SINGAPORE – Singapore Post (SingPost) reported operating profit of $33.9 million for the third quarter ended December 2022, down 9.7 per cent from $37.5 million the previous year.
This was despite group revenue rising by 13.4 per cent year on year to $495.1 million from $436.6 million previously amid the seasonal peak for its businesses across its markets.
The bottom line was hurt as operating expenses rose by 15.3 per cent to $460.8 million from $399.6 million the previous year, mainly due to higher volume-related and labour-related expenses from the consolidation of its fourth-party logistics operator in Australia, Freight Management Holdings (FMH).
SingPost’s top-line growth for the quarter was mainly driven by higher logistics revenue as FMH continued to perform well, with increasing volumes from existing and new customers.
This helped to offset the impact from the e-commerce pullback in CouriersPlease’s business-to-consumer last-mile delivery business, along with lower revenue from freight forwarding business Famous Holdings in tandem with a decline in sea freight rates.
In the post and parcel segment, cross-border e-commerce logistics volumes as well as domestic volumes fell amid a slower e-commerce retail market after coming off a high base the previous year, which was boosted by a volume surge during pandemic restrictions.
Property revenue also fell year on year, largely due to the deconsolidation of General Storage Company, which was divested in December 2021.
SingPost Centre’s overall occupancy as at the end of 2022 stood at 98.7 per cent, up from 96.7 per cent as at the end of the second quarter, and 92.1 per cent as at end-2021, due to the higher take-up of office space.
Its retail mall space was fully occupied as at end-2022, the group said.
On a quarter-on-quarter basis, group operating profit was up 10.3 per cent, while revenue and operating expenses rose 2.4 per cent and 1.4 per cent respectively.
Citing high inflation and tight financial conditions, SingPost said it expects the operating environment for 2023 to remain challenging due to a weak global economic outlook.
The group said it will “remain vigilant and maintain financial prudence” while exploring opportunities to divest non-core assets and deploy capital to transformation initiatives for growth.
Shares of SingPost dropped 0.9 per cent to 54 cents apiece at Tuesday’s close. THE BUSINESS TIMES
