Singapore  - Singapore Telecommunications Limited (SingTel) on Thursday said its net profit for the first quarter 2009 rose 7.7 per cent over a year ago, but warned that its operating environment remained challenging.

For the first quarter ended June 30, Southeast Asia's biggest telecommunications company posted a net profit of 945 million Singapore dollars (655 million US dollars), up from 878 million Singapore dollars a year earlier, SingTel said in a statement.

SingTel attributed the rise to strong results in Singapore and from its wholly-owned Australian unit Optus, and the return to earnings growth by the group's regional associates despite a negative impact from currency translations.

Combined earnings from SingTel's six regional mobile associates - India's Bharti, Indonesia's Telkomsel, Globe in the Philippines, Advanced Info Service in Thailand, Pakistan's Warid and Pacific Bangladesh - reached 624 million Singapore dollars in the first quarter, up 12 per cent from a year ago, driven mainly by higher contributions from Telkomsel.

Group revenue in the first quarter rose 1.9 per cent year-on-year to 3.84 billion Singapore dollars.

"The group performed well and achieved earnings growth despite the uncertain economic environment and negative impact of the Australian dollar and regional currencies," said chief executive officer Chua Sock Koong.

However, "the current operating environment remains a challenge," she said.

As SingTel's home market is limited with about 4.8 million people living in Singapore, the company has invested heavily in recent years to buy stakes in mobile operators in rising Asian markets.

On Wednesday, SingTel announced that its combined regional mobile phone customer base grew by 33 per cent to more than 262 million customers as of June 30. (dpa)