SINGAPORE - Singapore Post more than tripled its earnings for the year ended March 31, mainly due to an exceptional gain of $36.8 million on property revaluation.
Net profit rose 217.4 per cent to $78.3 million from $24.7 million, the Singapore-listed postal and logistics group said on May 10.
Underlying net profit grew 28.1 per cent to $41.5 million from $32.4 million a year earlier.
The board has proposed a final dividend of 0.56 cent per share.
Together with the interim dividend of 0.18 cent per share paid out in November 2023, SingPost’s total dividend comes to 0.74 cent per share, up 28 per cent from a year earlier and making up 40 per cent of underlying net profit.
SingPost group chief executive Vincent Phang said in a statement: “Our transformation continues to yield results in our core businesses as we execute our strategy.”
Net profit for the second half year rose 93.4 per cent to $66.9 million from $34.6 million, after the property revaluation.
Second-half revenue fell 5.9 per cent to 859.5 million, largely due to reduced sea freight revenues.
Breaking down its full-year performance, the group saw revenue decline 9.9 per cent to $1.69 billion on lower sea freight revenues.
By segment, logistics posted lower revenues, which fell 11.4 per cent to $1.17 billion, whereas operating profit dropped 20.4 per cent to $67.4 million.
In Australia, its operations – consisting of FMH and CouriersPlease – reported a 6.3 per cent increase in revenue to A$921.3 million (S$824 million), while operating profit nudged 1.6 per cent higher to A$63.2 million.
SingPost said: “The continued growth in the Australia business was underpinned by new customer acquisitions and volume growth, despite challenging market conditions”.
In contrast, its freight forwarding business saw both revenue and operating profits tumble, which SingPost attributed to an “industry-wide contraction in sea freight rates and volumes post pandemic”.
Freight forwarding revenue slumped 43.5 per cent to $263.1 million, while operating profit fell 48.4 per cent to $22.4 million.
Meanwhile, the post and parcel business also registered a decline in revenue for both its local and international operations, falling 2 per cent to $514.1 million.
On a brighter note, the segment was back in the black with an operating profit of $7.5 million, against 2023’s $12 million loss – aided largely by its international business.
Notably, its domestic operations for the segment were boosted by an 11 per cent jump in e-commerce volumes, as well as the postage rate adjustment in October 2023.
SingPost said this “helped to mitigate the impact of the continued decline in volumes of letter mail and printed papers”.
On the property front, revenue edged up 1.4 per cent to $77.7 million for the full year, and operating profit rose by about 5 per cent to $42.2 million as a result of “positive rental reversions at SingPost Centre”.
Commenting on SingPost’s overall results, CGS International analyst Ong Khang Chuen said they showed “a good set of turnarounds for the business”.
He noted that the Singapore operations had “returned to profitability” in the second half, while the profit margins for the international segment “continued to improve, with conveyance costs normalising”.
“Earnings should trend more positively going into the next financial year, taking into account its transformation efforts and the consolidation of earnings-accretive mergers and acquisitions, particularly in the case of Border Express, as well as the stake increase in FMH,” Mr Ong said.
SingPost’s Australian unit FMH acquired delivery service provider Border Express for A$210 million in November 2023.
“SingPost also expects meaningful revenue and cost synergies to be reaped as the group streamlines the various business units it had acquired in the past,” he said.
Separately, while the normalisation of sea freight rates is likely to continue weighing on earnings of SingPost’s freight-forwarding business, “we think the pace of decline should be easily offset by profit growth in the group’s other business units”, Mr Ong noted.
SingPost shares closed up 1.1 per cent at 46.5 cents, after its results announcement.
