SingPost Q3 profit climbs nearly 16% on one-off gain

Post and parcel revenue rose 9 per cent to $213.2 million, thanks to increased domestic and international deliveries over the e-commerce peak season. SingPost's e-commerce segment also saw higher volumes, driven by festive shopping in the US.
Post and parcel revenue rose 9 per cent to $213.2 million, thanks to increased domestic and international deliveries over the e-commerce peak season. SingPost's e-commerce segment also saw higher volumes, driven by festive shopping in the US.ST PHOTO: DESMOND WEE

An exceptional $28.2 million gain from the dilution of interest in a Chinese associate boosted Singapore Post's (SingPost) results in the third quarter. Net profit rose 15.6 per cent to $50.2 million for the three months to Dec 31.

The lift stemmed from China-based logistics firm 4PX ceasing to be an associated company after SingPost's shareholding was diluted by the issuance of additional 4PX shares to an existing shareholder.

Profit on operating activities declined 8.5 per cent to $42.2 million as higher contributions from post and parcel, logistics and property businesses were largely offset by continued losses in the United States, said SingPost.

Earnings per share stood at 2.06 cents for the quarter, up from 1.75 cents a year earlier.

An interim dividend of 0.5 cent a share has been declared. It will be paid out on Feb 28.

Revenue grew 7.6 per cent to $441.4 million on the back of higher peak season volumes.

The firm expects its post and parcel business to continue benefiting from the growth in global e-commerce and its property business to remain stable but domestic letter mail volumes are expected to trend moderately down.

Notably, post and parcel revenue rose 9 per cent to $213.2 million, thanks to increased domestic and international deliveries over the e-commerce peak season.

SingPost's e-commerce segment also saw higher volumes, driven by festive shopping in the US, with turnover rising 8.7 per cent to $82.5 million.

The firm expects its post and parcel business to continue benefiting from the growth in global e-commerce and its property business to remain stable but domestic letter mail volumes are expected to trend moderately down.

Nonetheless, it continues to face challenges in the US e-commerce market due to greater competition and rising customer bankruptcies.

"The US businesses are underperforming, and are expected to remain loss-making in the current financial year," SingPost said. "In view of this, there is a risk of impairment to the carrying value of the US businesses.

"Impairments, if any, will be assessed based on the full financial year results and future plans for the businesses."

A version of this article appeared in the print edition of The Straits Times on February 02, 2019, with the headline 'SingPost Q3 profit climbs nearly 16% on one-off gain'. Print Edition | Subscribe