SBS Transit posted a 26.6 per cent rise in first-quarter earnings to $10.2 million on the back of better margins from bus contracting.
The ComfortDelGro-owned transport operator reported a 7.6 per cent increase in revenue to $283.4 million for the period ended March 31. Lower finance and other operating costs shored up its bottom line.
Earnings per share stood at 3.3 cents, up from 2.61 cents in the same period last year. Group net asset value per share climbed to $1.38, compared with $1.35 as at Dec 31.
Margin before interest, tax and depreciation improved from 11.2 per cent to 13.2 per cent.
SBS Transit said revenue from public transport services was bolstered mainly by the transition to the Bus Contracting Model as well as higher ridership from rail services.
Average daily ridership for the Downtown Line grew by 19.1 per cent to 245,000 passenger trips in the first three months.
AT A GLANCE
REVENUE: $283.4 million (+7.6%)
NET PROFIT: $10.2 million (+26.6%)
Average daily ridership for the North-East Line grew by 3.9 per cent to 579,000 passenger trips and that for the Sengkang-Punggol LRT rose by 11.3 per cent to 122,000 trips.
The higher ridership was partially offset by lower average rail fare from the fare reduction that took effect from Dec 30 last year.
Meanwhile, revenue from commercial services slid by 16.5 per cent to $14 million, largely because of lower advertising revenue.
The company reported a net cash inflow of $6.3 million for the first three months, mainly from new loans raised and partially offset by repayment of borrowings, cash used in operations and purchase of vehicles.
At the end of the period, SBS Transit had cash and bank balances of $10.5 million. After accounting for borrowings of $282.6 million, it had a net debt position of $272.1 million and a net gearing ratio of 63.4 per cent - up from 50.7 per cent as at Dec 31.
Directors expect revenue from public transport services to be higher for the remaining three quarters. Its rail business will continue to see ridership growth, while its bus operations will see a full-year contribution of revenue under the Bus Contracting Model.
Under the model, the Government assumes ownership of all fixed and operating assets and operators are paid a fixed sum to ply services.
SBS Transit said revenue from its non-transit commercial operations is expected to be lower mainly because it had lost the Loyang and Bulim bus route packages.
Operating costs will be higher with salary adjustments as well as the build-up of headcount ahead of the opening of Downtown Line 3.
Repairs and maintenance costs are also expected to be higher.
Altough SBS Transit clinched the contract for the Seletar bus package, it will not have any impact on the current financial year as the deal begins in March next year.