SingTel – BT
SingTel joins e-book market with skoob
SingTel has become the latest to attempt turning the publishing world on its head, or to at least spell ‘books’ backwards.
Skoob, its e-book service, was launched yesterday, with six big publishing houses – Random House, Penguin, HarperCollins, Hachette Book Group, Simon and Schuster and Macmillan – on board. It also carries books by local publishers such as Popular and Marshall Cavendish.
Offered through a free Apple or Android app, as well as through browsers, the service has more than 39,000 titles, the majority of which are international, according to a SingTel spokesman.
On its website, the selection runs the gamut from George Martin’s Game of Thrones series to Asiapac comics. Classics such as The Art of War and works by Shakespeare will be available for free.
In a nod to the peculiarities of the local market, skoob also offers local study guides and educational books. ‘We believe skoob’s range of local study guides and educational books will be well received by school students, and we are looking to include assessment papers soon,’ said Goh Seow Eng, SingTel’s chief of digital home.
SingTel will enter a market which has been thus far dominated by Amazon through the latter’s Kindle e-book reader. A Goldman Sachs report in February said that Amazon accounts for 58 per cent of e-book sales in the United States. This is followed by Barnes & Noble with 27 per cent and Apple with 9 per cent.
Currently, the Kindle device is not shipped directly to Singapore and users here have resorted to gift cards or US credit cards to make e-book purchases on the Amazon online store.
‘The Singapore market has long been overlooked by e-book services from abroad. With the launch of skoob, Singapore readers finally have a service that offers local books and caters specifically to their tastes and needs. It also provides local publishers and writers with a powerful digital platform that allows them to reach a wider audience,’ said Mr Goh.
Unlike Amazon and Barnes & Noble, skoob is not tied to a specific device or platform. Customers have the option of sharing books on up to five devices.
Payment can be made with local credit cards and SingTel customers can opt to have purchases charged to their monthly bills.
While Amazon and Barnes & Noble offer digital subscriptions to magazines and newspapers, skoob does not appear to be headed in that direction, and will be focusing on e-books, according to SingTel’s spokesman.
In some cases, the skoob store offers e-books at a cheaper price relative to its competitors.
Kathryn Stockett’s The Help, for example, is listed at S$6.22 but was priced at US$9.99 for both the Kindle version on Amazon and the Nook e-reader version on Barnes & Noble. Haruki Murakami’s Norwegian Wood, however, was priced at S$20.05 on skoob, but was cheaper on Amazon and Barnes & Noble, costing US$5.99.
While SingTel did not reveal the number of readers it expects to draw, its spokesman said: ‘We believe e-books will be widely adopted in Singapore as more people carry tablets and smartphones…We know the demand is there, so we expect good take-up of the service.’
SingPost – BT
Fond memories of POSBank
But DBS-SingPost tie-up won’t yield products of that era
LAST week’s news that DBS Bank will offer basic banking services at the post office has conjured up expectations that it might revive the people’s bank.
Millions of Singaporeans have fond memories of what it was like to do their banking at the Post Office Savings Bank and it had little to do with nostalgia; the sentiment is firmly grounded in dollars and cents.
For instance, many of us had our mortgages with Credit POSB because it was the cheapest in town.
In 1998, the year that the government handed POSBank to DBS on a platter, a POSBank spokeswoman then estimated that the merger would eventually cost its customers about 12 per cent more in monthly instalments, based on the Credit POSB mortgage rate then of 6.75 per cent and DBS Bank’s rate of 8.25 per cent.
Offering cheaper loans did not mean POSBank did not make money.
In fact, it was raking it in. In 1997, the last year before it was swallowed up by DBS, POSBank posted $219 million in group net surplus (read profit) to the government.
Biggest mortgage provider
It was Singapore’s largest bank in several respects.
POSBank was the nation’s biggest mortgage loan provider, it had 150 branches and 672 ATMs and 5.7 million accounts. Not many will remember this, but it was also innovative: POSBank was the second bank to introduce ATMs in 1979, after Chartered Bank.
No wonder that in the subsequent years following the sale to DBS when many branches were closed as part of integration, it was often greeted with uproar.
Fast forward to Jan 3, 2012 and DBS/POSB customers will be able to access basic banking services at all SingPost’s 60 outlets.
The tie-up in Singapore between a postal service provider and a bank will enable DBS/POSB customers to conduct banking transactions at 140 outlets, up substantially from the bank’s 80 branches today, the bank said in a statement last Thursday.
Under the agreement with SingPost, banking services available to DBS/POSB customers at post offices include cash withdrawals and cash deposits of up to $5,000.
In addition, customers can also submit a POSB Everyday Savings Account application form at a SingPost outlet.
DBS corporate banking customers are not left out, they can deposit cash bags at four SingPost outlets.
The tie-up will not be cheap but should cost DBS considerably less compared to opening its own branches.
Neither DBS nor SingPost has revealed the expected cost or revenue to either parties from the landmark agreement.
SingPost earned $22 million from financial services for its 2010/11 financial year. The amount came from selling remittance services, UOB’s HDB home loans, ANZ and Standard Chartered Bank unsecured credit facilities and financial planning provided by Prudential .
DBS is working with SingPost to boost security measures at the post offices which could include having an armed guard and installing a safe to meet regulatory requirements.
Benefits trump costs
But the benefits of extending DBS’s network should far outweigh the costs, especially if later the bank increases the type of products it pushes through the post office such as credit cards and home loans.
SingPost and UOB have an exclusive five-year contract which began in 2009 for selling HDB home loans.
In the meantime, DBS could rake in much cheaper deposits compared to its rivals and make higher margins from selling loans.
In fact, in the parliamentary debate in 1998 on the privatisation of POSBank, former Ayer Rajah MP Tan Cheng Bock noted that while most POSBank depositors live in HDB flats with housing loans from the Housing & Development Board, ‘all the borrowers of Credit POSB are owners of private properties’.
But DBS/POSB customers could be disappointed if they think the new tie-up would lead to POSBank-type products or loans.
A DBS spokeswoman has told BT that there would be no rebranding come Jan 3.
As other banks look on and tote up the advantages that DBS might have on them in this scoop, the latter will have to work hard to fulfil customers’ expectations. 
SingTel – CIMB
Short term stumble but fundamentals intact
SingTel stumbled in 2QFY12 but the fundamentals of its units are improving, except for Australia’s Optus which will continue to face stiff competition over the next six months. Bharti’s performance should improve, based on consensus.
We remain optimistic on SingTel Singapore, Telkomsel and AIS. We trim our forecast but raise our SOP target price after rolling it forward. SingTel remains an OUTPERFORM with likely catalysts being improving fundamentals of its key units and attractive dividend yields.
What Happened
SingTel held its quarterly conference call after releasing its 2QFY12 results. The main takeaways are: – Optus expects competition to remain intense in Australia over the next six months.
– Capex in Singapore should ease going forward vs. FY12 despite more spending on LTE and the submarine cable between Singapore and Japan because its shift to a multimedia business model is less capital-intensive.
– SingTel is proposing to acquire 2% of AIS because it believes it can continue to add value to the company.
– Cannibalisation of SMS by data is small among its associates vs. in Singapore and Australia because of the low smartphone penetration in the developing countries. SingTel also allayed concerns over cannibalisation as Singapore and Australia bundles voice/SMS/data vs. in Europe where it is priced separately.
What we think
No major surprises from the call. Our positive view of SingTel remains unchanged. The most notable point in our view is the continued intense competition in Australia, which is our key concern for Singapore. However, we think the rest of its units are performing well or should improve going forward, especially Bharti.
What You Should Do
We believe investors should remain invested in SingTel. The stock is defensive with most of its units performing well while dividend yields are an attractive 5%, which should help weather the market uncertainties.
SingPost – BT
DBS takes banking back to its post office roots
Basic banking services at all SingPost branches, cash bag deposits for corporates at 4
The relationship between post offices and banks has come full circle. And for those nostalgic for the Post Office Savings Bank of years gone by, well it’s practically coming your way again as DBS Bank yesterday said that it would offer basic banking services at all SingPost branches.
The move will scoop the competition as DBS extends its network to 140 outlets, a massive 75 per cent jump from the current 80.
And the bank said that the tie-up was not a precursor to closing branches. ‘No, of course not. Our branch network remains very important to us,’ said Fen Peh, a DBS spokeswoman in response to the question of whether the SingPost outlets would lead to shuttering of some branches.
‘Real estate is at a premium now, we have to explore different types of customer touchpoints.’
Under the landmark partnership, DBS and Singapore Post Ltd will offer basic banking services at all SingPost’s 60 outlets from Jan 3, 2012.
‘This first-of-its-kind tie-up in Singapore between a postal service provider and a bank will enable DBS/POSB customers to conduct banking transactions at 140 outlets, up substantially from the bank’s 80 branches today,’ the bank said in a statement.
Banking services available to DBS/POSB customers at post offices include cash withdrawals and cash deposits of up to $5,000.
In addition, customers can also submit a POSB Everyday Savings Account application form at a SingPost outlet.
DBS corporate banking customers will be given the option of depositing cash bags at four SingPost outlets. They are Bukit Batok Central Post Office, Jurong West Post Office, SingPost Centre Post Office and Yishun Central Post Office.
The banking services will be handled by SingPost staff.
On whether DBS will offer more services at the post office, Ms Peh said that it would depend on the take-up and opportunities.
This is not the first time SingPost has handled banking services. Earlier in January, DBS partnered SingPost to offer the new notes exchanges during Chinese New Year at selected post offices.
Jeremy Soo, DBS head of consumer banking, Singapore, said that the bank already has the largest number of banking touchpoints here. It has over 1,300 automated teller machines and cash acceptance machines.
‘This collaboration with SingPost translates into even greater banking convenience for our four million customers when they visit the post office,’ said Mr Soo.
The irony of the deal will not be lost on old-timers. The Post Office Savings Bank used to provide low-cost banking services to Singaporeans, from as far back as 1877. It went on to become a statutory board and was renamed POSBank in 1990 before being acquired by DBS in 1998.
DBS has now returned banking to its post office roots.
SingPost is not new to providing financial products either. Since 2009, 14 post offices have been selling HDB home loans offered by United Overseas Bank under a five-year exclusive agreement.
The post office also sells unsecured credit facilities from ANZ and Standard Chartered Bank. It offers financial planning services from Prudential Assurance Company Singapore (Pte) Limited and Prudential Asset Management (Singapore) Ltd.
Loh Choo Beng, SingPost executive vice-president, retail & financial services, said that the firm has been transforming to stay relevant and close to customers.
‘This collaboration with DBS/POSB is another effort to provide a higher level of convenience to our customers. By making basic banking services available at our counter, we give our customers a choice to have their banking needs met as they come to us to buy stamps, pay bills, remit money or complete other transactions,’ he said.
SATS – BT
SATS Q2 profit slips 11.3%
Profit at $40m on $424m revenue; group continues to fight food inflation
AIRPORT services giant SATS Ltd posted a $40.1 million net profit attributable to shareholders for the second quarter ended Sept 30, down 11.3 per cent from $45.2 million a year earlier as it continued to battle inflation, while contributions from associates and joint ventures slipped.
But underlying profit was flat at $44.6 million, compared to $45.2 million as its Japan-based TFK venture started contributing.
Topline revenue for the July-September quarter rose 32.3 per cent to $424.2 million, compared to $320.6 million.
Earnings per share (EPS) for the quarter was 3.6 cents, compared to 4.1 cents last year.
For the first half, the company posted profit attributable to shareholders of $82.6 million, down 7.7 per cent from $89.5 million. Revenue for the April-September 2011 period rose 30.3 per cent to $809.8 million.
EPS for the first half was 7.5 cents, versus 8.2 cents a year earlier.
The company, sitting on cash of some $163.4 million (prior to the sale of UK-based Daniels Group), announced an interim dividend of 5 cents per share.
SATS, which accounts for 80 per cent of the market at Changi Airport, saw expenditures rise 36 per cent, largely as food inflation and staff costs soared during the first half.
Still, its operating margin (net of Daniels) was steady at 10.7 per cent, while underlying net margin was 10.5 per cent.
SATS recently announced that it was divesting UK-based, non-aviation food unit, the Daniels Group, to Hain Frozen Foods UK for £pounds;159 million (S$321.8 million).
The Daniels Group – which manufactures and sells chilled drinks, ready-to-eat meals as well as fresh fruit and pudding – was acquired by SATS in 2009 as part of the latter’s takeover of Singapore Food Industries (SFI).
Asked if the company could make a special payout to shareholders from the Daniels sale proceeds, chief executive Tan Chuan Lye said that SATS was continuously seeking acquisition opportunities with the cash it had. ‘Whether or not we pay shareholders will be a matter to be discussed later,’ he said.
Over the last year or so, SATS has made numerous investments such as taking up a 40 per cent stake in Saudi-based Adel Abuljadayel Flight Catering Company as well as a 50.7 per cent stake in Japan-based TFK Corporation.
The company saw associates and JV contribution fall 16 per cent during the quarter, largely due to the declining fortunes of the cargo segment in South-east Asia.
Some 84 per cent of its revenue came from aviation side, while food solutions accounted for 56 per cent of sales. Some 65 per cent of revenue was from Singapore operations. Japan’s contribution was 14 per cent, from virtually nil last year, as TFK started firing up.
The company has also recovered 80 per cent of the cost of acquiring SFI via post-acquisition profits over the last 32 months.
Mr Tan noted that Changi’s newest and third ground handler, US-based Aircraft Service International Group, had yet to secure any new business during the period under review.
Meanwhile SATS acquired the inflight catering contract for Lao Airlines, and in Hong Kong and Japan, it got the ramp handling for Hong Kong Airlines and Hong Kong Express. It also renewed contracts with Japan Airlines, JetstarAsia, Tiger Airways and TNT Airways, and retained other clients.
SATS serves seven of the nine budget carriers operating out of Changi.
The company is awaiting the tender results for the contract to operate the Singapore International Cruise Terminal, which it expects shortly. The multi-million-dollar facility will officially start operating in April next year.
The latest results boosted SATS’ net tangible assets per share to around $1.01-$1.04 (based on the Daniels sales), up from 81 cents before.
Mr Tan said that despite the prevailing uncertainties in the operating environment, SATS would continue to grow and strengthen its core business and enhance shareholder value.