On 29th April 2024 (Monday) before trading commences, Singtel Group just announced that it will be taking up impairment provision of approximately S$3.1 billion for its 2nd half financial year ending 31 March 2024. While these non-cash impairment does not impact current cashflow or upcoming dividends, a huge chuck of net assets per share has been wiped off. Previous CAPEX and investments have declined in valuation due to drop in fixed carriage revenue generation and the associated plunge in future cashflow.

1. Optus main culprit

(i) The Optus Enterprise segment has been badly hit due to the prevailing Australian market. As a result, Optus reported steep declines in its fixed carriage revenue. It will be taking up <S$470Mil> impairment for its Enterprise fixed assets. (ii) The plunge here further triggered Singtel impairment review of its goodwill in Optus. Goodwill refers to the excess over the book value of Optus during its acquisition back in 2001. Coupled with higher discount...