Nov. 11 (Bloomberg) -- Singapore Telecommunications Ltd., Southeast Asia’s largest phone company, posted the highest profit in six quarters, helped by demand for mobile services at home and in Australia.

Net income rose 10 percent to S$956 million ($689 million) in the three months ended Sept. 30, the company said today. SingTel was projected to post second-quarter profit of S$982 million, according to the median of three analyst estimates compiled by Bloomberg.

Products such as Apple Inc.’s iPhone and multimedia services for SingTel’s pay-television customers are driving consumer demand, countering weakening growth for corporate voice and data sales. The company yesterday said wireless subscribers rose 26 percent after it added clients in Australia, Indonesia, India and Singapore.

“SingTel is an emerging-markets mobile growth story and that is panning out well for them,” said Theo Maas, who helps manage $4.6 billion at Fortis Investment Partners in Sydney, including SingTel stock. “They’re being very aggressive on the iPhone and are clearly winning market share.”

The company expects full-year Australian and Singapore revenue and earnings before interest, taxes, depreciation and amortization, or EBITDA, to grow at a “single digit level.”

SingTel rose 0.7 percent to S$2.96 as of 12:18 p.m. in Singapore trading. The stock has gained 16 percent this year, underperforming the 54 percent increase in the benchmark Straits Times Index.

Singapore Earnings

The company derives 26 percent of earnings from Singapore, 29 percent from Australia, with the rest coming from regional mobile units such as Bharti Airtel Ltd.

In Singapore, second-quarter EBITDA increased 11 percent to S$556 million, while sales gained 8 percent to S$1.4 billion. SingTel’s share of the domestic market rose to 46.2 percent at the end of September from 45.9 percent in June.

The company last month announced it will broadcast ESPN programs and Barclays Premier League soccer games next year to subscribers of mio TV, its Internet-based pay television service, as part of SingTel’s expansion in multimedia.

SingTel added 25,000 mio TV customers in the period for a total of 126,000 subscribers, the company said.

‘Strong Domestic Momentum’

“The Singapore domestic business has strong momentum and should continue to take market share from the smaller players,” Daniel Baker, an analyst at Mirae Asset Securities in Hong Kong, wrote in a report yesterday.

Last month, MobileOne Ltd., the smallest of Singapore’s three telephone companies, said it reached an agreement with Apple to offer the iPhone in the city-state. SingTel was previously the only company offering the device on the island.

Carey Wong, an analyst at Oversea-Chinese Banking Corp., wrote in a report last month the MobileOne move wouldn’t significantly affect SingTel’s profit or market share.

EBITDA at its Australian unit, Sydney-based SingTel Optus Pty., rose 6 percent to A$509 million ($473 million), bolstered by increased sales of the iPhone.

Australian capital spending for the year is forecast at A$1.1 billion, while expenditure in Singapore will be less than S$800 million.

Australian Unit

Revenue from Optus’s corporate voice business declined 8 percent because customers “continued to rationalize” spending, SingTel said in a statement. Sales from companies’ data services in Singapore rose 4 percent, compared with 9 percent growth in the preceding quarter, according to SingTel.

There are no immediate plans to sell part or all of Optus, while Africa is a “market we are interested in,” Chief Executive Officer Chua Sock Koong said today.

“As a group we do review the investments that we have,” she told reporters on a conference call. “We look at whether any form of divestment would be value accretive, but no decision has been made on Optus.”

Pretax earnings from Bharti Airtel, in which SingTel holds almost a one-third stake, rose 26 percent to S$236 million. While India’s biggest phone company increased its mobile customer base by 43 percent, average revenue per user fell as competition intensified, SingTel said today.

SingTel said Oct. 30 it agreed to increase its stake in Bharti Airtel to 31.95 percent from 30.43 percent.

Bharti, Telekomunikasi

Bharti in September called off talks for a proposed merger with MTN Group Ltd., Africa’s biggest wireless company, after failing to get South African government approval.

SingTel said its share of pretax earnings from PT Telekomunikasi Selular, Indonesia’s largest mobile-phone operator, rose 46 percent to S$252 million as the number of subscribers grew.

SingTel, which approved an interim dividend of 6.2 Singapore cents a share, said today it plans to keep its dividend payout ratio from 45 percent to 60 percent of underlying earnings.

To contact the reporters on this story: Kevin Cho in Seoul at kcho2@bloomberg.net; Robert Fenner in Melbourne rfenner@bloomberg.net

Last Updated: November 10, 2009 23:19 EST