ComfortDelGro net profit doubles to $130m as economic activity returns

Operating profit ended 72.6 per cent higher at $210 million, giving it an operating margin of 5.9 per cent. PHOTO: ST FILE

SINGAPORE - Transport giant ComfortDelGro's net earnings last year more than doubled to $130.1 million as its key markets recovered from the pandemic.

For the 12 months ended Dec 31 last year, the Singapore-based group with businesses in countries such as Australia, Britain and China posted a 9.1 per cent rise in revenue to $3.5 billion on the back of increases in economic and social activities.

And although several operating expenses - led by manpower and fuel/energy expenses - went up, this was mitigated by lower depreciation charges and much lower impairment on vehicles and goodwill. As such, total operating cost crept up by 6.6 per cent to $3.3 billion.

Operating profit ended 72.6 per cent higher at $210 million, giving it an operating margin of 5.9 per cent (from 3.8 per cent previously). Net earnings after tax attributable to shareholders was 114 per cent higher at $130.1 million.

For the year, the group received $84.6 million in government relief, down from $169.3 million in 2020. But even before factoring in the relief, it posted an operating profit of $125.4 million, from a loss of $47.6 million.

Net earnings per share rose by 113.5 per cent to 6 cents. Net asset value per share stood at 124.9 cents, from 122.15 cents.

Net cash and equivalents stood at $919.1 million, versus $742.8 million the year before. Gross gearing fell to 12.7 per cent, from 18 per cent in 2020.

ComfortDelGro chief executive Yang Ban Seng said: "It has been another challenging year but the high global vaccination rate has helped economic recovery through the easing of social restrictions and the reopening of borders.

"As a transport operator, we have certainly benefited from the increases in economic activity, but we are not out of the woods yet."

The taxi business improved significantly, going from an operating loss of $64.4 million in 2020 to an operating profit of $18.5 million last year as rental discounts lessened and call bookings increased.

The group said call bookings were now 90 per cent of 2019 levels of around 80,000 per day.

Its public transport business posted a 5.3 per cent rise in operating profit to $130.7 million as more people returned to work and leisure activities rose.

Its inspection and testing services business benefited from a recovery in non-vehicle testing activity, and posted a 15 per cent rise in operating profit to $30.6 million. Its driving centre division saw operating profit rising 73 per cent to $14.9 million, largely because there were Covid-19-related closures in 2020.

Directors are recommending a final dividend of 2.1 cents per share. Together with an interim dividend of 2.1 cents, this represents a 70 per cent payout of net profit, versus 50 per cent last year. In 2020, there was no interim dividend, while the final dividend was 1.43 cents.

Group chairman Lim Jit Poh said the group was still aiming to unlock value of its investments in Australia by looking for investment partners. Its move to float its businesses Down Under was aborted last year on the back of a spate of other listings.

Mr Lim added that ComfortDelGro was also now looking at expanding into the logistics arena.

"We've been moving people. Now we want to move goods," he said, adding that this would include attendant activities such as warehousing. "This is likely to be through acquisitions."

Last November, the group entered into a joint venture to start a concrete-transporting business in China.

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