SINGAPORE (Nov 14): Singapore Post saw its earnings fall 9.5% to $28.5 million in the 2Q ended September, down from $31.4 million a year ago.
This was due to the absence of a one-off gain a year ago from the dilution of interest in an associated company.
Excluding such exceptional items, underlying net profit rose 1.9% to $27.6 million.
Revenue grew 10.2% to $354.7 million, from $321.7 million a year ago, led by growth in the postal and logistics segments.
Postal revenue rose 16.9% to $148.3 million as international mail revenue rose on the back of higher cross-border ecommerce deliveries, largely mainly to higher volumes from the Alibaba Group.
Logistics revenue increased 7.6% to $165.9 million with higher last-mile ecommerce deliveries across Singapore and Australia, as well as higher freight forwarding volumes.
Revenue from ecommerce dipped 0.8% to $63.5 million. This was mainly due to a decline in revenue from TradeGlobal following the loss of two large customers, partially mitigated by revenue growth at Jagged Peak with higher volumes and addition of new customers.
Total expenses grew 14.7% to $341.4 million largely due to the increase in volume-related expenses, as the group seeks to grow volumes to benefit from economies of scale from operating leverage.
Finance expenses rose to $2.8 million in 2Q, compared to $0.1 million a year ago. This was mainly due to unfavourable non-trade related foreign translation differences.
As at end September, cash and cash equivalents stood at $282.3 million.
For the 2Q, SingPost has declared an interim quarterly dividend of 0.5 cent, to be paid on Dec 8. This is half of the interim quarter dividend of 1.0 cent a year ago.
This bring total dividend in 1H to 1.0 cent, 60% lower than the dividend of 2.5 cents in the corresponding half-year period last year.
Earnings per share fell to 1.09 cent in 2Q17/18, down from 1.28 cent a year ago.
“Our transformation into a leader in postal and ecommerce logistics is moving ahead. The full benefits of our transformation may not be immediate, however we are investing for the long term,” says group chief executive officer Paul Coutts.
“As we move into the next phase of our transformation, four themes will guide our focus: Winning in our home market, igniting our future growth engines in Southeast Asia and beyond, extracting full value from our investments, and driving towards cost leadership,” he adds.
Shares of SingPost closed flat at $1.30 on Tuesday.
