ComfortDelgro – BT

ComfortDelGro Q3 profit up 15% to $59m

Bus, taxi operations in UK and Australia the star performers

COMFORTDELGRO’S net profit for the third quarter ended Sept 30 rose 15 per cent to $59 million compared with the corresponding period last year, with its overseas ventures turning in a strong performance.

The land transport giant said its bus and taxi operations in the UK and Australia were the star performers. Q3 revenue rose 6.3 per cent to $771.4 million, while operating profit increased 14.4 per cent to $93 million. Overseas operating profit now accounted for 52 per cent of total group operating profit.

‘For the first time, more than half of our group operating profits came from overseas,’ said ComfortDelGro managing director and group CEO Kua Hong Pak.

‘In fact, practically all our overseas businesses improved in their performance – particularly our Australian subsidiary which more than doubled its operating profit.’

The strength of the overseas contributions meant that overseas turnover accounted for nearly 48 per cent of total group revenue – up from 44 per cent a year ago and 47 per cent in the previous quarter. As a result, the group is close to achieving its long-stated goal of deriving half of its total revenue from abroad, a target set four years ago following the merger of Comfort and DelGro.

The group’s Q3 turnover from the bus business rose 10.6 per cent to $401.3 million due to higher contributions from its UK, Australia and China operations. In Singapore, turnover at SBS Transit grew 3 per cent as daily ridership increased, but operating profit was 44 per cent lower on higher repair and maintenance, depreciation and staff costs, as well as the GST hike.

The turnover for the group’s taxi business in Q3 was up 6 per cent to $230.7 million. In Singapore, turnover for the taxi business was 5.3 per cent higher at $141.4 million due to a younger operating fleet and an increase in corporate billings. Turnover from overseas taxi operations grew by 7.2 per cent in Q3, led by the UK and China.

The Q3 turnover for the rail business jumped 20 per cent to $22.8 million as average daily ridership on the North-east MRT Line grew steadily. But total operating expenses in Q3 crept up 5.3 per cent to $678.4 million, as staff costs increased 10.4 per cent to $242.2 million, payment for contract services spiked up 18.3 per cent to $65.8 million, energy and fuel costs rose 5.2 per cent to $57.1 million and repair and maintenance jumped 14.6 per cent to $45.6 million, among others.

For the first nine months, the group’s net profit was 12 per cent higher at $172.9 million, as revenue rose 7.8 per cent to $2.23 billion. Earnings per share in Q3 rose 14.5 per cent from 2.48 cents to 2.84 cents, while year-to-date earnings per share were up 11.7 per cent from 7.46 cents to 8.33 cents. No dividend has been recommended.

Looking ahead, Mr Kua said the group’s overseas operations will continue to drive revenue and profit growth. But depreciation expense is expected to increase with the introduction of new buses in Singapore. Repair and maintenance costs are also seen to increase, while energy and fuel prices are likely to remain high and volatile.

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