Serious SingPost's profit down 41%, Sinkie companies screwed up but foreigners swee!

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An honorable member of the Coffee Shop Has Just Posted the Following:

Genting Singapore - parent is Malaysian - reports strong earnings
Marina Bay Sands - parent is American - reports good earnings

Singapore Airlines - profit collapses 70%
Singapore Post - profit collapses 41%
Keppel - profit collapses 38%
Sembcorp Marine - outright loss

Conclusion: Singapore companies screwed up, foreign companies huat ah!


http://www.todayonline.com/business/...ividend-policy

SINGAPORE — Postal and logistics services provider Singapore Post (SingPost) said on Friday (Nov 4) that it has revised its dividend policy, as it reported net profit fell 41.2 per cent in its fiscal second quarter, mainly due to the absence of one-off divestment gains previously enjoyed as well as higher costs and expenses arising from its e-commerce transformation.

Mr Simon Israel, Chairman of SingPost, said: “We said at our 2016 annual general meeting in July that we would be reviewing our dividend policy. We have revised SingPost’s dividend policy from an absolute amount to one based on a pay-out ratio ranging between 60 per cent and 80 per cent of underlying net profit for each financial year.

“The principle guiding the board in setting the dividend policy is that dividends must be sustainable and paid out of underlying earnings. SingPost’s dividends in the past had been largely supported by the domestic mail business, which continues to see declining volumes.

“To provide future sources of earnings, significant transformational investments have been made in e-commerce, e-commerce logistics and in the redevelopment of the SPC retail mall. In the short term, however, these investments will impact earnings. We have raised capital and taken on debt to fund these investments. The need to review the dividend policy should be understood in this context.”

The revised dividend policy, whereby SingPost will continue to pay dividends quarterly, takes effect from the second quarter ended Sept 30. The board of directors declared an interim dividend of 1 cent per share to be paid on Nov 30.

For the three months ended Sept 30, SingPost said net profit fell to S$31.4 million from S$53.4 million in the year-ago quarter, even while revenue grew 22.3 per cent to S$321.7 million. Underlying net profit, which excludes one-off items, was down 27.9 per cent to S$27.1 million, due to higher expenses in its e-commerce business, costs related to its new e-commerce logistics hub, loss of rental income from the redevelopment of SPC Mall, as well as a decline in domestic mail volumes.

Mr Mervyn Lim, SingPost’s covering Group Chief Executive Officer, said: “We are taking a long-term view as we build scale for future profitability. While financial benefits will not be immediate, initiatives such as the Regional e-Commerce Logistics Hub that was opened on 1 November 2016, as well as our deepening collaboration with Alibaba, will strengthen our e-commerce logistics network for future growth.”

Postal revenue was stable but operating profit declined 10.6 per cent, SingPost said. Cross-border e-commerce related deliveries rose, mitigating lower domestic letter volumes, which were particularly affected by one-off postings in the previous year from the SG50 National Day in August and the General Election in September. Logistics revenue slid 1.2 per cent to S$154.1 million, with lower contributions from activities not related to e-commerce amid a global economic downturn.

The consolidation of SingPost’s new US subsidiaries, TradeGlobal from November 2015 and Jagged Peak from March 2016, drove up e-commerce revenue to S$64 million. The segment incurred an operating loss of S$6.8 million on continued investments in IT and operational capabilities, SingPost said, adding that tight competition for seasonal fulfilment labour drove up costs significantly.

SingPost shares rose 2.2 per cent to S$1.65 before the aftermarket results announcement, while the benchmark Straits Times Index (STI) fell 0.5 per cent. SingPost shares have risen 0.6 per cent this year, compared to the 3.3 per cent decline in the STI.


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