Singapore Post is bringing its dividend policy down to a more "sustainable" level as it waits for e-commerce investments to pay off while domestic mail volumes continue to creep downwards.

The postal group, which has been extending its e-commerce reach in recent years through a string of acquisitions, yesterday announced an interim dividend of one cent per share, down from 1.5 cents per share in the second quarter last year.

SingPost had said in July that it would review its dividend policy to better reflect underlying earnings.

The group posted a net profit of $31.4 million in the second quarter, down 41.2 per cent from the same period a year earlier, due to higher costs in the e-commerce business, costs related to its new Regional eCommerce Logistics Hub, and loss of rental income from SPC mall's redevelopment.

Excluding one-off gains from the divestment of DataPost last year, underlying net profit fell 27.9 per cent to $27.1 million in the quarter.

Revenue in the three months ended Sept 30 was $321.7 million, up 22.3 per cent from a year ago, driven by the inclusion of United States e-commerce acquisitions, TradeGlobal and Jagged Peak.

But the operating loss for the e-commerce segment widened by 219.9 per cent to $6.8 million in the second quarter, from a loss of $2.1 million a year earlier. SingPost attributed the higher costs to continued investments in IT and operational capabilities, while tight competition for seasonal fulfilment labour in the US drove up cost significantly.

Mr Mervyn Lim, covering group chief executive, reiterated over an earnings call yesterday that the group will take time to "integrate and synergise" and execute its e-commerce strategy.

But the e-commerce business is "extremely seasonal", he added, and volumes are expected to rise in the current period, which is the peak holiday season.

Mr Lim added that the group would name a new chief executive before the end of the calendar year.

Second-quarter earnings per share was 1.28 cents, down from 2.31 cents in the second quarter last year.

Net asset value per share was 71.19 cents as at Sept 30, from 72.26 cents as at March 31.

Chairman Simon Israel said in a statement: "SingPost's dividends in the past had been largely supported by the domestic mail business, which continues to see declining volumes.

"We have revised SingPost's dividend policy from an absolute amount to one based on a payout ratio ranging between 60 per cent and 80 per cent of underlying net profit for each financial year."

Earnings were posted after the market closed. The counter gained 3.5 cents or 2.17 per cent to close at $1.65 yesterday.