By Kimberley Kao and Ronnie Harui

Singapore's largest mobile network operator is facing headwinds from its Australia operations but that hasn't deterred it from raising full-year earnings guidance after a strong first half.

Singtel now expects operating company earnings before interest and taxes to grow more than previously anticipated, despite uncertainties stemming from a series of outages at Optus, its Australia subsidiary.

Optus suffered network outages in September that fatally disrupted emergency calls, the latest in a series of run-ins with regulators this year.

There will be some cost pressures at Optus in the near term, Singtel's group chief executive, Yuen Kuan Moon, said at a press briefing on Wednesday.

"Because of the triple zero outage, we are spending more to make sure that we improve the resilience," such as adding call center agents in Australia and investing in the reliability of the network, Moon said. "This will have some immediate impact in the second half."

Still, Singtel has tweaked its projections for the financial year ending March, now seeing up to low double-digit growth in Ebit. That compared to prior guidance for high single-digit growth.

Shares of the telco were last 1.7% higher at S$4.70 in Singapore, on track for a record-high close.

Singtel is "in a comfortable position" to deliver more than 4% yield, and that's before factoring in its share-buyback program, Citi Research analysts Arthur Pineda and Luis Hilado said in a note. "This potential growth in dividend remains a key focus point for investors."

During the fiscal first half ended in September, Singtel's net profit nearly tripled to 3.40 billion Singapore dollars, equivalent to US$2.61 billion. That was driven by exceptional gains of S$2.05 billion, mainly from the sale of a partial stake in India associate Bharti Airtel and from the Intouch-Gulf Energy merger.

Singtel's digital infrastructure unit also posted earnings growth during the period thanks to healthy demand for data centers and customer renewals, as well as contributions from its artificial-intelligence cloud business.

Investors will be keeping an eye on developments pertaining to Optus, which is in the midst of a senate inquiry and an independent review over the network outages in Australia.

Singtel's Moon said the incident has had an impact on "the confidence of the Australians on Optus as a company, as a brand," adding: "We believe if we do the right thing and be totally transparent about it and improve on our performance, customers will come back."

Optus accounts for about half of Singtel's operating revenue, and contributes about 5%-6% to underlying profits, Singtel Group Chief Financial Officer Arthur Lang said at the briefing. Singtel's first-half operating revenue declined 1.2% to S$6.91 billion compared to a year earlier.

"We really need to do better and the Optus team has to do better. But [as] a portfolio of our business, it has a modest impact," Lang said.

Write to Ronnie Harui at ronnie.harui@wsj.com and Kimberley Kao at kimberley.kao@wsj.com

(END) Dow Jones Newswires

November 12, 2025 02:00 ET (07:00 GMT)

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