By Amanda Lee and Kimberley Kao

Singapore telecommunications company Singtel said that it is open to selling a stake in Optus, its Australian telecom unit, after it posted sharply higher annual profits that were lifted by exceptional gains.

Singtel has been considering bringing on a local partner for its Australian operations, chief executive Yuen Kuan Moon said at a post-earnings briefing Thursday.

"There are always a lot of [potential] partners talking to us," Yuen said. Combining Singtel's strengths with a partner can "make Optus much stronger and better," he said. "We still remain fully committed in Optus."

Optus, which contributes about half of Singtel's operating revenue, has been under scrutiny in recent months.

Optus suffered several network outages last year, including one in September which affected emergency calls. Last June, Optus agreed to a US$65 million penalty, admitting that it sold unsuitable products to vulnerable individuals, including indigenous Australians.

Singtel said that any potential Australian partner should be aligned with its objectives to ensure that Optus remains a strong, reliable Australian operator.

The comments came as Singtel posted a 40% jump to S$5.61 billion, equivalent to $4.39 billion, in its net profit for the fiscal year ended March. The results were buoyed by a net exceptional gain of S$2.84 billion, largely from stake sales in its Indian associate Airtel, though this was partly offset by provisions related to its Australian operations.

Without the exceptional gain, underlying net profits rose 12%, while operating revenue increased 0.8%.

Looking ahead, Singtel is taking a more cautious near-term outlook. It expects earnings before interest and taxes growth to be between low and mid-single-digits for fiscal year 2027, due to the uncertainty from the Middle East conflict.

While it has no operations in the region, Singtel said it is closely watching for potential second-order effects on the economy, which could affect consumer discretionary income and cause inflationary pressures on expenses.

Markets gave the results a thumbs down and sent Singtel's shares down as much as 7.0% to S$4.66, putting it on track for its biggest one-day percentage loss since August 2011.

Underlying profits for Singapore's largest mobile network operator were slightly lower than consensus expectations, according to analysts from Citi in a note. They said this was mostly because of price competition in Singapore's consumer segment.

Singtel's chief financial officer Arthur Lang at its post-earnings briefing added that it is looking at new funding sources to drive growth, including potential initial public offerings, as part of its capital management plans.

He added there were no concrete plans for any IPOs of its businesses but such a move could target Singtel's more capital intensive businesses, such as its digital infrastructure segment.

Write to Amanda Lee at amanda.lee@wsj.com and Kimberley Kao at kimberley.kao@wsj.com

(END) Dow Jones Newswires

May 21, 2026 02:07 ET (06:07 GMT)

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