Singapore Telecommunications, Southeast Asia's largest phone company, beat market expectations with a 9.2 percent rise in quarterly profit due to rapid mobile user growth in Asia.
State-controlled SingTel, which derives about three quarters of its sales and two-thirds of pretax earnings from operations outside Singapore, kept its target of delivering double-digit underlying earnings growth over the medium term.
But it raised its dividend payout ratio to 45-60 percent of underlying net profit, from 40-50 percent.
"The environment remains challenging with the outlook for the global economy looking more uncertain," Chief Executive Chua Sock Koong said, adding that the group's fundamentals remained strong.
Singapore's largest listed firm said fourth-quarter attributable net profit was S$1.09 billion ($796 million) versus S$989 million last year, bringing full-year 2007/08 net profit to S$3.96 billion, up 4.8 percent.
The company made underlying net profit before goodwill and exceptionals of S$968 million in the January-March quarter, compared with S$886 million in the year-ago period.
This was above an average net profit forecast of S$856.6 million from 14 analysts polled by Reuters. Operating revenue rose 11 percent to S$3.76 billion.
Facing a domestic market of just 4.6 million people where virtually everyone has a mobile phone, SingTel has spent S$18 billion in recent years buying stakes in mobile operators in high-growth Asian countries like India and in the bigger Australian market.
Optus, Australia's second-largest mobile operator and SingTel's single-biggest revenue and profit generator, posted a 1.4 percent rise in full-year earnings before interest, tax, depreciation and amortisation (EBITDA) to A$2.02 billion ($1.9 billion), excluding a A$13 million write-off for a cancelled government contract.
The unit, which holds a third of the mobile market, faces cut-throat price competition, slowing subscriber growth and regulatory changes in a saturated Australian market, where more than eight in 10 people own a phone.
Besides Optus, SingTel also owns big stakes in six emerging market mobile operators, including Globe Telecom in the Philippines, and Indonesia's Telkomsel. Most have shown phenomenal growth in wireless subscribers in recent years.
Pretax earnings from the associates rose 18 percent to S$630 million in the quarter, driven mainly by Bharti and a 2 percent appreciation of the Indian rupee against the Singapore dollar.
SingTel also benefited from an exceptional gain of S$153 million from the sale of Bharti's minority stakes to investors in a subsidiary.
SingTel shares fell more than 2 percent in January-March, outperforming a 13 percent drop in the benchmark Straits Times Index.