To The Moon

Three of Singapore's most prominent blue chip companies are scheduled to release their results within a three-day window this month.

Singapore Telecommunications Limited, or Singtel, SATS Ltd., and Singapore Airlines Limited, or SIA, all count Temasek as a major shareholder.

Temasek is a global investment firm based in Singapore.

As of 2 June 2026, it holds 50.6% of Singtel and 50.6% of SIA.

It also has a deemed interest of 40.3% in SATS as of 19 May 2026.

What they do not share, however, are the same pressures.

For reference, all three companies last reported on the first quarter of fiscal 2027 (1QFY2027), which concluded on 30 June 2026.

Two of the three experienced the impact of Middle East tensions.

Can Singtel continue to exceed its own guidance?

Singtel started the year strong.

Operating profit increased 10% year on year (YoY) to S$462 million in 1QFY2027.

That is ahead of management's guidance for low- to mid-single-digit growth for the full year.

Underlying net profit rose 21% to S$831 million.

So where did this growth originate? Singtel's growth engines.

IT services arm NCS grew operating profit 29% YoY to S$102 million on improved delivery margins.

Optus contributed 14% more at A$152 million on stronger mobile performance.

In Singapore, Singtel Singapore's operating profit dipped 2% to S$230 million amid intense price competition.

Revenue grew 5% to S$3.6 billion, although on a constant-currency basis, it was flat.

In other words, currency movements drove the top-line growth.

On 13 November, first check whether operating profit is still running ahead of guidance.

Then check whether the decline in Singapore has levelled off.

Keep an eye on capital management as well.

Singtel has raised around S$6.8 billion of its S$9 billion asset-recycling target and has used 41% of its S$2 billion buyback.

Up to S$3.3 billion in value realisation dividends is still to come through to FY2030.

Remember, Singtel pays dividends only at the half-year and full-year marks.

Will SATS convert profit growth into cash?

SATS expanded its business, but its cash did not follow.

Revenue rose 11.3% YoY to S$1.7 billion in 1QFY2027 on new client wins and shifting trade flows.

Net profit increased 6% to S$75.1 million.

Here is the catch: free cash flow came in at negative S$22.6 million.

Operating cash flow after lease repayment fell to S$23.2 million from S$45.8 million a year ago.

SATS attributed this to the timing of working capital.

On 11 November, look for signs of a recovery.

Margins are the next thing to watch.

Operating margin narrowed to 8.0% from 8.3% a year ago.

Middle East disruptions to cargo flows and inflationary pressure weighed on margins.

Management has also cautioned that inflationary pressures could add to costs in the coming quarter, and that the Middle East situation is weighing on aviation demand.

SATS carried S$4.2 billion of total debt as at 30 June 2026.

Gross debt to equity held steady at 1.41 times.

It held S$726.0 million in cash, which puts net debt, including leases, at about S$3.5 billion.

SATS declared no dividend in 1Q, the same as a year ago.

Can SIA's fares keep up with fuel costs?

SIA's 1QFY2027 business update showed record revenue of S$5.7 billion, up 19.3% YoY.

The group still swung to a net loss of S$75.8 million, from a profit of S$186.1 million a year ago.

How does an airline lose money on record revenue? Fuel.

Net fuel expenses rose 78.5%, or S$991 million, as jet fuel prices spiked on the back of the Middle East conflict.

SIA's share of Air India's wider losses added to the pressure.

SIA did push back with higher prices.

Passenger yields improved 12% YoY, and cargo yields rose 28.1%.

Management flagged, though, that fare adjustments cannot fully offset higher fuel prices.

So on 11 November, the key question is whether higher yields can narrow the gap.

On the flip side, SIA's cash flow tells a happier story than its profit; the airline generated about S$810 million of free cash flow.

As at 30 June 2026, it held S$9.1 billion in cash and bank balances against total debt of S$10.7 billion.

SIA pays dividends only at its half-year and full-year results.

If you own the shares for income, watch which one any dividend decision tracks: the profit or the cash.