SG Morning Highlights | Singtel Reports 64% Drop in Full-Year Net Profit Due to Impairment Charges from Optus

Singapore shares opened higher on Thursday. The $FTSE Singapore Straits Time Index (.STI.SG)$ dropped 0.23 percent to 3300.43 as at 9:08 am.

$Singtel (Z74.SG)$: Singapore Telecommunications (Singtel) has reported a 64% drop in full-year net profit due to a $3.1 billion impairment charge, most of which came from its Australian subsidiary Optus. The company's net profit for fiscal 2023 was $795 million, compared with $2.23 billion a year ago, as a result of an exceptional loss of $1.47 billion, comprising a $2 billion provision on the goodwill of Optus and $470 million for Optus’ enterprise fixed access network assets. However, excluding the impairment charges, underlying net profit rose 10% to $2.26 billion, reflecting increased regional associate contributions and higher interest income. Singtel's directors have proposed a final dividend of 9.8 cents per share, bringing the total dividend payout to 15 cents for fiscal 2024, a 52% increase year-on-year.

$SIA (C6L.SG)$: A Singapore Airlines flight from London to Singapore was forced to divert to Bangkok after hitting severe turbulence on May 21. One passenger died of a suspected heart attack and 30 were injured, seven of them critically. The turbulence occurred over the Irrawaddy Basin in Myanmar about 10 hours into the flight. The pilot declared a medical emergency and diverted the aircraft to Bangkok. The airline said it had encountered turbulence after falling into an air pocket while cabin crew were serving breakfast. Singapore's Transport Safety Investigation Bureau will deploy investigators to Bangkok to look into the incident.

$Sembcorp Ind (U96.SG)$: Sembcorp's Indian wind-power unit, Green Infra Wind Energy Limited (GIWEL), is facing an additional counterclaim by Siemens Gamesa Renewable Power Private Limited, increasing the total counterclaim against the subsidiary to approximately $365.4 million. Sembcorp Industries, which owns GIWEL, stated that the arbitration is not expected to have any material adverse impact on GIWEL's financial results, and no provisions have been made in relation to the arbitration. GIWEL maintains its confidence in defending against the new claim, and the Sembcorp management has assessed the probability of the vendor's success in the additional counterclaim as remote.

$Seatrium Ltd (5E2.SG)$: Seatrium Limited has secured a long-term strategic partnership agreement, in the form of a Favored Customer Contract (FCC), with Hyundai LNG Shipping. The contract involves the upgrade and refit of a series of LNG carriers over the next two years, with Seatrium responsible for joint planning, information, and experience sharing with Hyundai. The two companies will work together towards achieving sustainable targets in the areas of quality, health, safety, and environmental sustainability. The first LNG retrofit under the FCC agreement is scheduled for repairs in Seatrium's Admiralty Yard in Singapore, with Hyundai Utopia set to begin repairs in May 2024.