage against other key Optus plan types 7. YoY comparison for the 3 months ended 30 September 2013

Regional mobile associates – customer growth 501 million mobile customers… across 25 countries 9% 5% 199m 11% Mobile customers (m) 132m 14% 16% 77m Growth in customers (%) 41m 38m India International 1 12 1. International comprises operations across Africa and South Asia (Sri Lanka and Bangladesh).

Strong contributions from regional mobile associates PBT 1 % Change % Change Q3 FY14 Highlights (S$m) (S$) (local curr) › up 24% in constant currency Regional 506 +11% N.A. › improved contribution from Airtel Mobile › increase in revenue and EBITDA driven by voice Telkomsel 214 (15%) stable and data growth offset by network charges › India: strong operating momentum; higher ARPU from improved voice rates and increased data usage Airtel 148 +113% +139% › Africa: operating revenue up on data growth; offset by higher network and selling costs › higher mobile data usage AIS 106 +1% +3% › earnings impacted by higher 3G roll-out costs › strong customer growth and take-up of mobile data services Globe 2 39 +26% +31% › higher staff costs and customer acquisition costs Excluding exceptional items – compared to 3 months to Dec 2012. 1. 13 Globe’s accelerated depreciation arising from network modernisation & IT transformation has been classified as a Group exceptional item. 2.

Agenda 01 // Overview 02 // Group Consumer 03 // Group Enterprise 04 // Group Digital L!fe 05 // Financial Position and Outlook 06 // Supplementary Information 14

Group Enterprise: resilient performance Q3 FY14 % growth › Cautious business environment and keen Revenue competition S$1,548m Stable › Up 3% in constant currency › Operating expenses down 2% EBITDA › One-off credits S$513m +3% › Up 4% in constant currency EBITDA margins 33.1% +1.0 ppt EBIT S$344m +4% 15