SingPost – BT

SingPost Q1 net profit dips

Total revenue climbs a marginal 0.7% to $121.8m; mail revenue down 7.2%

SINGAPORE Post (SingPost) has posted a marginal 0.1 per cent dip in its fiscal first-quarter net profit to $39.4 million, as the group coped with lower mail revenue and higher operating expenses during the period.

For the three months ended June, mail revenue – which accounted for the lion’s share of its total revenue – fell 7.2 per cent to $85.9 million. Despite increases in its logistics and retail businesses, total revenue climbed only a marginal 0.7 per cent to $121.8 million.

‘The operating environment remains challenging and difficult,’ said SingPost CEO Wilson Tan. ‘The performance of our business segments in the first quarter clearly reflects the continued weak economy and lower demand.’

Total expenses increased 5.5 per cent to $84.7 million, mainly attributed to the consolidation of G3 Worldwide Aspac Pte Ltd (G3AP), a provider of cross-border mail services. Labour and related costs rose 2.5 per cent to $33.6 million, even as the group gained some $2 million from the Jobs Credit Scheme.

SingPost does not have any short-term debt as at end-June. But it owed $301.8 million as a result of a $300 million bond issue that will mature in 2013. The bonds have a fixed interest rate of 3.13 per cent per annum.

Cash and cash equivalents stood at $184.9 million. Earnings per share slipped to 2.045 cents, from 2.051 cents. The group has proposed an interim dividend of 1.25 cents per share. Net asset value fell to 12.67 cents, from 13.30 cents as at end-March.

The group is banking on two recent acquisitions to expand into new markets. It recently bought the remaining 50 per cent that it did not own in G3AP and acquired a 30 per cent stake in US-based postal technology firm Postea.

With G3AP, SingPost will focus on opportunities to expand beyond cross-border mail business and extend its services to the rest of Asia-Pacific. As for Postea, it is looking at joint development and marketing of postal and logistics technologies.

SingPost shares ended up half a cent at 89 cents yesterday.

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