The oldest telco in Singapore has been issuing dividends ever since the turn of the millennium. Here’s all you need to know about Singtel’s share prices, dividend payouts.
To say that Singtel is a household name is a gross understatement. The company has been plying its trade ever since the late-1800s, even having a stranglehold on the local telco scene until the Government deregulated the industry in 1997. By then, Singtel was already a publicly-listed company on the SGX and would begin to issue dividends three years later.
Fast-forward to 2021 and things are a lot more complex for the red team. Intense competition and COVID-19 are two of the biggest spanners in Singtel’s works but the firm has held firm and proceeded with its dividend payouts even in 2020 and 2021.
Financial institutions like DBS and OCBC have given their stamp of approval as well, predicting a bullish 2021 for the telco.
To better understand the nuances and historical performances of Singtel's shares and dividends , here’s the full lowdown.
- Singtel’s share prices across the past five years
- Singtel’s dividend history
- Singtel’s dividend payout schedule
- Risks of investing in Singtel
- What does the future hold for Singtel?
- Closing thoughts
Singtel’s share prices across the past five years
|2021 (January to mid-September)||S$2.21 - S$2.63|
|2020||S$2 - S$3.39|
|2019||S$2.85 - S$3.56|
|2018||S$2.87 - S$3.65|
|2017||S$3.56 - S$4.02|
When viewed from 2017 to September 2021, Singtel’s share prices are far from encouraging. The telco’s stock has been in free fall for the past five years, even without a global pandemic and recession shaking things up.
This is very similar to the behaviour that StarHub’s stock prices have displayed across the same period of time.
As mentioned in that article however, share prices aren’t the only thing that are crucial when deciding whether to add a dividend-paying stock to a portfolio. There is also a need to take a look at how the company is performing from a financial standpoint and that’s where other pieces of information come into play.
With regards to gross profit, Singtel has held relatively steady. It raked in S$10.28 billion across three quarters in 2021 despite COVID-19-related issues. However, it’s still a ways off from its S$12.38 billion and S$12.18 billion performances in 2018 and 2017 respectively. Like StarHub, Singtel is banking on a successful 5G rollout and hoping that it’ll be a good shot in the arm.
Singtel’s total assets tell a similar story, at S$47.99 billion. Across the past five years, the telco’s total assets have been increasing marginally, starting at S$48.29 billion in 2017 and ending up at S$48.95 billion in 2020. However, liabilities have increased slightly as well, from S$20.08 billion in 2017 to S$21.49 billion in 2021.
The company has its fingers crossed that its overseas investments will succeed and roaming revenue will return at an even faster pace as Singapore ramps up its reopening plans.
Singtel’s dividend history
|Year||Dividend Yield||Total Dividend Payout (Per Share)|
|2021||1.01% (not finalised)||S$0.024 (not finalised)|
The company’s dividend policy aims to ensure that 60% to 80% of its underlying net profit will be paid out to shareholders.
Its first dividend payout in 2021 amounted to S$833 million, or S$0.051 per share. The STI constituent distributed close to 100% of its underlying net profit (April – September 2020) to shareholders despite the novel coronavirus battering economies worldwide.
The telco’s second dividend payout in August 2021 was much more modest, at a total of S$396 million. This amounts to roughly S$0.024 per share. The next dividend announcement will be made in November, with payouts disbursed in January 2022.
In a pre-COVID-19 world however, Singtel’s dividends were consistently clocking in at above S$0.15 per share.
Singtel also launched its own scrip dividend scheme in 2021, giving investors the opportunity to receive payouts in the form of shares rather than cash.
For example, if you were holding on to 1,000 lots in Singtel and opted into the scheme, you would’ve received 21 shares based on the scrip price of $2.422. That’s a S$0.07 discount per share based on how much Singtel was trading at on the day it paid its dividends out.
Unfortunately, the scrip price is higher than what Singtel is trading at in September 2021.
Singtel’s dividend payout schedule
|Interim Dividend Payout (annual)||Final Dividend Payment (annual)||Other Dividend Payouts (ad-hoc)|
|Mid-January||Mid-August||Late-August (Special Dividend 2011)|
Mid-January (Special Dividend 2018)
Singtel gives out two payments every year:
1. In January after it consolidates its performance for the first half of the financial year
2. In August after wrapping up its AGM
With regards to ad-hoc payments, the company distributed a special dividend in August 2011 and January 2018. The former was due to Singtel having a ‘lack of suitable acquisition opportunities’. Fortunately, the latter came on the back of good news as Singtel celebrated a record net profit in the second quarter of 2017.
These special dividends are truly special in every sense of the word because it requires Singtel to reach new heights regarding business performance. That isn’t easy to achieve, given the packed telco landscape in Singapore right now.
However, the company has been investing in nations across the Asia-Pacific region, so investors might receive good news in a few years.
Risks of investing in Singtel
Although Singtel appears to be the embodiment of consistency, its shares aren’t exactly bulletproof. This is no different from any other investment, be it precious metals or ever-volatile cryptocurrencies. Furthermore, competition among telcos is stiff, with Singtel battling on multiple fronts against its traditional rivals and an increasing number of MVNOs.
As a result, its share price has been dropping ever since it hit record highs in 2015. In fact, the very opposite was observed, with record lows nearly seen in October 2020. Across three quarters in 2021, Singtel’s share prices still remain in the doldrums although it never looked like it was going to hit rock-bottom again.
Singapore’s successful vaccination programme in 2021 didn’t do much to jumpstart its share prices and regional investments will take time to recover. The country is still opening up gingerly as compared to its western counterparts.
Naturally, there’s also the worry that it might never hit its all-time high again, much less surpass it.
What does the future hold for Singtel?
It’s no secret that Singtel would like to recapture the same mojo that brought it remarkable growth circa 2006-2007 and 2009-2015. In a bid to do just that, the firm announced an organisational restructure in December 2020.
The move aimed to capitalise on its commanding 5G presence in Singapore and allows it to discover new growth opportunities in the region.
As part of this organisational restructure, NCS, Singtel’s ICT arm, started reporting directly to the Singtel’s CEO from 1 January 2021 onwards. Additionally, Singtel’s International Group was brought under the Group CFO’s office on 1 April 2021. Lastly, more appointments were made to the company's management committee.
With organisational restructuring, in addition to the increasing vaccination rates, Singtel could potentially stop the bleeding and go on a sustained bull run that facilitates a desired long-term growth.
Unfortunately, this move has not borne fruit yet as the rest of the Asia-Pacific region is still in a precarious position. It’s the same situation locally, with Singapore still struggling with reopening despite its high vaccination rates.
In a news release published on 27 May 2021, Singtel shared its concerns when discussing its outlook for FY2022, saying, “The resurgence of COVID-19 and tightened movement restrictions continue to weigh on regional economies. Against this backdrop, the operating environment remains challenging for the telecoms sector, as companies confront structural changes and elevated capital investment cycles.”
The company and investors will hope that it’s just a matter of time that the moves they made will pay dividends, both literally and metaphorically.
|Dividend Yield (2011 - 2020)||Amount Paid Per Share (2011 - 2020)||Share Price (2011 - 2020)|
|Ranged from 4.4 – 10.75%||Ranged from S$0.106 - S$0.258 cents per share||Ranged from S$2 to S$4.57|
The telco has been operating for over a century and publicly-listed on the SGX for more than 20 years. This has translated into a dividend yield that never dipped below 4.4%, even during a pandemic and recession.
The landscape might be challenging for Singtel locally and regionally, but unlike its green- and yellow-hued competitors, it has devoted a lot more money to regional investments and projects. Its share prices aren’t performing well, but it’s not for a lack of trying.
Throw in a greater focus on Australia and China moving forward and there’s even more reason to hope.
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