Singapore Post reported Friday its fiscal second quarter net profit rose 10.3 percent on-year to S$27.73 million on improved performance from associates and joint ventures and a year-ago exceptional fair value loss on warrants.
Revenue for the quarter ended 30 September increased 2 percent on-year to S$324.39 million on higher international post and parcel revenue from cross-border e-commerce deliveries, SingPost said in a filing to SGX.
“This is partially offset by a decline in domestic post and parcel revenue, which is accelerated by a sharp reduction in both business letter volumes and advertising mail, and a drop in freight forwarding revenue as a result of lower volumes from the slowdown in global trade,” the filing said.
Excluding exceptional items, underlying net profit fell 4.6 percent on-year to S$26.8 million for the quarter, SingPost said.
“Improved results from associated companies and joint venture remained insufficient to offset the drop in earnings from the post and parcel segment and freight forwarding business,” the postal and logistics company said.
Operating expenses for the quarter rose 6 percent on-year to S$287.59 million, the filing said.
SingPost reported a share of gain of associated companies and joint venture of S$319,000, compared with a year-ago loss of S$3.63 million.
In the property segment, revenue was stable at S$30.3 million for the quarter, with the SingPost Centre retail mall and office remaining near full occupancy, SingPost said. Profit on the segment’s operating activities rose 3.1 percent on-year in the quarter to S$13.8 million, the filing said.
SingPost declared an interim dividend of 0.5 Singapore cent a share, unchanged on-year.
For the fiscal first half, SingPost reported net profit increased 21.8 percent on-year to S$53.41 million on revenue of S$645.65 million, up 1 percent on-year.
In the outlook, CEO Paul Coutts was cautiously upbeat.
“Domestic letter mail volume continues to decline while e-commerce-related package volume continues to grow, leading to the overall lower blended margins of our financial performance, partly offset by our cost leadership program,” Coutts said in the statement.
“SingPost remains optimistic in the actions we are taking to reposition ourselves for the future. These initiatives, such as our Smart Letterbox system, will undoubtedly transform Singapore’s postal landscape and position us for the future,” he added.