Bus and train operator SBS Transit posted a net profit of $8.1 million for the first quarter ended March 31.
The figure was nearly 70 per cent higher than for the previous corresponding period, as higher ridership and a substantial drop in fuel and power costs bolstered its bottom line.
Revenue grew 6.6 per cent to $263.5 million, while operating expenses crept up by 5 per cent to $252.4 million.
Fuel and power costs fell by 31.5 per cent to $28.9 million, on the back of depressed oil prices. This was offset by rises in staff and maintenance costs, which rose by 13.3 per cent and 19.5 per cent to $139.9 million and $31.2 million respectively.
The 75 per cent-owned subsidiary of transport giant ComfortDelGro Corp reported an operating margin before interest, tax and depreciation of 11.2 per cent, up from 10.9 previously.
AT A GLANCE
REVENUE: $263.5 million (+6.6 per cent)
NET PROFIT: $8.1 million (+69.5 per cent)
Its earnings per share stood at 2.61 cents, up from 1.54. Net asset value per share stood at $1.13, up from $1.10.
Bus operations generated an operating profit of $7.3 million (135.5 per cent higher than previously), while rail earnings remained flat at $3.7 million.
Looking ahead, directors expect rail revenue to grow with higher ridership from the four-month-old Downtown Line 2.
But its bus revenue will be affected "with the gradual transition out of the Bulim and Loyang bus services". Bus routes in these two areas have been clinched by foreign companies, which were successful in bidding for the new government bus contracts.
The directors added that the company is looking at raising the salaries of operational employees, and is also hiring to prepare for the opening of Downtown Line 3 next year.
These will lead to higher staff costs. Repair and maintenance costs are also expected to rise.
Meanwhile, SBS Transit's cash position remained tenuous. For the quarter just ended, it had a net cash inflow of $400,000, mainly from new loans raised, net cash generated and grants received.
As at March 31, it had cash and equivalents of $4.8 million. After accounting for borrowings of $278.5 million, it had a net debt position of $273.7 million, resulting in a gearing of 78.5 per cent - down from 99.7 per cent as at Dec 31 last year.
Elsewhere, sister company Vicom, a vehicle inspection company, posted a 13 per cent drop in net earnings to $7.4 million as revenue shrank 10.4 per cent to $25.4 million for the quarter.
This was on the back of a rejuvenating vehicle population as more old cars are scrapped.