To survive in the era of technology disruption, Singtel in recent years has shifted its growth strategy from investing in overseas telecom companies to expanding its digital businesses.
Singtel reported on Thursday that its net profit for the quarter ended September nearly tripled to 2.88 billion Singapore dollars ($2.12 billion) from the same period a year earlier, its highest quarterly net profit ever. The company attributed the jump to an exceptional gain of S$2.05 billion from the sale of its stake in NetLink Trust, a Singapore fiber-optic network operator.
Excluding the exceptional gain, Singtel’s net profit declined 4.1% due to a weak contribution from its Indian affiliate, Bharti Airtel, which faced tough competition.
Singtel’s information-communication technology operations, which includes cybersecurity, and its digital business segment together made up a quarter of the company’s total revenue for the July-September period. “It is a confirmation [of the] momentum that we are seeing in our digital efforts,” Chua told a press conference on Thursday.
Owing to contributions from its purchases, Singtel’s sales from its cyber-defense business for the year ended March 2017 grew 84% to S$473 million from the same period a year earlier. For the fiscal half-year ended September, growth slowed to 3.3% from the year-earlier period, but the company expects that pace to speed up, with the segment’s revenue reaching between S$550 million to S$650 million for the current fiscal year ended March 2018.
Asian businesses have lagged in addressing cyber threats compared with their Western counterparts. It took organizations in the Asia-Pacific region 172 days, or 1.7 times longer than the global median of 99 days, to discover a security breach last year, according to a report by U.S. cybersecurity company FireEye. But attention to the issue is growing rapidly, as the threats become more frequent and more complex. Last year, $81 million was illegally transferred from a Bangladesh central bank foreign-reserve account at the Federal Reserve Bank of New York, and major international cyberstrikes earlier this year — by ransomware dubbed “WannaCry” — affected Asia as well, including one on gas stations’ payment systems in China. Singtel sees these growing cybercrimes as an opportunity.
Singtel has also tied up with FireEye and Palo Alto Networks, both California-based cybersecurity companies, in an effort to gain the latest technology. Singtel also is looking to tie up with its subsidiaries in India, Indonesia and Thailand — as it did in the Philippines — to offer advanced cybersecurity services in other Asian markets.